 Thank you very much for sticking around for the next panel. In this panel, the name of this panel is kind of provocative. It is environment and energy and innovating in the belly of the beast. We have three people who have done a lot of innovation within the government. I'm going to introduce them very, very briefly. They each require a longer introduction and then kind of get started into the discussion of what they've done and what their thoughts are about how you innovate from within the government. At the end here is Margaret Davidson. She's director of the Coastal Services Center at the National Oceanic and Atmospheric Administration. She's a faculty member at the University of Charleston and she serves on the adjunct faculties of Clemson University and the University of South Carolina. Of interest to people doing public policy here, she came into the belly of the beast from outside as a critic or as an agitator for more thoughtful dissemination of publicly funded information and now has been sentenced to 15 years of innovating within that beast's belly. So watch what you wish for. In the middle is Jeff Marcusy. He's the executive director of the Strategic Environmental Research and Development Program at the Department of Defense and he's director of the DOD's Environmental Security Technology Certification Program. He's been very instrumental in both doing a lot of work in innovation on energy and environment within DOD and also has written quite a lot about it. If you pick up this publication outside, there's an article by him in it. And sitting right next to me is Michael Holland, who's the incoming chief of staff at New York University's Center for Urban Science and Progress, former senior advisor and staff director of the Department of Energy's Office of the Undersecretary for Science. I believe he also worked for OMB and have worked within the government for many years. He turned in his blackberry at DOE Friday. He's a newly ex-government. This is a very interesting day to sit here and discuss energy and environment innovation in government because two interesting things, as well as the myths about this, two interesting things are going on today. One is that the Navy has its Mowgli sort of war game, video game thing out today looking for people to give suggestions about radical ideas for changing the way that the Navy uses energy. And the other thing is that the House Armed Services Committee is holding a hearing today. I'm not sure how far they've gotten with this, but they would like to ban the Department of Defense from using biofuels that cost more than the market price for fuel. As we're talking about myth, this opens up a whole bunch of interesting questions. First of all, with regards to double M Mowgli, the video game, is it ideas that are needed for innovation or is it systems? Are we just in a free floating search for radical new ideas, new molecules we can plug in, or do we need to do something completely different, do we need to change ourselves in the way we work around these things? And I think this panel really addresses some of these questions. The other thing has to do with this House hearing, which is, is there a free market price for fuel? Does fossil fuel actually have a free market price that reflects its actual price? And secondly, does the Department of Defense pay that? On a couple of different levels, one is that the Department of Defense pays more generally for fuel than an airline would, so they're competing in the market because of the way they buy it. And the second thing is that the Department of Defense can end up paying something like $100 a gallon for fuel in the forward positions in Afghanistan just because it costs so much to get a gallon of fuel up there. So there are these sort of operating myths about what the free market is, what government's relationship is to the free market, and also what this market of ideas means for innovation. And I think what's interesting about this panel is that all of them have sort of challenged this received wisdom that we have, that we need more ideas and we need it to compete with the current price of fossil fuel. So what I wanted to do was to kick off quickly with Jeff. If you could talk a little bit about your work with the Department of Defense as a segue from that and tell us particularly I think about some of your work with groundwater research, groundwater contamination. Thanks. So I managed an R&D program at the Department of Defense and as many of you who have looked at innovation systems probably know the Department of Defense has a pretty good history on innovation. But it's generally been focused on things that directly affect or support the warfighter. And so historically costs and issues like that have not made a difference. But in the space of environment and energy, even within the Department of Defense, we are very cost-conscious. And so we have established an R&D program which tries to link fundamental research, sometimes done by us, sometimes done by the Department of Energy, with the end-use needs we have. So what has allowed the Department of Defense to really be an innovator in the broad technology world I think has been that we're an end-user of it. It's not throwing out ideas and saying, oh, I hope someone might find a use for this. But it hasn't been the space of areas like environment and energy where the linkage to cost and life cycle costs are so critical. So in my program, we established back in the mid-90s a research effort and a technology demonstration effort to move advances for how do we deal with groundwater that's contaminated with chemicals. A big problem in the private sector, huge problem in EPA, and equally big problem in the Department of Defense. But we took a different tack than many other federal agencies. One was recognizing, okay, how does this marketplace actually work? Who owns the intellectual property? Who actually makes a decision to deploy the technology? What players are involved in them? Once you understood that, we brought in what we thought were the best people, which were not necessarily people in DOD or DOE labs. They were in the private sector and industry. They were in academia. Sometimes they were in federal labs. And linked them with people who cared about the end-use management of cleaning up groundwater sites. That allowed us to both fund pretty basic research at times, all the way through very applied demonstration, in a way which sort of cycled the lessons learned very rapidly, not over a decade timescale, but in a matter of a few years, and radically changed how we clean up groundwater in the Department of Defense, which saved DOD billions of dollars, and got picked up very rapidly by the major industrial players, Dupont, GE, Monsanto, folks like that, and EPA Superfund sites as well. Maybe given time to talk a little bit more later, we're sort of taking that model of a Department of Defense need, given the size and our responsibility in the energy space, and again trying to serve as an engine of innovation by really linking end-users and a critical thing we recognize, the need to do operational demonstrations, testing of technology in a real-world situation, not just to say, does it work, but to say who needs to operate it, how much is it going to cost, how are you going to buy it, all those practical issues which too often government research programs, in my opinion, ignore. I think that's really interesting is who is the end-user, and that is I think one of the questions of who, if government is going to innovate, who are we innovating for, and who is doing the innovation. And Margaret, I was hoping that you could talk a little bit about your project. Now, from what I understand, you began work outside the government, and in many ways your work is very, very applicable to climate change, but it takes the, rather than building consensus first, it sort of put the science to work. Well, I think building on what both you said earlier, we need more PAPS Blue Ribbon panels. Jeff said, yes, the phrasing is use-inspired. So first let me make it clear that sitting up here, let me make the disclaimer, no one who thinks that they're in my food chain above me would by any means condone what I'm about to say. And secondly, in the scale of mission agencies, NOAA is the chihuahua at the table. We're a $4 billion agency of which about a quarter of that's spent on the weather service, which is what most of you know about NOAA. The other three quarters we'll get to later. But $4 billion is small in the lexicon of DOD and DOE. I call it decimal dust, but anyway. So the scale at which people are faced with problems, and I actually particularly work at the interface of what we call disaster mitigation, which means just holding down the costs and losses associated with extreme events. And climate adaptation, because there are several instances, natural cycles in which everything you would want society to do if they were being thoughtful would be exactly the same. It's just that we tend not to respond in a very intelligent fashion when disaster strikes. And any lessons that academics might write up are usually lost on academics and never get translated into recovery redevelopment processes, let alone thinking more forward by a few decades, maybe not even quite a hundred years. So I'm interested in that interface, the two-fer interface, because when you work at a very small scale of resolution, the fellow before us talked about municipalities. So when it comes to land use, local government is everything. That's where all the planning, zoning, building decisions get made. In fact, we still argue whether or not there is a federal interest in land use planning. I would submit there is because there's a federal interest in maintaining our economic livelihood. And it bears a great relationship to our footprint on the landscape and the resources that we exploit to create that economic livelihood. But I'm interested, you have to find people, you have to work with people in the space that you find them. And in the scale of natural resources and the scale that I work with on climate issues, there's a local scale, so it's a high scale of resolution. And indeed, perhaps it's often preferred to champagne. And it's very important to not only understand the space in which you find those folks, but what is the language and what are the outcomes that they're interested in, even as you as a Fed are looking to understand and fulfill also that national mandate. So I would submit that understanding how we as communities and networks of communities could be more thoughtful about addressing the impacts of extreme events on any time scale. It's very important in the national interest because, well, just look after New Orleans, a little storm called Katrina and what it did to the price of oil and gas and a lot of other distribution channels that many folks don't even think about commodities. It had national and international implications. If I can interrupt, I think what's really interesting about the website that you and your team have developed is that you've taken years and years of climate data and enhanced its resolution so that you can be in Baton Rouge or you can be in Cape Cod, I think, or in California and you can look at it and you can figure out what is going to happen to your town as the climate changes. You can anticipate some of the potential big events. So some folks in this room probably work a lot with big model projections. We're using little model capabilities and we're also using a bunch of freeware. So you could go in, for instance, and you mentioned Cape Cod. That was actually one of the first places we worked with the Cape Cod Commission. So we developed a couple of visualization tools. One for a bathtub model for sea level rise, which just means you just raise the water level. Then another level of sophistication is you actually include the natural landscape into the model and it gets a little more complicated because there's give and take in everything, including the natural landscape. But that's not important. The physics of the water rising was the salient point. The showing the picture of the water rising with the photographs of the local landmarks, Town Hall, the community center, those are the kinds of messages that resonate with people much more than any scientist standing up in the front of the room. And even how we designed, you know, the web developers had a button system and it turned out that the people actually wanted a toggle bar because they wanted to slide it up and down. They wanted to watch the water run up and down City Hall, for instance. And they didn't want buttons. So the developer is like buttons because it's cooler and it looks better. But the normal people wanted slider bars. So we have slider bars. And I think this is interesting. It ties to the, not the previous discussion, but the one before that about patience, about making the towns part of the discussion. Patience and trust and actually an even preceding discussion in which someone talked about that we have a mythos in this country about our intellectual prowess. In fact, we're actually anti-intellectual, anti-scientific in this country. So you cannot approach a problem outside of the federal government leaning on your expertise. I happen to go home to Charleston, South Carolina. We're famously ignorant and pridefully so. And the worst thing in the world you can do is trot a fed or a PhD in front of a room and say it shall be so. Because you're going to get everything that you don't want to happen cascading from that pronouncement. So I work from the other end of the problem. How do you address the people where you find them on the landscape with the issues that they're most concerned about? And then you embed the knowledge. You embed the technology. You embed the capabilities into their framework. Not import your framework into theirs. I think that's a good segue to talking to you about what you've been working on at the Department of Energy and the possibility of a cascade of everything that you don't want to happen happening. Which is not a reflection on the DOE. It's more just a reflection on what happens when an institution has an investment, a long-term investment in certain technologies that aren't panning out over many years. One of the things that you worked on was the Quadrennial Technology Review. So this is the QTR for the DOE, for the Department of Energy was a new thing and it was based somewhat on the Quadrennial Defense Review. So you took an idea from another segment, took it over to DOE, adapted it for your purposes and then if you could talk about what it did and what it was meant to address. So the Quadrennial Technology Review was the first part of a process that the President's Council of Advisors on Science and Technology recommended. So taking the idea from the defense world that you actually start with your defense strategy and then you identify what you would need to carry out that strategy and then you sort of backtrack into the resources that you need so you should start with your problems and derive resources and that you take that idea, you apply it over in the energy realm which is a much more complicated part of the federal policy sphere in the sense that the authorities are divided among many cabinet level agencies, among many independent agencies. So while the name over our door is Department of Energy we don't have many of the regulatory authorities that are necessary or predominant in the energy arena. So Interior has the authorities for resource extraction, the Environmental Protection Agency has the authorities that control emissions into air and water, many of the emissions into land. There are other parts of the government that regulate particular technologies, the Nuclear Regulatory Commission for example. You know, we're in the energy realm, we're an R&D agency, we have a little bit of authority for regulating appliances. And so in trying to put together what this mythical thing that many people say they want, a national energy strategy, they basically said this is a complicated exercise. DOE, you go and take your little piece, this sort of what can be nicely hermetically sealed, the R&D programs, try to at least figure out a strategy for those. So the tradition oftentimes has been to... Can I just ask you how much money does DOE have for energy research? Oh, something less than four billion. So it's our fourth... You can compare that to the cost of cleaning up the Gulf spill. Correct. Well also the energy R&D is our smallest business line of the four, so nuclear weapons is by far our largest environmental management than the scientific research programs and then energy is the smallest. And so we took these four energy R&D programs and basically did something that was dramatically different than what the norm is. Normally each of those technologies, and we support somewhere in the order of 15 or 20 of them, you develop an individual technology roadmap for each, you sort of staple them together and it is left to others to infer what your priorities are. We actually decided to do the reverse. Start with the public policy drivers, start articulating what the constraints were upon the energy system, those that we controlled or those that... which are very few and those that others control, and then start sort of putting further and further constraints on what the energy R&D programs ought to do. And so we sort of derived some very general policy statements about how you ought to make priorities with when spending R&D money to attain a public policy goal in the energy arena. Can you give us examples? So we came up with a set of rules that essentially research ought to be material that in the sense that if we are going to invest in a technology, it should have the potential to at least affect the energy system at the, say, the 1% level. So we set our sites very low. We use about 100 quads of energy in this country a year. And so if we're going to develop a technology, it ought to at least have the ability to make a difference at that level. Now, if you look in our portfolio, there's a lot of stuff that we do that has the potential to impact at the 10th of a percent level. What are the 100th of a percent level? Because either the resource is so small, even if you maximally exploit that resource, it still won't make a difference, even at 100%. So that's the kind of stuff where we can say, in tight budget times, if you solve big problems, not small ones, the other thing is that if it's a technology that even if it does work perfectly acceptable, perfectly functional technology, if you can't build a business around it and sustain it without perpetual federal subsidy, that's probably not a thing to invest in. If you also, part of building a business around it is that there are other things in the system that are dominant in determining what you'll make, not just whether it works, but will the capital markets fund it? So we have decades of history showing that the outer limit of the tolerance of the capital markets is somewhere in the eight-ish billion dollars, or even five billion. And once a thing gets bigger than that, the resistance in the capital markets skyrockets. So for example, if fusion energy were to work, if we can get the Tokamak to work, it's coming in at 25 billion. So even if it works, there is very small, if not zero, probability that the capital markets would ever fund it. So why don't we take that money and deploy it somewhere else? So the nuclear energy arena for fission reactors, the very, very large Gen4 reactors, again, face that same hurdle. So we're actually redirecting the nuclear energy program towards small modular reactors. You can pop out one at a billion, billion and a half, you get that up and running, it's generating cash, you put in the next one at a billion, billion and a half, and that's a sustainable process for technology development, rather than waiting for some dramatic change in the capital markets or waiting on that subsidy. So one of the things I think that's interesting is that in doing this work, you discovered some of the agents of homeostasis within the sort of funding system. You know, things that kept the fusion program being funded. Can you talk a little bit about that? And then I want to open out to the two of you to talk in more about what are the sort of agents of homeostasis within government? What do you need to work with, work against, or turn to your advantage? So, I mean, you know, we've basically discovered, you know, 50-year-old political science research, in essence is what we've done. And that is, so, you know, the shortcomings of bureaucratic politics are well known to everyone except for physicists and engineers. And so there are a lot of things when, you know, our tradition, we are a research agency on the energy and science side of our department. And so we start thinking about where the research opportunities are. And so there then becomes the equity issues, right? So one group of scientists is not going to send another group of scientists away empty-handed. That is just a flat-out impossibility. And you can see that behavior, not just in the Department of Energy, but you see it in the National Science Foundation, you see it at NIH, et cetera. That is just a core behavioral aspect of research agencies run by researchers. And there are other aspects, you know, distributional politics take over. We have a very hard time mounting rational, compelling arguments against distributional politics, which sort of ties into that notion of equity. You know, look at the Hydrogen Fuel Initiative once something has started. You know, you go and you have well-qualified scientists come in and make very coherent technical arguments as to why a certain thing won't work. And, you know, they sort of lose out to the distributional political issues. Or once the funding is turned on, it's very hard to turn off those kinds of things. They're very, very well-understood sort of bureaucratic political failures. They're very, very hard to get over. Would you like to... Yeah. I've always felt sorry for some people in the Department of Energy because you do face a big challenge in that fundamentally, like NSF, the advocates or the customers are the researchers. Those are who are your people. One of the advantages the Department of Defense always point out is that my boss is a political appointee and not only has to approve my funding but she pays the bill for the things I'm trying to lower the cost for. So my customer is not the research community. My customer is an end-user group in DOD. Though I will point out that, you know, being successful in any large organization has to do with understanding its culture. And if you're not familiar with DOD, let me assure you getting funding for environmental or green energy is not inherent in the defense of our culture. What's inherent in the defense of our culture is steel on target and reducing operating costs. And so you've got to learn, and rightfully so, to tie those things to it. And it's not just a matter of tying it in a political or PR sense, but substantively tying it. And eventually you're judged by a track record of how many, in our case, it's billions of dollars you've saved or how many things have you improved for the use of our training or improved the performance of our weapons systems. But fundamentally, having an in-house customer, which for a research, because DOD is heavily a technology organization, culturally it loves high tech. Okay, that's its core, even though it's not its mission. But having embedded a research organization or a technology organization in a heavy mission organization who sees its survival based on advanced technology as an advantage that other agencies really don't have in the federal government. Yes. And you have explicit license to in fact be innovative in your problem solving. So you have a great advantage. That was interesting earlier when they were talking about the DARPA, ARPA, DARPA metamorphosis. So I'm in a science agency which is actually collaborating with and competing with people in the university community to serve a whole range of end users from people who make international climate projections, which is probably our scientific hallmark, to regional, to local scale, coastal ecosystem, fisheries issues. And that makes that challenging because we have a diverse user base. So I envy the clarity of the relationship. Not only so clear. And our agency also sits within a larger agency called the Department of Commerce who is usually headed by the campaign finance chairman of the person who successfully became president who thinks they're coming to commerce to hang out with guys in Italian loafers and suits. And they find that 70% of their budget has been on this wacky science and environmental stuff. So we have a cultural disconnect issue which you probably know. Secondly, I said our partners, our collaborators and our competitors is the university community. So 30, 40 years ago when NOAA was created, we had the toys. We had the money. We had the toys. And we had this dependency with people from the university community. And now that's totally flipped 40 years later. They got the toys. They got the Brainiacs. And more importantly, they got the political support because universities are among the most repacious consumers of public funding. And they're very good at having receptions on the hill. You talked about the equity of distributional politics. NASA does this really well. That's for the space station and 400 congressional districts. Many of us envy that in our more pragmatic moments. Right. If we could fly an accelerator or a ball five times, we'd have a new... Exactly. And build it everywhere. Right. Now you understand why our bases are located in certain places. That's why I'm envious of you. So our challenge is our partners and our competitors now actually have all the cards on their table. Secondly, as I said to you, I think that it's different also than 30 years ago when Jeff probably came to the federal government. Many of the brightest young people aren't interested in coming to the federal government to do science anymore. So we have a fundamental intellectual recruitment issue. And in my agency, I would say that inherently the people who populate that agency are fairly conservative individuals in their employment choices to begin with. So they like the pension plan, even though it sucks. And they like a bunch of other things about federal employment. And I'm not sure that that in itself is always the most conducive environment for innovation because what ecology teaches us is the most innovative parts of an ecosystem are at the edge where there's the greatest amount of tension and turmoil and fermentation. And everything about fed life is to keep you in the road in that lane observing all those yield signs. So you have this interesting confluence of the tendency of the researchers is to perpetuate the research. There's always more room for research and the federal issue. But it is an important organizational structural thing to think about in the federal government. There are federal research dollars that are thought of as extramural. They fund things. There are federal research dollars which support laboratories, which go on forever and ever and ever. And I would argue there's a legitimate role and importance for federal laboratories. But you end up with a struggle, I think, if you don't make sure that the funding decisions in your strategic directions don't really originate from the people who fund extramural stuff and they tap into the intramural laboratories are inherently not effectively done either in an academic setting or in industry because the expertise isn't there. But what I see in a lot of federal agencies is either the extramural and the intramural never talk to each other. I might argue that might be NIH. Or that the extramural is too beholded to the intramural and perhaps that's historically been DOE's case. Organizations like mine, which is small, it's just an extramural funding. In my life, I actually compete federal laboratories against universities. And in some places I fund universities, I even fund NOAA. Sometimes when they're in the right place, things like that. But it's driven because I need a product or I need an advance in science. The other thing, just if I could quickly, coming back to who manages things, I sit in a very odd organization which I actually haven't been in the government 30 years. I came from a Washington think tank so I came from outside. And everyone who works for me and manages it is only in my office because they're interested in the mission we have. In fact, if Congress and their infinite wisdom would zero out my budget, everyone would go do different jobs. That has a big impact on the culture of an organization. And how... Well, they're certainly paid. They're not volunteers, but they're not in there because they're a federal employee who's shifted from one job to another. They're in there because they think that the nexus of energy environment and the national security is just paramount in their sort of life mission. And they want to accomplish something there. And so that fundamental point that Jeff is making that I do want to underscore is even if the system is tilted against you, you can build these cultural pockets, if you will. And cultural, the cultural aspect, cannot be underscored. And not only that, it's very hard to actually lay it out in a formula because building that kind of esprit de corps is what you're talking about has to be a highly iterative process with the people who are in the room. And I know in my own organization we spend a lot of time on what we call culture and organizational issues. And I have many colleagues in other parts of the agency ask us why we're wasting so much time on that huggy stuff. But it's because exactly that. I've had people tell me that if they didn't work with us that they'd actually leave the government because it is that since those people want to be on the edge of innovation and creativity and breaking new paths. And I think one of the, you know, to echo these points, I think one of the real challenges in trying to make the research enterprise, particularly the federally funded part of it, much more responsive, is figuring out how to, it's the managerial innovation, it's the policy innovation, it's the political, and I don't mean ideological, I mean the small piece of bureaucratic political innovation that a savvy senior executive, you know, career fed, that kind of stuff, not well studied, certainly not well understood. I've spent my time in D.C. and largely as an oversight staffer, very much at the intersection of the political appointees and talking, doing the translation to those senior career feds. And figuring out how to get something done, get the right thing done is grossly underappreciated. When you encounter an SES who really understands not just what needs to be done, what to avoid like a plague and the trickery that it takes. In fact, one of the great things that you always want to do is you want the front end to look as unchanged, unchanging, as humanly possible, and you want all the innovation to sort of pop out as if by magic at the end. Well that doesn't happen in reality. What that means is that you very carefully plot how you make the change and tie analogies that this thing is absolutely in no way, shape, or form different than that thing that you're already comfortable with, but you dig into the details and it's totally different. It is subversive. Since it used to be at OMB and addressed the OMB budget what do you think the engineers need for quantitative metrics even when you're seeking qualitative outcomes? Oh well, I was one of the budget weenies who was asking more for the qualitative. So I'll tell you a very short humor story early when I came to the Department of Defense and I came there because I was interested to do something in the environment but I saw an opportunity and I figured if I can't get it done I'll go back to a think tank where my office was bigger and the staff was more efficient so I asked your authority to write that memo. You can't use that. You can't do that. So I just said, fine. I told myself go to Kinko's. Let's make up a new letterhead. I'm not writing it on their letterhead. I'm writing it on my letterhead. Everyone sort of blinked and said well I guess that's okay. And I was able to communicate and then eventually I got the authority to do what I wanted to do but it would have been a year or two and I came in for 12 months 15 years ago and haven't left but it is easier to seek forgiveness than permission. Yeah, it always is. I think there's some very interesting sorts of conclusions that come out of this. One thing is is that the government agency itself needs a problem. It needs a problem that it has to solve. That isn't just some idle thing for the greater good. I mean, with NOAA you needed to decide that certain people were your customers and that you were going to make them your problem and in your case the DOE had a bunch of problems but you had to kind of label them as problem. And with the QTR you also had an issue of saying you needed a problem in that you needed to be able to figure out a rationale for all this work that you were doing and figure out how to throw some off and keep some in. And the subversiveness of the QTR if you have a lot of spare time and you want to go to the DOE's website and download it, it's very interesting because you can read through it a couple of times on biofuels and go straight ahead on electric batteries for cars. These are electric power trains, hybrid power trains for cars. It's a very interesting document because it turns a lot of things upside down. One thing that came up we're going to open this up to questions in a few minutes but one thing that came up that I just thought was really interesting was this real need for data. Both in harnessing government data and figuring out how to deliver that data on research, data on innovation data on what is successful. One of the things that came out in talking with you, Michael, about what's going on at DOE is how much is hunch driven? How a program can go on for 20 or 30 years based on someone's gut feeling that something's there in what we are celebrating as the height of science in a national lab or something like that. Let's talk a little bit about data. So a point I've made in multiple places that I've been in DC is that compared to other policy arenas labor policy economic policy patent and trademark policy, whatever the case may be health policy etc. there are these enormous data sets that people comb through and have a great ingrained understanding of what's happening in those policy arenas in research policy which I'm sort of constraining to the how we spend this 130, $150 billion a year that we spend on research there is very, very, very little data and it's at its core predicated on expert opinion and expert guidance, you know very talented people coming in and sort of sensing where the opportunities are but the amount of research we're doing is vast and so there's at a point there's only so much that anybody can get their heads around and so even the basic statistics of how we move money out the door at an agency the one and only one that I know is that with an enormous degree of resolution is NIH where they have a well-defined set of mechanisms and each institute sort of racks up what their spending is against that standard set of mechanisms and you can someone could they don't necessarily do then start tracing that through when I tried doing it at the department of energy with budget resolution sort of how OMB the president and congress where they put the money in the pots and then when I try to follow it at the back end how it moves out the building I have to go to a different part of the department and they report it totally different resolution about four or five big lumps and that's about it so trying to understand how an expenditure tied to an outcome that we ostensibly care about is extraordinarily difficult and you know I think the desire that people have to solve that is not terribly great if you are an expert it's a heck of a lot more fun to be unconstrained by well, data so I would disagree with your statement about being able to trace funds I will state and I'm happy to prove it offline you can do that for every dollar we spend in my programs I do remember a GAO investigation in the late 90's when they came to me they were investigating environmental management or a DOE and asked me can you do this I said yeah I assumed DOE can't because otherwise they said yes but the problem comes about when you go to the macro scale of the investments and fundamentally people fight for resources in the government not at least in the Department of Defense not at the macro scale there are top-line budgets and stuff and a top-line budget for how much S&T is going to be invested for the Army and Navy defense-wide and then it's just hand-to-hand combat it's really just convincing people that you've got an issue that either politically or technically or economically needs attention and so there is no analytic work on dividing dollars at the higher level so there's no motivation to aggregate that data so one of the problems we have is we don't even at the bare basic when a lot of people up here on the stage have been talking about basic research and applied research so the official terms definition of that in the federal government is OMB Circular A11 so one time we actually all the R&D examiners pulled together all of the R&D agencies and started saying well okay how do you define it what do you put in that bucket because if a president or a president science advisor wants to invest more in basic research one of the things we ought to be able to say is exactly what's basic so the agencies came in and every last one of them had a different definition of what basic was and in fact some of it, some of the agencies just said well categorically we don't do applied research and we're like well why don't you and they were like well because we're a basic research agency and you're like well that's hairbrain so I would argue so I mean this is just core how do we answer some of these fundamental questions but we don't I think the problem there is is our use of the term basic applied this sort of linear progression you know there's a lot of history of science they would say it never existed but it's really a legacy of the mindset of great physicists from the 20's to the 40's and it's been printed on technology in this country and I guarantee you that in areas where the research is you can even call it environmental so it doesn't make sense I happen to have a weird luxury in the Department of Defense I'm the only program I run which is budgeted in what's called a BA3 you probably know what that means but it's what's called advanced technology development but has statutory authority because of a weird quirk of some congressional things to do basic applied and advanced development under one funding thing so I could ignore it all and figure out okay because in reality interesting all three embedded in one project but the budget process is forcing people to either hide that or constrain themselves right so I'm going to take your question a little more literal about data because we all have excellent data in our silos of excellence and I think one of our greater challenges still unmet is how do we actually begin to share make that data more accessible to more people to share and to leverage if you think about diminishing resources so that's really only become extremely possible in the last decade or so as we've developed easy to use metadata tools and other things like that but I do believe that that's actually where we're going to need to go in the future with constraints on funding because it ranges from highly sophisticated organizations to I'm going to pick on my buddies at the Army Corps of Engineers so they're very data rich particularly around sediment issues but because of the way they get their funding every project has its own file and all their data is still on a sheet of paper inside a file inside an Army Corps district office to study coastal processes all that really rich geomorphological data that's been paid for at a fairly high cost is locked up in a file cabinet in Galveston or Jacksonville or wherever and I got to go pay somebody in the university community to go out and create a lesser quality data set so that I can begin to get to those issues so I think that's a fundamental issue that also inhibits innovation as we roll forward because we have very little ability to learn from one another she makes a great point and it's true more than just coastal process the ecological restoration programs in the core of the same problem if you really wanted to advance the science of coastal processes ecological restorations and stuff there is no way today to do it in a laboratory or even to do it with a simulation and there's no way in a basic science to fund the scale and cost of the Everglades restoration project or the Mississippi restoration project but because we have separated out projects from science we are missing the one opportunity to learn how the real world works and I don't know how to solve this I sit on a number of board of directors for the core and I say the same speech once a year to them and they nod and say yeah but we don't know how to solve it either I sat on their faca and thought to it every meaning too I think it's interesting because this data issue shows that that is essentially the basic research of the government is developing all of this data and in many ways it has already been there have been test cases these are like sort of isolated or sequestered test cases that you can't get out into the public it's like your work taken writ large the successful or unsuccessful programs where the data never sort of gets out into the public sphere we need to take some questions and then I'm going to ask you to react to the phrase government shouldn't pick winners for the wrap up so hit us with your questions and if you can keep them to a question rather than a statement that will be helpful since we don't have a lot of time Hi, Aubrey Wigner, Arizona State University and I was just wondering if you could comment on what I'm seeing as kind of a contradiction with the DOE model for choosing what to research you said the new technology must be competitive in a non-subsidized manner and it must also compete with current technologies but all of our current energy technologies are heavily subsidized like oil and gas and coal so is that inherently restricting us to pursuing further oil and gas and coal? So that's sort of a rule while it may appear unfair is political reality you can argue again argue the equity of it but unless you have a political strategy for stripping away those subsidies for the incumbents then the actual competitive environment faced by a new entrant is asymmetric and you either develop the technology to compete in the world it competes in or you develop it for one that it will possibly not ever compete in and it will never be used so unfair or not unfair is not relevant that's the way it is and so until you have your political strategy for changing that then develop to the world you face. If I could follow up on that there was when you mentioned John Lawrence when you mentioned the Tokamak as an example if I had to think of what a private equity firm would describe as a disruptive technology that's it and so if the government isn't the one who's going to spend money to develop a disruptive technology that has potentially huge externality savings that are not taken into account in current market pricing then who is going to make the kind of radical change that this conference is trying to discuss and think about? So I think having done as much oversight of federal R&D programs as I've done I'm just unsympathetic to that world view the reason we are spending public sector funds is to solve public policy problems and the lack of technology or equity among technologies is not something I believe is a public policy problem a clean environment clean affordable energy well educated kids a secure retirement for the elderly I think those are public policy problems that need solution the notion of equity among technologies is not something I will sign up for and so disruptive technologies have to go through multiple other criteria there is a technical criteria there are financial criteria there are regulatory criteria there's public acceptance criteria if there are waste issues you got to solve those before you launch them there are all sorts of things but the notion of disruptive technologies considered in isolation is not something that I think there is a public policy justification for I think it's an interesting flip of the innovation paradigm that innovation means to take the money ball metaphor it means finding like the most amazing picture whereas if you look at the book money ball and the team what you're actually doing is you try to figure out how to optimize your funds for the greatest you want to win the game because I actually have used the money ball analogy a number of times with people in DoD there are two approaches and I think you have to pursue both in R&D funding one is as I say to friends I've made my living hitting doubles and keeps my average up and I get lots of money by doing it but you do want people swinging for the fences sometimes and what you want to do is segregate those into different funding organizations I think that's what ARPA is trying to do to some sets of DARPA where you're trying to have a disruptive technology and it will not you have to give a lot more freedom to it the concern I have sometimes is it's easy to just get enchanted by that and I think that's all you have to do and in fact in the energy space that's difficult to do it is with the exception of a few type of technologies you can think of we're not actually talking about improving any competitive advantage in terms of a business you're talking about either decreasing externalities or bringing something in for lower cost and so how that works with this disruptive approach versus the more money ball approach let's call it is complicated but I think you need both in some sense in the government I think we have time for one more question it's one of the political questions SIRTEP has been an extremely successful program not just technically but in terms of public relations politically in spite of the fact that it's easily parodied green bullets in spite of that though so with the environmental work you guys were successful politically with energy where Rommel's experience would tell you yet diversification of energy sources is important you're getting hammered what happened I do think SIRTEP has been successful I'll actually point out last week Saturday Night Live in their weekend update highlighted one of our projects it's a funny bit it's actually a useful project they didn't recognize it as SIRTEP that has been the one thing that's impressed my children but we were successful in so we were the only environmental program during the Bush administration whose budget went up that I know of and it was because we were very careful how we described it and we were completely honest but we didn't talk about the externalities we talked about the defense mission I think when you're in the Department of Defense we're getting a mixture of praise and criticism about the energy front I don't think anyone who's knowledgeable there's wackos out there so we'll put them aside criticizes us about the need for energy efficiency at the front lines for energy efficiency at our installations for the Marine Corps deploying photovoltaics and things like that out in Afghanistan what we're getting hammered on is the biofuel issue and I think they have happy to talk offline about that trying our investments to the clear national security mission of DOD there's a broader national security mission in this country but DOD has a large part of it and I think that's where they're having trouble convincing people right now alright so I want to wrap up this panel it's been a very interesting and free flowing discussion and what I want you to do the sort of rallying cry is government should not pick winners any kind of a quick reaction to what that means we've talked about this offline so when I've worked with other agencies particularly EPA historically we can't pick winners or losers it's not our job I've always in the Department of Defense have a job to pick winners or losers and I tell my boss if I don't have a reasonable batting average you should fire me and hire someone else because I'm trying to solve a mission it's very hard though for other federal agencies if they're not an end user of the technology to do that we are able to do this in a variety of areas in energy, environment and I would argue where working with NOAA and stuff going to start looking at how do we adapt to climate change on our military installations and again we will pick the approach we think is right we're not going to say other people have to use it but we'll certainly use it inside so I do think organizations have to pick winners or losers you have to be careful about the politics of it and for a number of reasons DOD is immune to getting criticized for it and how about those who are not immune well I do appreciate the DOD is immune to lots of challenges that the rest of us face on a daily basis so I work with programs that have regulatory functions associated with them and I used to be a lawyer so I'm very clear that you have to have a track record about how you treat information and you treat individuals and permit applicants you at least have to have a clear and defensible record I actually personally tend to agree with Jeff at the end of the day there is always a winner and loser if you're a public sector person you'll probably talk more about the winners and a lot less about the losers and I think a great quote that goes with this so I don't know why physicists are some of the most active political scientists not as political scientists but politically oriented scientists but there was this guy named Einstein who did say yes, yes, yes exactly that politics was so much harder than physics so I think that's what our jobs are about we work with physics but we're really having to be mindful of politics in order to let the physics are the biology advanced so last comment to me you shouldn't pick winners and losers the battle cry of distributional politics where everybody wants it means pick me, I'm a loser often times not absolutely and the score did well so well it is motivated by distributional political concerns that doesn't mean they're losers but it is certainly that's part of the motivation I think as long as you focus on what the public policy problem is that you're trying to solve what is that goal that has motivated a public expenditure whether and delivering value to the taxpayer as long as you keep that in focus there are lots of forces that are trying to bring other concerns to the fore but I think as long as you maintain that focus on what your public policy purpose is you have you're always able to make much more coherent, compelling arguments for a good investment that can actually move the ball down the field than just sort of saying oh my gosh we can't make any decisions thank you very much, this is a wonderful panel applause ah yeah right