baselessly bad-mouth the program as a planned way of generating opposition to it. Examples:

A. "This is not a good program from a research standpoint; it's all

politics."

B. "This program can't produce anything but junk research and second rate results."

C. "There may be a handful of competent, small high tech firms, but they are far too few to justify the existence of this program."

D. "Just the fact that this program is based on a set-aside means that it cannot also really be based on merit and excellence."

(This is a particulary offensive and false characterization of what is
clearly the most competitive merit-based R & D program the federal
government has ever had. It is monstrous to confuse it with programs
based on set-asides that are not competitive and have nothing to do
with merit. "De facto set-asides" for government laboratories,
universities and large companies have existed for years and still
exist.)

E. "The present administration is really not in favor of the program, despite the fact that both the President and the Vice President have clearly, repeatedly and vigorously expressed their support of the program."

(What sustains this drumbeat of distortion I do not know. It must be

said that some of it at least apparently originated or is attributed to

the Office of Management and Budget.)

(5) Sabotage by Silence. This happens when major spokesmen for agencies which make policy on a wide range of research and technological fronts somehow never get around to mentioning either this program or the utility of small high tech firms in the government's science and technological efforts generally. It does not take long for five or six such omissions to be read, quite properly, I believe, as a silent but clear signal as to the views of the spokesmen.

(6)

Sabotage by Unreasonable Impatience. This takes several forms. In my own experience, it takes a minimum of two years for small business people throughout this country to learn about new federal programs of direct concern to them. It is not surprising that some firms which should not be making proposals are making them. Or that a process which must take three, four or five years has not yet produced a wide range of proven breakthroughs.

(7)

Sabotage by "The Higher Mission". This takes the form of giving token houseroom to the program, but always finding that it cannot be funded adequately because of the higher-priority needs of public health, defense, basic science, etc. The real goal here, as against the ostensible one, is to deny the program the opportunity to prove what it can contribute to the cheaper, faster, better achievement of small parts of those very "higher missions."

(8) Sabotage by Reorganization. This is an extreme form of this attitudinal disease. It crops up from time to time in the name of "streamlining functions" or "rationalizing budgets and expenditures."

(9)

Sabotage by Exploitation of Fear and Greed. It is now explicit that one third of Phase I grants are available to universities and other non-profit institutions, and that one half of the Phase II grants are available to them. That may be as much as $400,000,000 over 5 years. All they must do is achieve good working relationships with successful small business applicants. We will be working hard to help that to happen. There are nevertheless, still people in the government and in academic management who view this as a turf raid rather than a cooperative opportunity.

(10) Sabotage by Phony Ideology. There are people both in government and in the private sector who are passionately eloquent in arguing that what this program does should "be left to the private sector". Some day years from now, they may be right. If the program is allowed to succeed, some or much of it may prove to be transferable to the private sector. But we are at best a long way from that point, although we will be working to bring it closer. Without this program's seasoning, it will simply not happen.

The fullest possible success of this program will be achieved by giving it the most opportunity either to prove its value or to prove its worthlessness. It is probably too soon to try to learn too much from what experiences we have had. These suggestions may be premature, but they may be worth thinking about if only for the future:

1) Are there not other agencies than the eleven who have been mandated to take part in this program which can use SBIR solicitations to save money and improve research procurement? Could they not be grouped in a single solicitation to be

administered by SBA, NSF or some other agency (We need for example, great

technological advance in the housing field; HUD may find this a good way to get some of

it).

2) Six of the eleven agencies have essentially miniscule programs. Could they not avoid the risk that the best companies will decide the odds against success are too long by raising the number of grants to 30, 40, or 50 a year, not to speak of 100? Are there not elements of other non-competitive, non-productive programs that might benefit from a comparative use of the SBIR approach?

3) Is there not a level of "high" high tech breakthroughs that a number of agencies would welcome, but no one agency is likely to include for itself? Could there be a specific solicitation limited to such subjects and managed by one of them?

4) When agencies have an embarassment of proposal riches-more high quality fundable proposals than their budgets permit-would it not make sense to publish "honorable mentions" for those firms passed over in the final selection, solely because of budgetary limits? That would help the private sector and the states to develop additional sources of support.

Whether I have succeeded in articulating it myself, what I urge on this Committee is a balanced view. Such a view should bear in mind four critical points. First, the small business share of federal R & D is almost surely lower today than it was when this program was authorized. Whether agencies are cutting small business shares elsewhere because of this program should be determined by the Committee. Second, on R & D procurement, the Executive branch has never yet come within hailing distance of even the 30% range of general federal prime and subcontracts that small business appears to get. Third, this particular program is off to at least as good a start as we had any right to expect. All of those federal people involved have good reason for pride in that. But, fourth, there is still a risk that disillusioning half-heartedness or attitudinal sabotage may yet again cost the Nation the full participation of its smaller high technology firms.