structure in order to make R & D in the urban field as productive as it was in the Aerospace and Defense fields.

With respect to the above, the first thing that would have to happen is that more and more functions within a given geographical area would have to be combined into a system for pooling of the analysis and planning effort, as well as implementation. If the Aerospace and Defense project office concept is used, such a project office would have to have cognizance over a wide variety of urban activities such as transit, schools, housing, waste disposal, welfare, public works, etc. These functions would have to be treated as unrelated parts of a single dynamic system. (This is the essence of systems analysis.)

The second change that would be necessary would be to treat functions over much wider geographical areas than is the case at present. Little progress now seems to be taking place with respect to this second consideration in connection with problems which cover areas which transcend existing political boundaries (e.g., pollution, transportation, etc.).

The failure to properly aggregate analysis and planning with respect to urban problems is now becoming quite generally recognized, and is becoming the subject of growing interest if not considerable action.

The most highly publicized effort to use Aerospace Research and Development techniques on non-aerospace urban problems are the four studies performed by the aerospace industry for the State of California. These aerospace-type studies were conceived several years ago at a time when it was anticipated that substantial cuts were imminent in defense spending. The studies were intended to test the potential usefulness of Aerospace R & D techniques in the solution of statewide public problems. The topics which were selected were:

1. A study to develop broad guidelines for the establishment of a total system for waste disposal in order to prevent and minimize pollution of land, air, and water.

2. A study aimed at the design of a new system to which the state can advance for the handling of the criminal and mentally-ill segment of the population.

3. A study to determine what kind of an information system was needed in terms of fact gathering, processing, storage, and retrieval.

4. A study of a program to develop an integrated land, sea, and air transportation network.

It was the assumption of the State of California that a systems approach such as is used in many Defense and Space R & D programs would be useful to the State of California. Each contract ran for six months and was funded for $100,000, which is a relatively small amount when weighed against Federal R&D contracts for Defense and Space.

All four contracts have been completed and, at least in the eyes of those performing and reviewing the work, they proved to be extremely enlightening. The report on Data Handling and Information Systems provided the concept of a ten-year plan for the development of a state-wide information system. The Crime and Delinquency Report outlined the problems and showed the consequences-in terms of cost and benefits of either ignoring the problems or introducing much needed changes. In the Waste Management Study the need was demonstrated to consider "waste" in all of its forms-gaseous, liquid, and solid-and to treat the problem of waste disposal as a single system in which each segment affected the other. Finally, the Transportation Study stressed the need for a large-scale, mathematical model of the complex transportation system that California would require in the future. One of the chief virtues of the reports was their concentration on the problems as functional systems problems, with a willingness to look beyond the immediate constraints of political jurisdictions and traditional administrative boundaries. The emphasis that was placed on the California experiments was on what should be done rather than who has the authority to do it. If Federal R & D programs can be used to stimulate economic growth and development throughout the country, I think that it is very important that goals and priorities be agreed upon before we conclude that Defense and Aerospace R&D techniques can be transferred to the urban or local development area. The goals in Defense and Space seem to have been fairly well articulated and even generally understood by the American people. To defend the nation against foreign enemies and to put a man in space, and perhaps on the moon, seem to be generally accepted goals or policies. But the same is not true with respect to the establishment of fundamental goals in other important matters. Questions of basic

urban policy seem to quite subjective. Of great debate are questions as to the desirability of increasing the quality of life for the urban poor, or taking steps that will bring the upper-middle class back to the central cities. The values of our society, and the qualities of life determined by such values, make the R & D approach used in Space and Defense more difficult when applied to urban problems. It seems to be difficult for cities to articulate their goals, but if we have been able to handle the problems of setting goals in the Defense and Aerospace sector, why should we not be able to do the same in the urban sector?

In the Defense and Aerospace environment, we found a user or customer structure that was well-defined and highly organized. In the urban field, this is not so. In the urban field, one sees nothing but conflicts as to goals, and little means of resolving them by existing mechanisms. Just as an example of the conflicts that exist-while applying Defense and Aerospace R & D techniques clearly calls for wider boundaries than are usually found in the urban area. many of today's suburbs in this country have developed as a means of isolating their residences from the "undesirable" element in the central cities. It is unlikely that the suburbanites who live in these suburbs will be prone to take a broad metropolitan viewpoint with respect to their problems, even though Defense and Aerospace R & D techniques would require broader perimeters. My own position happens to be that effective R & D techniques in dealing with urban problems could be achieved only if some kind of authority were to be created whose mandate would be broader than individual municipalities and whose approach would employ the best in systems analysis, which in this case means tying together the interdependent functions so that we understand how they interact and affect one another (e.g., housing, health, transit, public works, education, etc.)

In calling for an increased federally-financed R & D effort directed toward the solution of the increasing urban problems which I have mentioned, I would make the point that R & D funds so directed would automatically spread themselves more evenly throughout the nation than have DOD and NASA funds. The reasons for this are:

1. All of the urban areas are confronted with the same kinds of urban problems.

2. Every urban area is a natural research laboratory in connection with researching these problems.

3. Every urban area has universities and other intellectual resource capabilities which can be put to work in connection with the solution of these problems.

Finally, I would recommend that the pattern of Research and Development which can contribute to regional economic growth be structured along the following lines:

1. That Congress establish goals of policies for the solution of national problems such as housing, transit, pollution control, etc., in which fields it is believed that science and technology can make significant contributions. 2. That the new R & D programs in the urban problem fields borrow from the Defense and Space programs those administrative mechanisms which have proven to have been successful and in which an interface is established between industry and government agencies.

3. That these programs be funded with sufficient appropriations to cause broad and deep involvement by industry, even if this funding means the creation or the establishment of markets for the eventual hardware which the federally-financed R & D effort will hopefully produce.

In this way, I believe that several important objectives can be accomplished: 1. Spontaneous regional economic development will take place as a result of these programs improving the quality of urban life.

2. The full potential of presently untapped research resources will be brought into play.

3. The capabilities of the private sector will be brought into play in problem areas in which their capabilities are very much required.

4. The Federal Government will have provided the leadership and the financial resources necessary in order to bring the nation's Research and Development capabilities into important fields (such as the urban field) which, in the long run and in the final analysis, may prove to be even more significant than our present level of accomplishments in Space and Defense. Senator HARRIS. Senator Walter F. Mondale of Minnesota is present to present our next witness. Senator, I would like to welcome you.

TESTIMONY OF HON. WALTER F. MONDALE, U.S. SENATOR FROM THE STATE OF MINNESOTA

Senator MONDALE. Mr. Chairman, I am delighted to be permitted to appear briefly this morning to introduce the next witness, Dr. Frank Verbrugge, and to join with many others in the Senate who are grateful to the chairman of this subcommittee for his leadership in delving into this problem and the whole question of the policy of the Federal Government and its agencies in the field of research.

I know of no issue which is more important, and I know of no one who is doing a finer or a more responsible job in pursuing that quest than the chairman of the subcommittee.

I am pleased to be here this morning at the opening session of these hearings.

Senator HARRIS. I want to tell you that after an opening statement like that, if I had any funds to distribute, I would see that Minnesota got them.

Senator MONDALE. I gave you about 45 seconds to pick that up. Senator HARRIS. I noticed that you paused for applause.

Senator MONDALE. I know you are very familiar with the kind of contributions Minnesota makes around the country, including our football coaches, some of whom have gone to Oklahoma.

I am pleased to be here this morning at this opening session relating to the geographic distribution of Federal R. & D. funds. My main purpose is to introduce to this subcommittee our outstanding acting dean of the institute of technology at our great university, Dr. Frank Verbrugge, who is well qualified to discuss today's topic, the impact of science on regional development.

I think it underscores the importance that our great university attaches to this hearing, that with him as well is Mr. Paul Cashman, who is a vice president of our university, and is here to indicate the significance that the university attaches to pursuit of this question. I think it is widely assumed that geographical imbalances in the distribution of Federal R. & D. funds have an adverse effect on regional development in areas not getting a fair share, but I think that we do not really know-in fact, we do not know very much at all-about the detrimental side effects of many Federal programs bevond R. & D.

There are aspects of this problem which I hope that this committee will be able to explore. Among them is, I hope, an exploration of an amendment that I attached to the Space Authorization Act 2 years ago, which is still a part of the law, requiring the Space Administrator to consider geographical distribution in the distribution of space contracts, space research, university support, and the

rest.

It is my impression that that is one of the least used paragraphs on the U.S. statute books. I wish that this committee could explore it. For example, we know the basic money costs of highway programs. But there are also costs involved when highways isolate the poor, accelerate the deterioration of some neighborhoods, and help perpetuate crime-ridden ghettos. In order to gage the impact of existing programs, and to anticipate what we need in the future, we must have better and more factual information-information like that this committee is attempting to gather here.

A realistic assessment of all the costs of Federal programs can be determined through adoption of a system of social accounting along the lines of a bill that I have introduced with 10 other Senators, including the chairman of this subcommittee. This bill would provide for a set of social indicators and establish a Council of Social Advisers, an annual social report, and a joint congressional committee.

We hope to institutionalize, much like the Council of Economic Advisers, a factual assessment of the social considerations and results of all the various Federal policies, programs, and proposals.

Mr. Chairman, in pursuit of the question before this subcommittee this morning, I am most happy and pleased, and proud to introduce Dr. Verbrugge. In his work at the institute of technology, he has had considerable experience with Federal and other R. & D. funds. As the university and its Federal involvement have grown rapidly in recent years, he has had an opportunity to watch the impact of science on the development of the region served by the University of Minnesota.

In a discussion with Dr. Verbrugge before appearing here this morning, he indicated a very close understanding of the operation of the base university support program, the new Themis program of the Department of Defense, and others, and I think he has some worthwhile observations on those programs that the committee may be interested in.

I know this subcommittee will find his testimony of great worth in the investigation.

Senator HARRIS. Thank you very much, Senator Mondale.

Mr. Cashman, we are glad to have you. Dr. Verbrugge, we are glad you are here. I believe you have a prepared statement.

TESTIMONY OF DR. FRANK VERBRUGGE, ACTING DEAN, INSTITUTE
OF TECHNOLOGY, UNIVERSITY OF MINNESOTA; ACCOMPANIED
BY PAUL CASHMAN, VICE PRESIDENT, UNIVERSITY OF MIN-
NESOTA, MINNEAPOLIS, MINN.

Dr. VERBRUGGE. Yes, I have a prepared statement.
Senator HARRIS. You may proceed.

Dr. VERBRUGGE. Mr. Chairman, as Senator Mondale pointed out, I represent a large university which is located in an area where the economy is developing on the basis of a highly modern industry.

I hope also this morning to make a few specific comments directed more explicitly to the national program of institutional grants. By way of background, it may be helpful if I make a few general

comments.

The State of Minnesota, in terms of the usually quoted data, occupies an economic position of about 20th in national ranking. For example, it currently ranks 20th in value added by manufacturing, 18th in personal income, and 18th in population. In its industrialization, it has developed more rapidly than its contiguous areas, and in a very real sense the metropolitan area of Minneapolis-St. Paul represents also the industrial hub for the entire region.

The University of Minnesota, for its most part, is located in this metropolitan area. The university is the only institution in the State

offering the Ph. D. degrees; it also produces nearly all master's degrees for science. Also, in engineering, it is the source of all baccalaureate degrees. It is both the State university and the land-grant institution, and accordingly is the major recipient of Federal funds for research in educational institutions. Hence, how a Federal program for support of science affects the University of Minnesota is to a considerable extent synonymous with how it affects the State of Minnesota. In level of research support and in output of graduate scientists and engineers at the Ph. D. level, the Univesity of Minnesota is one of the major institutions in the country. Though the actual rank is determined by the criterion being used, the university usually achieves a rank in the range of 10 to 15 nationally. This stature bears testimony to the support it has received both from the State and from the Federal Government.

Minnesota, and particularly the Minneapolis-St. Paul metropolitan area, is recognized as one of the major centers of high-skilled technology in the United States-for defense, for space science and engineering, and for a diversified civilian industry.

These industries have enjoyed a high growth rate over the past 15 years, during which time employment in these industries has more than doubled. Minnesota's industry is able to attract and keep young scientists and engineers, not only from the University of Minnesota and from surrounding States, but from throughout the country. It is a net importer of scientific and engineering personnel.

I should perhaps emphasize that this applies to the State and not to the Upper Midwest region as a whole.

Perhaps one can conclude, therefore, that the existence of a university within such an industrial complex is an important and perhaps essential component in its development. It is, however, not a sufficient condition. That is, it does not automatically follow that research at universities leads to economic development and growth. Such a development arises from the conjunction of a number of factors. Among these are:

(a) an attitude of entrepreneurship by both academic and industrial scientists and engineers;

(b) willingness of the local financial interests to underwrite the imaginative ideas that develop so that new industries and new programs within existing industries can develop;

(c) a flexible attitude of a university toward interaction of its staff with that from industry: in consulting arrangements, exchange of visiting staff, and exchange of information on research developments; (d) an active program of continuing education, particularly at the graduate level, so that young scientists and engineers have opportunities for professional development. This program of continuing education is of importance also to a university staff member in order to keep himself in the forefront of his field.

This, then, is the context-the context of a major university within a rapidly growing, highly skilled, technological-oriented economywithin which I would like to make a few comments about establishing a national program of institutional grants to universities and colleges. It is a program which we strongly endorse. Sustaining grants have many advantages, when appropriately planned.

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