The growth of our economy and in particular our industry is directly tied to the quality of the entire U.S. system of education and the labor force it produces. Public Education (K-12) in the U.S. is, on the average, demonstrably non-competitive with that in Japan, Germany and the USSR in mathematics and the sciences. The revolution of the computer has caught our educators at secondary schools unprepared. We are now entering a catch-up period. The loss of gifted youngsters to science and engineering careers because they do not receive an adequate math, science and computer literacy education is one manifestation of the problem. But even more important is the current and future level of "technological literacy" in the workforce as a whole, when the tools of work increasingly call for mental skills. Industry is woking to combat these deficiencies. For example, IBM has the following programs underway: 1. $50 million (over a three-year period) in CAD/CAM equipment and curriculum development grants in engineer ing schools to motivate and train engineers for careers in high productivity, through the use of automated manufacturing. 2. Over 400 cooperative research projects between university and IBM laboratories in close to 100 U.S. institutions totalling a multiyear commitment of about $60 million. 3. Funding 200 graduate fellowships, awarded by merit in 4. Faculty loans of over 60 IBM professionals to universities and secondary schools annually, including several 5. Joint funding with other companies of the Semiconductor 6. Grants of funds and contribution of Personal Computers Teachers and students in selected secondary schools will be up to 1,500 Personal Computers and related software to a program designed to help schools get maximum benefit 7. Other grants to educational institutions for faculty future. While these activities are substantial, it is important to remember that total industrial support for academic R&D in the U.S. is less than 7% of the total. Similarly, total industrial philanthropy to higher education in the U.S. is less than 3% of university operating costs. Thus, while industry support for research and human resources has very important direction-setting influence on academic institutions, it is not a substitute for substantial private and governmental support, on which universities must depend. IBM supports in concept S. 1194 and S. 1195 which are significant efforts to address this critical need. They include additional incentives to industry to provide certain scientific and computing equipment to our schools and in other research activities. A beginning occurred in 1981 with enactment of Internal Revenue Code Subsection 170(e)(4) but there is a need to clarify remaining uncertainties of that legislation and expand the incentives as reflected in S. 1194 and S. 1195. A. O. Smith Corporation, Milwaukee, Wisconsin ROBERT H. MALOTT.. FMC Corporation, Chicago, Illinois GERALD B. MITCHELL AMP Incorporated, Harrisburg, Pennsylvania Brown & Sharpe Mfg. Co., N. Kingstown, Rhode Island CRAIG R. SMITH RICHARD B. STONER Cummins Engine Company, Inc., Columbus, Indiana MACHINERY and ALLIED PRODUCTS INSTITUTE 1200 EIGHTEENTH STREET, N.W. WASHINGTON, D.C. 20036 202-331-8430 The Machinery and Allied Products Institute (MAPI) is pleased to have this opportunity to present its views to the Senator Danforth and others to make permanent the credit for 1/ We understand that the hearing on S. 654 of Senator this time. MACHINERY & ALLIED PRODUCTS INSTITUTE AND ITS AFFILIATED ORGANIZATION, COUNCIL FOR CTA increasing research activity; and S. 1194 of Senator Danforth and S. 1195 of Senators Bentsen and Chafee to increase the charitable deduction for certain gifts of computers and scientific equipment, to expand the tax credit for research activities, and to extend the exclusion from income for certain amounts received by students. Our statement is submitted pursuant to Senate Finance Committee Press Release No. 83-139 by which interested parties have been invited to express their thoughts concerning bills under review by the Subcommittee in the hearing of May 27, 1983. We ask that our statement be included in full text in the printed record of the hearing. As the Subcommittee may know, MAPI is the national organization of producers of capital goods and allied products. In that capacity, the Institute represents industries manufacturing and marketing the facilities of production, distribution, transportation, communication, and commerce. More specifically, MAPI's membership includes corporations in a number of the most research-intensive industries in the United States, such as, machinery, including office, computing, and accounting machines; electrical equipment; professional and scientific instruments; motor vehicles and related equipment; aircraft and missiles; and, to some extent, chemicals and allied products./1 The Institute's member companies produce highly engineered--often state-of-theart--goods that are sold worldwide, and technological advancement is 1/ According to an April-June 1982 survey by the National Science Foundation (NSF), company-funded--i.e., excluding governmentfunded sums--R&D for these industries is expected to reach $40 billion in 1983, Science Resources Studies Highlights, NSF 82324, September 9, 1982. |