.The University of Private Enterprise

The infusion of corporate cash at UC Berkeley has drastically changed the type of scientific research conducted on campus.

In April of 2010, British Petroleum’s offshore drilling unit Deep Water Horizon exploded in the Gulf of Mexico. Eleven workers died, 210 million gallons of oil leaked into the ocean, and 665 miles of coastline were contaminated. It was the biggest accidental marine oil spill in US history.

Just one month after the ruptured well was sealed, UC Berkeley ecologist Terry Hazen made a groundbreaking discovery: He identified a new microorganism that was eating the spilled oil and breaking it down into CO2 and water. The microbe was so active that, according to Hazen and his team of scientists, the vast plumes of oil in the gulf had “went away fairly rapidly after the well was capped.” Hazen’s findings were published in the academic journal Science, and subsequently reported by most major media outlets. One fact, however, was often omitted: The research was funded by BP.

Such a pairing is possible because in 2007, UC Berkeley, the University of Illinois, and BP signed a ten-year, $500 million research agreement that funded work on biofuels and genetically modified organisms (GMOs). “When people read the Science report, they thought they were reading a Berkeley professor’s research,” said Ignacio Chapela, professor of microbial ecology at UC Berkeley. “They didn’t realize it was also BP saying, ‘You shouldn’t worry about the oil spill anymore.'”

Over the past fifteen years, UC Berkeley has experienced an explosion in privately funded research. In 2002, the engineering department’s CITRIS lab, which conducts energy, transportation, and medical research, received an initial investment of $75 million from dozens of industrial partners. The lab continues to secure roughly $50 million a year in both federal and private grants. In 2012, the Energy Biosciences building was constructed with more than $90 million from numerous private investors. And last spring, Texas Instruments gifted $2.2 million to UC Berkeley’s engineering department to upgrade classrooms and labs.

The infusion of corporate cash at UC Berkeley also has drastically changed the type of research being done at the university. For decades, much of the research on campus was federally funded and driven primarily by scientific curiosity. The results of this basic research allowed the public to better understand such concepts as genetics, the origins of humanity, and the laws of physics. It also won UC Berkeley numerous Nobel prizes.

Federal agencies still fund the majority of research at UC Berkeley. But the university, and others like it across the nation, have experienced a forty-year decline in federally supported basic science research because of government cutbacks. The rise of corporate funding, in turn, has spawned a dramatic increase in the amount of applied research on campus. It’s typically funded by industry and aims to develop products that can be quickly brought to market — and create corporate profits.

This fundamental overhaul of scientific inquiry at the nation’s top research universities has many concerned that the public-service element of science is dying. At the same time, some pragmatic researchers have accepted the new private-public paradigm and are working to identify the right safeguards to ensure that industry doesn’t wield too much power over academia. “You can have private money in the sciences, it just has to be done right,” argued engineering professor David Dornfeld, faculty head for the Advanced Manufacturing Partnership, a massive public-private partnership currently being drafted at UC Berkeley. “You have to be careful how it’s perceived, you have to have oversight, it has to be transparent, and it has to be consistent with the core mission of the university.”

Nonetheless, some students say that, even with protections in place, the presence of corporate sponsorships on campus impacts decision-making, as more researchers gravitate toward projects that are well-funded and could result in industry jobs down the road. In short, scientific research at the university level is at a crossroads, and the direction UC Berkeley chooses to take will have implications that reach far into the future.

Until the 1940s, all university research was essentially financed by private industry. However, just before the US entered World War II, President Franklin Roosevelt began enlisting academic scientists to support the wartime effort. Shared facilities — in which researchers from across the country collaborated with the US military to develop weapons — were built.

The success of these programs prompted the federal government to rethink its involvement in the sciences. In a 1945 report, “Science: The Endless Frontier,” Vannevar Bush, head of the US Office of Scientific Research and Development, explored the possibility of creating government agencies to fund basic research at universities. He argued that “scientific progress is one essential key to our security as a nation, to our better health, to more jobs, to a higher standard of living, and to our cultural progress.” Therefore, Bush believed, “the federal government does not only have the authority but, indeed, the obligation to support research, particularly basic research, in universities.”

By 1950, the federal government had established a number of agencies to award research grants to universities. And by 1953, it was funding 55 percent of the research performed in US universities. By 1970, it had grown to 70 percent. At that point, industry funded just 3 percent of research conducted at US universities.

The Fifties and Sixties were commonly referred to as the “golden era” of science. Universities made numerous groundbreaking discoveries, and American scientists led the world in the number of Nobel prizes collected.

However, between 1970 and 1995, government funding for research and development fell by more than 50 percent. While it rebounded slightly between 2001 and 2005, it has since resumed its long-term decline. And the recent automatic federal budget cuts known as sequestration could lead to a loss of an additional $8.6 billion in federal research grants in the coming year.

The impacts of the sequester can already be felt at UC Berkeley, where federal support for the sciences has dramatically shrunk for the 2012-2013 academic year. Some UC officials are asking Congress to reconsider these cuts, as they will have a devastating impact on research. “The UC is playing a leading role in our nation’s economic recovery, and it’s a critical engine of innovation,” said Gary Falle, vice president for Federal Governmental Relations at UC. “We will … continue to advocate for strong funding for basic research so that scientific discoveries can continue to move forward.”

In the past three decades, privately funded applied research, however, has skyrocketed at US universities. Between 1985 and 2005, it increased by 250 percent, from $950 million to $2.4 billion.

This explosion of corporate dollars being directed to universities has also sparked controversy and raised concerns about scientific bias. A 2006 investigation by the San Jose Mercury News found that one-third of Stanford University’s medical school administrators and department heads reported financial conflicts of interest related to their own research. And another report by the British Medical Journal in 2010 found that pharmaceu­tical-industry-funded research was four times more likely to reflect favorably on a drug than research not financed by said industry.

The first big public-private partnership came to UC Berkeley in 1997, when the Swiss biotech company Novartis entered a five-year, $25 million contract on GMO research with the biology department. It was the first time that nearly an entire academic department signed an agreement with a single firm.

At the time, Professor Chapela was the biology department’s faculty representative, and he heard a plethora of concerns from professors regarding the agreement. Some disliked that Novartis would receive intellectual property rights to research results. Others worried that layers of confidentiality agreements went against the core principles of academia. “Still, the administration seemed ready to go ahead,” said Chapela. “There was this feeling that there was nothing we could do about it because the decision had already been reached.”

But the deal also generated widespread protest from students, faculty, and community members, who felt that the university’s academic reputation was tainted by the partnership. “There are intellectual spaces that should be absolutely clean and protected from the influences of private partners,” said Chapela, “and I don’t see any way in which you can do that when you have money directly given to a program. … Once you start working to promote the industrial sector, there are certain questions you’re not allowed to ask.”

Over the course of five years, the research deal produced no dramatic discoveries and Novartis didn’t license any products. In other words, it was a financial bust for the corporation. Plus, it was a loss for the university. A 2004 UC-funded review of the Novartis agreement found that the damage done to Cal — including infighting among faculty and negative press coverage — didn’t justify the money that it received.

Lawrence Bush, the study’s principal investigator, wrote that the agreement was a “lightning rod for numerous concerns about the role and purpose of the university,” and that before UC Berkeley embarks on future public-private partnerships, it should have an open dialogue about the goals of working alongside industry. “As a recognized national leader in higher education, with a strong and vibrant tradition of faculty governance, UCB is perhaps best situated as a place to begin a serious debate,” concluded Bush, “and, as a leader, perhaps it has an obligation to do so as well.”

The UC system is projecting a $2.5 billion structural shortfall by 2015, and the university’s financial managers have no concrete plans to address the crisis. As a result, private money has continued to flow into Berkeley’s hard science departments with little public input.

To deal with this new funding model, many professors are trying to ensure that academic integrity remains intact. And with the exception of the BP agreement, they have — by and large — been successful. Most public-private partnerships at Cal involve multiple companies, don’t encompass entire departments, and include safeguards to ensure that the basic principles of academia are preserved. In turn, many professors believe that the situation has improved: “In the old days, there was an element of people doing superb research and then publishing it in the literature and then hoping something good would happen,” said Paul Wright, director of the engineering department’s CITRIS lab. “Now, organizations like ours have developed, and we can more easily take those brilliant research ideas and turn them into commercially oriented products.”

CITRIS is a seven-story glass edifice in the middle of the engineering quadrant. The lab receives between $50 and $60 million a year in research grants, roughly a quarter of which comes from its 36 corporate partners, including IBM, Hewlett-Packard, and Intel. Despite being heavily funded by industry, CITRIS is a public good, Wright said. “Everything we do has to be a part of the open literature …. None of it is exclusive, it can be licensed by anybody.”

Some other public-private partnerships, such as the one Cal has with BP, designate a portion of the research results as property of the investing company. Wright also noted that professors have full autonomy in choosing what to research at the CITRIS lab. “No one is telling me what I should work on as a faculty member, and the students have the same freedom as well.”

During the fall semester, I spoke with a half-dozen graduate students after a class at CITRIS. All of them believed that, thanks to the protections put in place by Wright and his colleagues, the benefits of working alongside industry outweigh the dangers. But it was also apparent that the presence of corporate sponsors on campus is affecting students’ views of basic science research. “As an undergraduate, you learn all of this theory and it’s nothing practical,” said Alex Heller, an engineering Ph.D student. “With these corporate entities, though, I can see where this skill set is practical, and where I can use it in the future.”

Mark Fuge, a third-year engineering Ph.D student, said that having corporate sponsors gave him a certain level of financial security that he would otherwise lack. “It’s a couple thousand dollars for a company to sponsor a team,” he said. “That’s nothing for them, but for the teams, having a working budget to develop these technologies is everything.”

One student noted that having access to private funding also affects choices made on campus. “A lot of times, without even noticing it, I chose to work on something just because it will let me be funded,” said physics Ph.D student Shiry Ginzaw. She added that she doesn’t do basic science, in part, because there’s likely no financial payoff in the near- or long-term. “I think basic research is interesting, but I don’t do it because I wouldn’t be paid as a physics student, and I probably wouldn’t find a job afterwards. … A lot of the choices I’ve made are because the money is in one place and it’s not in another.”

During the 1970s, roughly 62 percent of government-funded research was basic research — science for the sake of science. Between 2000 and 2010, that number dropped more than 12 percentage points. Government, in other words, has not only cut scientific funding overall, but the research it is funding is increasingly geared to help corporate America compete in the global marketplace.

At UC Berkeley, a school once dedicated to pursuing long-term scientific discoveries, research is more often viewed today as an engine for economic growth. As one English professor put it during a panel discussion on the future of the UC last year, “administrators are attempting to turn the university ever more completely into an institution of global capitalism.”

UC Berkeley’s Energy Biosciences Institute, for example, is the largest public-private partnership of its kind in the world. Primarily funded by BP, the institute is trying to develop cheaper and more efficient biofuels. While the resulting technology could provide widespread benefits, BP’s main goal is to position itself as a leader in the potentially lucrative world of alternative energy technologies.

Another growing field of applied research on campus is robotics. The global market for robots is expected to grow from $1.3 billion in 2009 to more than $5 billion in 2015. The CITRIS lab recently partnered with Silicon Valley robot developer Willow Garage to create a robot that can fold clothes. CITRIS researchers are also working to develop a robot that can assist in surgery. The Berkeley Laboratory for Automation Science and Engineering also specializes in robotic research, and has eight corporate partners.

The Advanced Manufacturing Partnership (AMP) is another example of a market-driven research project. However, unlike some other public-private partnerships, the AMP is composed of a wide range of public and private agencies, nonprofits, and universities, including Cal. Although its goal is much loftier than creating profitable products for individual companies, it nonetheless emphasizes applied research rather than basic science. The AMP is designed to help reinvigorate the nation’s advanced manufacturing sector, and in the process, stabilize the economy. “Our mission is not to do core fundamental research,” explained Berkeley engineering professor David Dornfeld, who is the faculty spokesperson for the partnership, “but instead to transfer research into practice.”

According to a federal report released last year, advanced manufacturing is the most productive industry in the country — for every high-end manufacturing job, sixteen other jobs are created. Over the past decade, however, the nation has lost one-third of its manufacturing workforce, due in large part to its inability to compete globally. As a result, President Barack Obama drafted a proposal last year to invest $1 billion in the AMP.

The AMP hopes to create a more efficient pipeline between academia and industry. Under the current system, a good amount of research gets bogged down in what’s often referred to as “the valley of death” — the nebulous period between design and manufacturing. “We’re going to build a bridge between the research that’s going on in universities and small companies, finding a way to scale that up into production,” said Dornfeld. The partnership also proposes rewriting domestic and international tax policies, which would create a more favorable business climate nationwide.

While the nature of the AMP is to create commercialized products, its structure will ensure that no single investor wields too much power. Along with Berkeley engineers, the partnership will include dozens of small- to mid-size industrial firms, a few major companies, and officials at the National Institute of Science. Local community colleges will also be included in the partnership, and a nonprofit will coordinate all the research. “It won’t be as directly tied to the bottom line of any single company as some of the other [public-private partnerships] might appear to be,” said Dornfeld. “It’s not going to be like, ‘I’m giving you millions of dollars, now I want to have first dibs on the next product you create.’ It’s going to be more of a traditional, consortium-based research group.”

In short, while the AMP continues the shift toward market-driven applied research, its supporters maintain that academic integrity will not be harmed. And by folding a wide range of partners into the AMP, and spurring widespread economic growth, supporters say the research will stay true to UC Berkeley’s public-service mission.

The future, however, looks grim for basic science at Cal. And while no one knows which projects will be axed as a result of federal sequestration, a look at some recent federal research grants provides a glimpse into what types of research could be sacrificed in the future as universities are forced to depend even more on corporate sponsors.

This past January, UC Berkeley Earth & Planetary Science professor Bruce Buffett received a grant from the National Science Foundation to research the deep interior of the earth. While understanding the internal dynamics of our planet won’t produce any immediate economic benefits, it could help people better adapt to global warming. “Rearrangement of continents can alter the circulation in the oceans and even alter the level of greenhouse gases in the atmosphere,” Buffett wrote an email. “A better understanding of climate change in the geological past can provide valuable insights for predicting climate change in the future.” 

In February, the National Institute of Allergy and Infectious Diseases awarded a research grant to UC Berkeley Molecular and Cell Biology professor Greg Barton, allowing him to study how bacterial pathogens develop to evade the human immune system. “Understanding the interplay between pathogens and the immune system is a critical aspect of combating infectious diseases,” said Barton. “It’s quite relevant to public health in general.”

Federal funding will also allow Berkeley scientists to study ancient radiation, solar flares, and brain chemistry this year. This type of research lays the groundwork for future discoveries and can even lead to long-term economic rewards, but due to federal cutbacks, it has become increasingly rare.

Some scientists, though, feel that the shift away from purely basic research and towards applied research is necessary. They argue that applied science will better help humanity overcome such modern-day problems as climate change, overpopulation, and dwindling natural resources.

And many UC Berkeley administrators believe that more private funding is the only possible future for the university. Last August, then-Chancellor Robert Birgeneau addressed the financial conundrum facing the university, telling students that “we’re in the ironic position that to guarantee our public character, we need to increase substantially our private support.”

Departing UC President Mark Yudof regularly argues that, due to shrinking state support, the UC needs to stop viewing itself as a public institution and instead consider itself a “hybrid” university, with many characteristics more in line with private institutions than public ones. “We will have to adjust to this new reality, or, I believe, [we] will cease to be the centers for innovation and significant research,” he wrote in a 2002 issue of Change magazine.

Yet while some UC Berkeley researchers have stayed true to the university’s public-service mission while still accepting large sums of private cash, the commercialization of science has many unintended consequences. “The humanities and most of the social sciences aren’t as effective at generating income, and that means we have a harder job in trying to establish the value of what it is we do on the campus,” noted Berkeley history professor James Vernon.

Such thinking also could justify funding cuts for programs that aren’t “profitable,” thereby reinforcing the belief that higher education in the United States should primarily serve as an engine for economic growth.


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