From the gift link in the tweet:
“… The N.I.H.’s announcement was made, of course, in the language of “efficiency.” “Can you believe that universities with tens of billions in endowments were siphoning off 60 percent of research award money for ‘overhead’?” Elon Musk wrote. “What a rip-off!” The actual percentage is less than half that, but sure, put it all in the wood chipper.
The problem with doing that is that these grants are a crucial reason that America has the most advanced biomedical research infrastructure — the N.I.H. awards grants to more than 300,000 researchers at more than 2,500 institutions, including the Mayo Clinic and the MD Anderson Cancer Center in Texas — along with some of the biggest pharmaceutical companies in the world.
Every dollar in N.I.H. grants spurs $2.09 in economic activity, and every $100 million in investment leads to 78 patents and $598 million in further research, according to N.I.H. calculations. Those “overheads” help cover basic infrastructure that make all this possible.
The grants have been the source of new treatments for cancer, heart disease, diabetes, strokes and H.I.V.; wonder drugs like Ozempic; groundbreaking techniques like I.V.F. and laparoscopies. Cutting them will significantly narrow the pipeline to future cures and drugs.
…
By law, all applicants for N.I.H. grants
divide their budgets between “direct costs” — the research itself — and “indirects,” which are more general costs like lab equipment, utility bills, payroll services and so on. Indirects also help cover N.I.H.’s very expensive requirements for tracking dangerous chemicals, hazardous waste disposal, radiation safety, fire security and so on.
… It’s hard to calculate that precisely (how much did it cost to have the lights on for 10 hours last Tuesday?) so decades ago, the government decided to do it as a percentage — written into the terms of the grant — of the whole. Which is the
actually efficient way to do it.
…
A lot of what N.I.H. has funded is basic research that pharmaceutical companies rely on — and which they rely on to develop their products — but won’t fund, in part because it’s not possible to say with certainty where the research will lead. …”
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That last paragraph is a good example of why “running the government like a business” doesn’t make sense in a lot of contexts because the profit motive of a business doesn’t apply to the common good motive of the government, or the calculation of value of government activities to American businesses writ large. Business doesn’t invest in open ended research in the knowledge that the minority of research that bears fruit will benefit other businesses that can build on the initial discovery.
