White House Round Table Views

There were two viewpoints that were in evidence at the White House Office of Science and Technology Policy meeting on graduate and postdoctoral education earlier this month.

The first view, which was most thoughtfully articulated by Michael Teitelbaum, Vice President of the Sloan Foundation, is that the national discussion on science funding has focused too much on the supply of scientists and not enough on demand. We need to do a better job of ensuring that the training we provide matches what employers (both academic and non-academic) need. We also need a better (quantitative) understanding of how science functions as a system, and we need to use that understanding to optimize the way that we invest in science. Michael's slides are available here This was more or less the majority view at the meeting, though some were skeptical that demand could be gauged in any useful fashion.

The second view, which was most forcefully advocated by David Skorton, President of Cornell, is that the real problem with science is that there are simply not enough federal resources being invested. Investments in science lead to economic growth, so demand-side problems will work themselves out. I must confess that his talk left me scratching my head, so my summary probably doesn't do Skorton full justice. Peter Lee, head of the CS department at Carnegie Mellon, summarizes Skorton's views and adds some of his own in his blog. Take a look, because similar arguments have been very influential in getting things like America COMPETES passed.

Having seen for myself in the mid-90's just how badly things go when the supply of PhDs outstrips the demand for them, I'm much more inclined to agree with Michael Teitelbaum's views than with Skorton's and Lee's. But I'll have more to say about both.

The Flattened World

Today’s Wall Street Journal has a very interesting article by Pui-wang Tam and Jackie Range – “Some in Silicon Valley Begin to Sour on India”. (Contact me if you can’t get a copy of the article). The authors interview a number of small and large business managers in Silicon Valley who have pulled out their outsourced operations in India. Why? Because the cost of the best engineers in India has risen to nearly that of engineers here in California!

Several of those interviewed noted that salaries for the best (best = technically experienced with good communications skills) have risen upwards of 30% per year over the past few years. In contrast wage growth in California is around 3% for engineers. For small and mid-size companies at least, it has become more economical to bring the few stars from India to the US and close down the operation abroad. The article also discusses other hidden costs of off-shoring technology development – employee turn-over is huge and dealing with development teams who work at different hours of the day is a big pain for managers.

India is still booming in the industry of lower-level tech support such as call centers etc., but even business in these areas is already starting to migrate to lower wage countries such as Vietnam.

You may recall that Thomas Friedman set off a wave of concern in the US with his book The World is Flat in which he saw a coming wave of global competition where the cheapest and most talented people world-wide would be in direct (and fierce) competition. Friedman saw this as potentially a huge shock to tech workers in the US, and there is no doubt that the increase in outsourcing over the last few years has contributed to the stagnation in wage growth among tech workers in the US.

But if Indian wages for the “best” are rising to nearly those in the US perhaps the tech sector has arrived at the end of the flattening phase. Sure, India produces 500,000 science and engineering grads every year but, according to a McKinsey Study (quoted in the article) only 25% have the language proficiency, cultural fit and practical skills required to work at multinational companies. US-born tech workers with good technical skills, good communication skills and cultural literacy are competing directly with these folks and they have one huge additional advantage: they are already in the US.

Because science and technology have always been a transnational community perhaps it was inevitable that tech workers would be the ones who would feel the changes of globalization first. But now that Globalization 1.0 appears to have occurred we discover that things aren’t as dire as Friedman (and perhaps some readers of this blog) have feared. US tech workers CAN compete with the best and brightest abroad. And because we have been competing for quite some time we may fare better when the world is rendered totally flat. Let’s see how the Radiologists, Investment Analysts and Mortgage Brokers fare…

A key to the value and strength of the US tech worker, as this article suggests, is not simply his or her technical skills. Communication, cultural fit and practical work experience are paramount. As long as science and engineering remains dominated by the US, US tech workers will fare fairly well. Maintaining the underlying forces that keep the US at the top of the technology/knowledge/value creation pyramid should be the real focus of policy makers in Washington.

Meanwhile in the Senate...

I've just taken a look at the Senate's hefty bill to reauthorize the NSF, S 761. Like the House equivalent, there are some good and interesting things in the bill.

• There is a lot of new money for graduate fellowships:

IGERT - Increased funding to the IGERT program, like in the House bill. This would fund provide funding for more graduate students, but IGERT programs appear to be much better suited to providing people with more of a range of career options than traditional PhD programs. The stipends, which are semi-portable traineeships rather research assistantships, are pretty hefty, too. $30K/year is more than some postdocs are paid - perhaps it will stimulate some upward growth in S&E graduate stipends overall.

The Senate's numbers are a lot lower than the House numbers - $22M/year in 2008 to $55M/year in 2011 (as opposed to ~$75M-$150M/year for the House). Since there was pushback from the administration on the way the House was proposing to fund IGERT (as a fixed percentage of the NSF's budget), I imagine something more like the Senate's version will go through.

Graduate fellowships - The Senate bill also allocates a good chunk of money for new old-style fellowships, ranging from $24M/year in 2008 to $60M/year in 2011. The House bill doesn't provide any new money for fellowships apart from the overall budget doubling.

DOE graduate fellowships - $9M/year-$35M/year in fellowships for "students pursuing a doctoral degree in a mission area of the Department [of Energy" - energy and nukes, presumably.

So altogether the Senate is proposing increased funding for graduate fellowships in the amount of $140M by 2011, which translates to about 2,800 new doctoral students per year.

A little digging in WebCASPAR shows that NSF funds about 20,000 full-time graduate students (about 5% of all full-time graduate students). If we make the assumption that the NSF funds primarily doctoral students and that NSF funding is spread over 5 years, we find that NSF funds on the order of 4,000 doctoral students/year.

So the combination of a budget doubling plus the new fellowships, if allocations are held constant, would increase NSF-funded doctoral students by about 4,000+2,800 = 6,800. This estimate is probably on the high side, since IGERT stipends are pretty high, some NSF funding probably goes to master's students, and the new money for fellowships may result in reallocations of other funds away from graduate fellowships; let's say there will be 5,000 new NSF-funded doctoral students per year. In 2005 there were 29,000 S&E PhDs granted, 13,000 of which were in the physical sciences and engineering. NSF's funding is concentrated in the physical sciences and engineering - NSF's existing 4,000 or so fellowships combined with 5,000 new ones would mean that NSF could end up funding most doctorate recipients in those fields.

Will this increase the number of doctorates granted per year? Maybe - Richard Freeman has some interesting work that suggests so - but perhaps not by 5,000. Once a department has its teaching needs covered, the incentive to enroll graduate students is reduced. New money from NSF frees up existing departmental funds that pay TAs for other purposes. Labs will be staffing up once new NSF grants start flowing, and I'd bet that they'll want to hire postdocs, not graduate students. I predict an increase in the total number of postdocs in many math and physical sciences fields. In fields, like CS and engineering, in which most people go to industry after graduating, postdocs will probably be harder to come by, so they'll end up with more grad students.

• There is a modest amount of money to fund Professional Science Master's degree programs.

Professional Science Master's programs were created by grants from the Sloan Foundation back in 1997. I have met several people who have been through PSM programs, and they sound great - they're essentially hybrid-MBA/science degrees. If the country needs more scientists to spur economic growth, this is a great way to get them. The programs graduate people who know enough science to do useful things in theory, but who also know enough about navigating companies to actually accomplish things in practice.

I'm very encouraged to see the possibility of the NSF picking up PSM funding. Once institutions get into the business of bringing real, professional skills into science curricula, it's only a matter of time before the ideas diffuse into more mainstream science programs. There's nothing in the House bill about PSM programs, so I think this is iffy, but since the amount of money is modest ($9M/year in 2008 to $20M in 2011), I'm hoping it will pass.

There is a ton of additional material in both the Senate and the House bills about teacher training. More on that in a future post.

More Graduate Students - Brought to You by IGERT

The increase in graduate students discussed earlier in the week just came a step closer to reality: the House and Senate just passed a set of bills that will steer a big chunk of funding toward new graduate fellowships, among other things. I assume there will be some negotiation in conference over the final form, but the boost to graduate numbers is a lot closer to reality.

One caveat: the bills just authorize increased spending, but they don't actually provide it. So there is room for things to be cut by failing to be funded in appropriations bills.

I have started looking through a few of the bills, and as best I can tell, there is some interesting and good stuff in them. There are also some things that are disappointingly omitted. As with HR 1453, the bills smack of AAAS Fellow influence - hats off to any of you who are reading this.

The House passed 3 bills:

• HR 1867, the National Science Foundation Authorization Act of 2007, which doubles the NSF budget,

• HR 363, the Sowing the Seeds Through Science and Engineering Research Act, which funds a bunch of undergraduate and graduate fellowships, and

• HR 362, the 10,000 Teachers, 10 Million Minds Science and Math Scholarship Act, which funds S&E teacher training.

The Senate passed a single, 200+ page bill, S 761, the America Competes Act (more formally, the America Creating Opportunities to Meaningfully Promote Excellence in Technology, Education, and Science Act).

I've just started looking into these, and I imagine they'll take a few posts to digest.

HR 363 is the House bill most relevant to grad students. It passed 397 to 20, so at least some portion of it seems pretty likely to happen. Doubling the NSF budget will likely increase spending on grad students as well, but probably not in ways qualitatively different from current expenditures.

I notice in GovTrack that authorization for funds has been stripped out of the bill. So I'd guess that it will be funded at a lower level than the bill calls for.

Section 4 of the bill is the interesting bit:

SEC. 4. INTEGRATIVE GRADUATE EDUCATION AND RESEARCH TRAINEESHIP PROGRAM.

(a) Funding- For each of the fiscal years 2008 through 2012, the Director of the National Science Foundation shall allocate at least 1.5 percent of funds appropriated for Research and Related Activities to the Integrative Graduate Education and Research Traineeship program.

(b) Coordination- The Director shall coordinate with Federal departments and agencies, as appropriate, to expand the interdisciplinary nature of the Integrative Graduate Education and Research Traineeship program.

(c) Authority to Accept Funds From Other Agencies- The Director is authorized to accept funds from other Federal departments and agencies to carry out the Integrative Graduate Education and Research Traineeship program.

I'm disappointed that there are no provisions for measuring efficacy or for linking expenditures to the state of the labor market, so it ends up being a command-and-control type of program (like most of the rest of science, alas). That being said, funding IGERT rather than more traditional NSF fellowships seems like a promising way to go.

The good thing about IGERT (from the IGERT FAQ):

"A major objective of NSF's IGERT program is to train students in areas where industry, government and academic institutions are experiencing a shortfall. IGERT graduates may work in industries ranging from pharmaceutics to petrochemicals, government laboratories devoted to health, commerce or energy, small teaching colleges and major research universities. An important benefit of the IGERT programs is that most students have opportunities to sample these locations during their training. This makes it easier to decide which career environment is right for you."

So IGERT is not about creating a bunch of new professors.

Another good thing about IGERT he IGERT money goes to traineeships rather than research assistantships. The funding is not as portable as what Romer was calling for, but funding tied to the department is a lot more portable than funding tied to a researcher. I think it's a reasonable compromise between full portability and the increasingly common no portability.

(An aside: There have been a number of National Academy reports that have called for more portable funding, but they always seem to get shot down. I've spoken to some National Science Board members about the issue, and the story I have gotten from them is that they are terrified that given full portability, students will all end up at some program other than their own. This discussion gives a sense of the "debate." It's total BS - people say they don't want more portability because it might screw up the wonderful system we have now. But there is no analogous concern raised when funding shifts away from portability as it has steadily for the last couple of decades. Moreover, they complain about the lack of data documenting benefits of portability, but they never actually try running any experiments to gather any. It's not rocket science. In fact, there is actually a lot of data available in the SED and the SDR that would let one compare career outcomes for people funded by portable vs. non-portable funding, but nobody has bothered to run the stats. As best I can tell, nobody wants to know.)

The less good thing is that IGERT seems to emphasize interdisciplinarity for its own sake. Googling "IGERT" turns up some goofy sounding programs - "Interactive Digital Multimedia" at UC Santa Barbara (you can get a PhD in that?), "Biological Invasions"(!) at UC Davis, and so on. But plenty of sensible things, too.

IGERT seems to be about creating new programs, too, but maybe I'm just not understanding correctly. I'd be happier if there were provisions for existing programs getting their acts together in terms of providing professional development for their students, but maybe IGERT would lead to some diffusion.

It's interesting that the bill steers a fixed fraction of the NSF's budget toward IGERT rather than a specific amount. I'm guessing that's so that IGERT would benefit proportionally if the NSF budget is doubled and so that there isn't some convenient dollar amount to target once appropriations committees take their knives to the bill? 1.5% of a $5 billion dollar budget is $75 million. IGERT currently gets about $12 million / year, so that's a hefty boost. And $150 million if the NSF's budget doubles.

IGERT students get $30K stipends (more than NSF gave their postdocs back in my day, stingy things), plus tuition (call it $20K) plus maybe some overhead for health insurance, etc (say $10K). Probably there is some faculty and institutional money in IGERT (after all, creating new programs isn't cheap). So let's say half the money goes to students at $60K apiece. $75 million buys you a grand total of ... 625 students. And 100 of those were already funded. Even doubled, we're talking a not very large number of people. Romer's proposal is for an extra 17,000 new PhDs per year, so this is a tiny fraction of what he's talking about.

The administration has indicated that they don't like the idea of having a fixed fraction of the NSF's budget allocated to a particular program (because the other 98.5% just isn't enough). I assume this is because of pushback from senior people who don't like the idea of either portable funding or their pot of grant money being diminished - similar complaints were heard during the NIH doubling.

More Graduate Students?

There have been a few bills working their way through Congress that seek to significantly increase the number of graduate students. Why now, at a time when people are asking, "Are we training too many PhDs?"

Much of the current impetus comes from the National Academies report, Rising Above the Gathering Storm -- the bills in question also address other Gathering Storm recommendations -- so the question becomes, where did the Gathering Storm report get the idea? Because the report was put together in very short order (10 weeks), the idea almost certainly came from elsewhere.

I recently dug up a 2000 working paper by Stanford economist Paul Romer that I think may contain the seeds of the current push to increase the ranks of graduate students. Here is a good piece on Romer's efforts to get Congress to implement some of his ideas. Romer is a smart guy, and while I'm not convinced by everything he says in the paper, it's a very interesting piece of work.

S&E research has been linked to overall economic growth. The question Romer addresses in the paper is that of, "What is the best way to increase the amount of science and engineering research done in the US?"

Several federal programs try to stimulate research activity by bolstering demand. Romer argues that there are 2 problems with a demand-side approach. First, demand subsidies don't necessarily increase the overall amount of research done. Unless the supply of researchers increases in response to demand, demand subsidies will just push wages up. Second, structural features of universities cause the supply of researchers to fail to respond to demand. This second point is the crux of the paper: because demand doesn't trigger increased supply, Romer argues that the government needs to subsidize supply instead of demand by creating large numbers of new graduate fellowships.

Romer discusses 2 reasons for the decoupling of S&E supply from demand:

First, S&E graduate programs provide no information on outcomes or salaries for their graduates, which prevents prospective students from being able to respond to demand signals in their enrollment choices:

"The lack of information that is available to students who are making decisions about careers in science and technology suggests that our existing educational institutions may not lead to the kind of equilibration that we take for granted in many other contexts. If students do not have information about what wages will be, it will be much harder for them to adjust their career decisions in response to wage changes."

Romer did an experiment in which he had an graduate assistant start the application process at the top 10 programs in business, law, and 6 different S&E fields. The assistant requested information on recent graduates' salaries from all programs, and got information from 80% of the business schools, 70% of the law schools and 0% of the 60 S&E programs. This problem seems straightforward to remedy - the Graduate School Guide provides some program level outcome information (but no salary information yet). The NSF is currently experimenting with a salary question on the Survey of Earned Doctorates, and should the test prove successful, it should be straightforward to assemble program-level post-graduation salary information.

Second, the response of competitive undergraduate institutions to increases in demand for S&E's is interesting. Elite liberal arts colleges gain prestige by being very selective. Suppose undergraduates respond to increases in demand for S&E's by enrolling in more classes that will prepare them for S&E careers. One response might be to hire more S&E faculty and to accept more S&E undergraduates. That's expensive and risky (if demand decreases, universities are stuck with excess faculty and facilities) and reduces selectivity. A simpler, alternative response:

"A liberal arts university that has a fixed investment in faculty who teach in areas outside of the sciences and that faces internal pressure to maintain the relative sizes of different departments may respond to this pressure by making it more difficult for students to complete a degree in science. Faculty in the departments that teach the basic science courses will be happy to 'keep professional standards high' and thereby keep teaching loads down. Faculty in other departments will be happy to make study in their departments more attractive, for example by inflating the average grade given in their courses. There is clear evidence that this kind of response currently operates on campuses in the United States."

So part of the reason that relatively few Americans pursue S&E careers may be the incentives under which universities operate.

Romer argues that immigration has provided a way around this undergraduate bottleneck and that S&E immigration levels have been much more responsive to changes in demand than domestic supply.

As an alternative to increasing reliance on foreign-born S&Es, Romer proposes creating large subsidies for both undergraduates and graduate students pursuing S&E degrees. These appear to be what we are seeing in current bills to increase the number of S&Es.

The details of his proposed subsidies are interesting, and it's worth looking into whether the current bills capture some of Romer's key points. More later in the week.