NOBEL PRIZE IN PHYSICS awarded for pioneering experimental contributions to lepton physics with one-half to: Martin L. Perl, Stanford University, Stanford, CA, for the discovery of the tau lepton, and one-half to: Frederick Reines, University of California-Irvine, Irvine, CA, for the detection of the neutrino. NOBEL PRIZE IN CHEMISTRY awarded jointly to: Paul J. Crutzen (Netherlands), Max Planck Institute for Chemistry, Mainz, Germany, Sherwood F. Rowland, University of California-Irvine, Irvine, CA, for their work in atmospheric chemistry, particularly concerning the formation and decomposition of ozone. NOBEL PRIZE IN PHYSIOLOGY OR MEDICINE awarded jointly to: Edward B. Lewis, California Institute of Technology, Pasadena, CA, Christiane Nüsslein-Volhard, Max Planck Institut für Entwicklungsbiologie, Germany, and Eric F. Wieschaus, Princeton University, Princeton, NJ, for their discoveries concerning the genetic control of early embryonic development. BANK OF SWEDEN PRIZE IN ECONOMIC SCIENCES IN MEMORY OF ALFRED NOBEL awarded to: Robert E. Lucas, Jr., University of Chicago, Chicago, IL, for having developed and applied the hypothesis of rational expectations, and thereby having transformed macroeconomic analysis and deepened our understanding of economic policy. 1996 NOBEL PRIZE IN PHYSICS awarded jointly to: David M. Lee, Cornell University, Ithaca, NY, Robert C. Richardson, Cornell University, Ithaca, NY, and Douglas D. Osheroff, Stanford University, Stanford, CA, for discovery of superfluidity in helium-3. NOBEL PRIZE IN CHEMISTRY awarded jointly to: Robert F. Curl, Jr., Rice University, Dallas, TX, Richard E. Smalley, Rice University, Dallas, TX, and Sir Harold W. Kroto, University of Sussex, Brighton, U.K., for their discovery of fullerenes. NOBEL PRIZE IN PHYSIOLOGY OR MEDICINE awarded jointly to: Peter C. Doherty (Australia), St. Jude's Hospital Memphis TN, and Rolf M. Zinkernagel, University of Zürich, Switzerland, for their discoveries concerning the specificity of the cell mediated immune defense. BANK OF SWEDEN PRIZE IN ECONOMIC SCIENCES IN MEMORY OF ALFRED NOBEL awarded to: James A. Mirrlees, University of Cambridge, U.K., and William Vickrey, Columbia University, New York, NY, for their fundamental contributions to the economic theory of incentives under asymmetric information. For example, in the mid-1980s European scientists discovered high-temperature superconductors. Immediately, American investigators with the requisite expertise turned their energies with great success to extending and exploiting this discovery, both in terms of fundamental understanding and engineered applications. Given the growing linkages among the scientific and technical disciplines, it is impossible to predict what expertise will be indispensable for future developments. As with any investment portfolio, certain areas will be emphasized at any given time because of special opportunities for progress and impact. The Federal portfolio, however, must remain broad-based and accommodate the high-risk investments that may have enormous long-term impact. It is increasingly evident that the major fields of science and engineering mutually catalyze one another strengthening the fabric of science and, with it, the entire science and technology enterprise. By advancing all frontiers of knowledge, creative American scientists and engineers, along with their students, enrich the present and shape the future. Scientific breakthroughs spur new technologies that, in turn, enable improved scientific capabilities to explore the unknown. It was not until the mid-1980s that physics understanding, niobium purity, and ultraclean manufacturing and processing techniques made it feasible to build a superconducting electron accelerator needed to explore the innermost structure of the atom's nucleus. The world's largest assembly of superconducting accelerator cavities is now at the Department of Energy's Thomas Jefferson National Accelerator Facility in Newport News, Virginia. The nondefense R&D/GDP ratios of both Japan (2.7 percent) and Germany (2.4 percent) considerably exceeded that of the United States (2.0 percent) in 1993 and have done so for years. The nondefense R&D ratio of France matched the ratio of the United States; the ratios of the United Kingdom (1.9 percent), Canada (1.5 percent), and Italy (1.3 percent) were somewhat lower. In this time of constrained resources, some have argued that less emphasis should be placed on basic research, since its results are typically available to anyone in the world. Japan, for example, has developed strong market positions for some products, particularly consumer electronics, for which American scientists did much of the original research and development. The Administration rejects this simplistic argument. The dominance of our basic research enterprise is a core American strength that must be preserved. This enterprise, in addition to producing new knowledge that is indeed appropriable by others, generates the physical and human infrastructure that underlies our national innovation system and our society's resourcefulness in the face of rapid technological change. We also must remember that basic research repays society in the near term through newsworthy discov (Left) The diversity of Federal sources of basic research funding, and the variety of institutions and organizations conducting the research contribute to U.S. leadership across the scientific frontiers spanned by the Federal scientific and technical research portfolio. ogy and biotechnology, business technologies, multimedia technologies, and others - increasingly support expansion of our export economy. America's economic resilience, as demonstrated in the rapid recovery of our leadership in semiconductors over the last five years, is clearly tied to our strength in science and technology, especially the basic and applied research capacity and human capital that spring from our research universities. Indeed, it is noteworthy that Japan's decision to dramatically increase research funding emphasizes strengthening its research universities. Competitive advantages clearly accrue to nations fashioning the future through investments that return new, basic knowledge. Although our total investment in non-defense research and development remains the highest in the world, it is only 75 percent that of Japan and 85 percent of Germany's as a fraction of Gross Domestic Product (GDP). We must not let our position erode and thus compromise our future. ADVANCING THE FRONTIERS OF SCIENTIFIC KNOWLEDGE Maintaining U.S. leadership across the frontiers of scientific knowledge is achieved through investments by numerous Federal agencies that span all fields of science and engineering. Diverse combinations of expertise and approaches, along with teamwork and collaboration, contribute to the steady progress and major breakthroughs advancing today's frontiers. By bringing specialists together to tackle problems that transcend disciplinary boundaries, we cross-fertilize scientific fields and spur further advances. The five thrust areas discussed below typify the breadth of Federal investments and the multidisciplinary character of today's frontiers of knowledge. Many Each theme listed below represents an area of emphasis in our Federal research portfolio: • Origins of the universe, solar system, and life Understanding earth systems • Materials research • Medical advances through genome research • Human learning and potential In each area, several Federal agencies bring to bear powerful capabilities and complementary perspectives. The research enlists the talents and institutional resources of the best university faculty and students, government and national laboratory scientists and engineers, and industrial researchers throughout the nation. Priority goes to efforts that are judged most worthy of taxpayer investment on the basis of merit review and that also serve the missions of the Federal agencies. The competition for resources is fierce. Annually our nation's scientists and engineers submit some 70,000 proposals just to the NSF and NIH for scientifically sound and worthwhile studies - easily three to five times more than can be funded. ORIGINS: SEARCHING FOR ANSWERS TO FUNDAMENTAL QUESTIONS ABOUT THE BIRTH AND At present, scientists can claim a rudimentary understanding of the physical evolution of the universe from about 10-35 seconds after the start of the Big Bang to today Recent discoveries by space-based instruments, such as the Hubble Space Telescope, by NSF's ground-based observatories, and by a new generation of large privately funded telescopes, have made recent years outstanding ones for astronomy. We now have strong observational evidence for formerly exotic theoretical concepts such as black holes, one of which may lie at the center of our own galaxy. Most scientists now agree that modern discoveries confirm that there was a cataclysmic moment of creation -- the Big Bang that gave birth to the universe. And at about the same time the fundamental structure of matter was being determined, small breaks in the otherwise uniformly smooth fabric of the universe were setting the stage for the forma This eerie, dark pillar-like structure in the Eagle Nebula in this Hubble Space Telescope image is actually cool interstellar hydrogen gas and dust incubating new stars. Stars are born when clouds of dust and gas collapse because of gravity. As more and more material falls onto the forming star, it finally becomes hot and dense enough at its center to trigger the nuclear fusion reactions that make stars, including our Sun, shine. While we have answered many age-old questions, the progress of the past several years has forced new questions upon us. We do not know the exact paths along which galaxies, stars, and planetary systems evolve. Only within the past two years have we discovered possible planets around other stars. We do not completely understand the Sun's impact on processes here on earth. We are only beginning to explore the detailed features of our nearest planetary neighbors. These new questions have prompted a natural shift to an "origins" perspective. Because understanding the evolution of the universe, including the life within it, takes the combined contributions of astrophysics, space science, particle physics, nuclear physics, exobiology, and chemistry, the broad questions of origins now connect many of the nation's scientific efforts in a highly complementary way. For example, while astronomers using NASA spacecraft and NSF observatories are focusing on large-scale galaxy formation and planetary studies, complementary work in particle and nuclear physics is being conducted at DOE and NSF accelerators to understand the structure of matter at its most fundamental level and how that structure was manifested in the first few minutes of the universe. Such studies will continue in the future with American scientists working at the Large Hadron Collider in Europe and at new U.S. facilities such as DOE's Relativistic Heavy Ion Collider on Long Island and its B-factory in California. New Administration budget initiatives also strengthen NASA's research efforts to look for earthlike planets and nascent galaxies by advancing the launch of the Space Infrared Telescope Facility and initiating preparations for interferometry, both on earth and in space. And because every prior improvement has revealed unanticipated astronomical wonders, the Administration is supporting even more advanced facilities, such as NSF's twin Gemini Telescopes and Phase 1 of the Millimeter Array, and NASA's Advanced X-Ray Astronomical Facility and the Next Generation Space Telescope design. In parallel with this research to understand the evolution of the physical universe, the quest to understand and explore the staggering diversity of life on earth is on our own bringing together experts in biology, chemistry, earth sciences, oceanography, polar studies, astronomy, and ecosystems. More and more, we find life forms thriving in extreme environments, with water in some form being the only apparent necessity. Only last year scientists decoded the genetic material of an archaeon, confirming that it represented a third and previously unknown branch of life the Archaea planet. Collectively these discoveries provide insights into the possibility for life elsewhere in the universe. The analysis last summer of a putative Martian meteorite found 20 years ago in Antarctica has whetted the public's interest to find solid evidence of life on other worlds. Now two new probes are off to Mars, and more are planned, including the retrieval of appropriate samples from Mars. Clearly, a discovery of life beyond earth will provide a landmark in mankind's millennia-old quest to understand our place in the universe. LEARNING HOW TO ENSURE EARTH'S LONG-TERM HABITABILITY Because of both natural and manmade causes, our earth undergoes local, regional, and global changes on time scales ranging from momentary to geological. Humans and other creatures affect earth's habitability by just living. In fact, over eons, photosynthesis by early plants on the ancient earth created the oxygen-rich atmosphere we and other animals breathe. Now, to maintain our high standard of living we convert vast quantities of energy and raw materials into forms we desire, consume, and often discard. This consumption has adverse effects on the earth's air, water, weather, landforms, and agricultural productivity. The U.S. Global Change Research Program coordinates the efforts and investments of 13 Federal agencies and collaborates with international partners to study these problems. A fundamental challenge of our age is to understand how numerous natural and human phenomena interact to influence global habitability. Earth's orbit, plate tectonics, earthquakes, volcanism, ocean currents, storms, drought, erosion, fires, mining, manufacturing, agriculture, electricity generation, and transportation are among the processes that affect the environment. Our goal is to understand - even predict - the natural phenomena, and to learn how to maintain — even enhance - our standard of living and that of people in developing nations while sustaining earth's habitability for future generations. Today, scientists use observations, models, and the geological record to answer questions such as the following: How fast and why does climate change? What |