Thursday, March 28, 2013

IMPACTS OF R & D

Long ago (circa 1976) I attended a lecture given by the famous author Ray Bradbury, who wrote such science fiction classics as The Illustrated Man, The Martian Chronicles, and Fahrenheit 451, among many others.  He began by sweeping his hand over one half of the full auditorium and said, “In 1900 you would be dead.”  His talk went on to be upbeat and optimistic about the future, in counterpoint to the general attitude of hopelessness that prevailed in the wake of the Vietnam War and the OPEC oil embargo.  And this was only three or four years after publication of the widely-read Limits to Growth, in which the Club of Rome (a global think tank) predicted a grim future characterized by overpopulation, pollution, depletion of natural resources, and the overall decline of civilization.  Bradbury’s lecture was the only optimistic one I can remember from that time, and I was thunderstruck.  And why was he so upbeat?   Because he believed that scientific progress would help us solve our problems.  He believed in  “technological fixes.”

A couple weeks ago I blogged and bragged about the technological outputs of NASA funding.  However, in the big picture NASA funding represents a very small percentage of monies going to research and development (R&D) in science, engineering, and mathematics.  I suppose one could do a blow-by-blow analysis of each funding agency and industrial sector, looking at the size of investments in R&D and then the outputs of those investments.  I have every faith that such a massive analysis would show huge societal benefits from R&D funding.  Even though this would be great fun, I think there is a simpler way to get at the same data, but from a different perspective—a perspective that also lends itself to examining the “good old days” and their doom and gloom predictions regarding the end of the world as we know it.

And that is to examine the rates of change in various parameters over time.  I have chosen to look at long-term changes in food prices, food availability, energy prices, metal prices, overall deaths, and deaths from specific diseases.

Why these choices?  Simply because they are representative of fields that have changed greatly in the last century in large part due to intensive research and development.  Food production, which impacts both price and availability, has been the subject of huge investments in R&D, everything from mechanization to soil science to plant breeding and genetic engineering.  Developments in mechanization, transportation, exploration, and refining influence the price of energy and metals. Health-related R&D has proceeded at a rapid pace, and one of the goals of that research is to help people live longer lives

And who is providing the money for all this R&D?  Primarily governments, industry, and universities.  It may come as a surprise, but private companies invest more money in research and development than do governments, in all countries of the world.  In 2009 the world invested $1.3 trillion in R&D, of which companies invested more than half.  Prior to WWII, companies invested more money in research and development than universities did.

So first let’s look at food.  In 1919, you would have had to work 9.5 hours at an average salary to buy a bag of groceries containing staples like eggs, bacon, milk, beans, etc.  In 2007 you’d have had to work only 1.7 hours to purchase that same bag of groceries.  The price of eggs, for example, has dropped 85% from 1890 to the present.  Although prices for corn and wheat have recently skyrocketed (due to factors that may be mitigated in the future by policies related to ethanol), the cost per bushel of these grains has been remarkably constant over time.  Yet, yields have showed steady increases, with corn yields in the United States rising from a little more than 100 bushels/acre in 1960 to 160 bushels/acre in 2011.  This is the general pattern for food in general—increased productivity and constant or decreasing prices.  All due to research and development in both the public and private sectors.

Certainly one of the greatest boosts to agricultural productivity was the invention in the 1930s of a method for converting atmospheric nitrogen and hydrogen into fertilizer, a discovery that was made at a German university by Fritz Haber and developed and commercialized by the Bayer company.  (The timing of this invention was very fortuitous, since we were literally running out of fertilizer in the form of guano (bird poop), which had been mined so extensively that worldwide resources were almost totally depleted.)  This one invention probably had a greater impact on worldwide food production than any other single development in the history of mankind.  Another huge increase in crop yields was provided by the invention of hybrid corn by the university researchers and private individuals who started the company that became Pioneer Hi-Bred.  And of course today the research continues with the advent of genetically modified crops.

Now for energy prices.  Take oil.  Oil sold for about $110/barrel in the mid-1860s (adjusted for inflation).  It had dropped to around $20/barrel by the 1880s, and remained essentially at that level until the 1970s (remember the oil embargo).  Prices peaked in 1981 when oil hit about $100/barrel, dropped to about $30/barrel in the mid-1980s, remained flat until the mid-2000s, and has since spiked back up to around $100/barrel.  And coal.  For the past 130 years, U.S. coal prices (again adjusted for inflation) have remained pretty flat at $20-$30/short ton except for a brief period in the 1980’s when they went up to around $70/short ton.

As with food, the reason for these flat prices over 100+ years is due to research and development—primarily improvements in mechanization, materials, and computerization—with resultant efficiencies of production.  Private industry has been responsible for most of these innovations, including revolutionary drilling techniques, such as deep water and horizontal drilling.  The good news is that no matter what form of energy we rely on in the future, whether it is gas, nuclear, solar, wind or biofuels, as in the past, the efficiencies attributable to R&D will certainly keep prices “flat,” since science will present the alternatives and the market will choose the cheapest.

And now let’s look at copper, whose story is similar to that of oil and coal.  The 110 year average price of copper in 2010 dollars is $5/ton.  In 1900 the price was about $9/ton, in 2010 the price was $10/ton, and its all time high was $13/ton in 1917.  From 1920 to 2003, prices were essentially flat.  In the past century, copper production has gone from 0.2 million tons/year to 15 million tons/year. Are we running out of copper?  I doubt it.  Just like oil, as copper becomes more limited in availability and its price goes up, other technologies will take its place and the price will come down.  There is aluminum.  Fiber optics. Recycling.  In the “old days,” ores with less than 5% copper were ignored, but today we are mining ores with only 0.3% copper.  What was once waste is now a mine.  Why?  Because our extraction technologies have improved.  For example, today some companies are using bacteria to extract copper—they help leach the copper out of sulfide minerals, for example.  (The bacteria convert iron into another form, which in turn produces sulfuric acid, and the acid solution causes the release of copper ions.  Then it can be electroprecipitated.) This is called “biomining”; in fact, 10-15% of all copper, and 5% of the gold is mined using bacteria. 

Again, here is the impact of research and development.  When I read that “such and such commodity will be gone in 50 years assuming present day practices,” I want to scream.  Since when has technology remained stagnant?  Of course we won’t we extracting copper in 2050 the way we are now—we may be mining it on Mars!  If the world needs copper in the future, we will get it somehow, and if it is too expensive then we will find something else to use instead.  And then the price of copper will fall, and so on.

And now for the best story of all—health. There is probably no better example of the impact of R&D on the human condition.  From the Paleolithic era until the early 1900s, life expectancy at birth was between 20 and 30 years.  Then something remarkable happened—life expectancy shot up to a worldwide average of 67.2 in 2010.  What happened?  Research and development happened.  On a major scale.

There is no better example of the impact of R&D than the decrease in infectious and parasitic diseases such as tuberculosis, pneumonia, measles, and smallpox, which have been essentially eliminated in many parts of the world as major causes of death.  And this has been accomplished by development of antibiotics and vaccines.

Antibiotics and vaccines.  As common as these are today, it is easy to forget that in 1900 there were no antibiotics and vaccine development was in its infancy.  Even so, by the 1970s smallpox had been eradicated by vaccines worldwide.  The measles vaccine developed by Merck became available in1963, and the disease has been all but eliminated in developed countries.  The polio vaccine was developed in the 1950s, and has also been nearly eliminated in all developed countries.  Today most (I wish it were all, but that is another story) babies and children in the United States are vaccinated against mumps, measles, rubella, diphtheria, whooping cough, and tetanus.

Syphilis, gangrene, and tuberculosis were eliminated or greatly reduced in developed countries by the invention of antibiotics.   The first antibiotic (arsphenamine) was discovered in 1909 by a Japanese researcher in a German university for the treatment of syphilis and subsequently commercialized by the German company Hoechst.  And then we have the incredible sulfa drugs discovered in 1932 by researchers working with dyes in the German company BASF.  Penicillin, derived from the fungus Penicillium, was discovered by several individuals in the late 1800’s in France and England, but never commercialized, in part because the world at the time did not believe microbes caused disease.  It was re-discovered in 1928 by the Scottish scientist Alexander Fleming and other university researchers, who actually isolated the active compound (that is, penicillin), and via a circuitous route, was ultimately developed and commercialized in the 1940s by Merck, Squibb, Pfizer, Abbott, Lederle, and Lilly as well as the United States government.  It saved millions of lives during WWII.  All in all, around 125 antibiotics have been discovered since the 1940s, a staggering 1.8 new antibiotics each year.  It is shocking to recall that tuberculosis and other diseases that are now all but eliminated in developed countries killed one in six adults in France as recently as 1918. 

And so I’m a believer in technological fixes.  That is, I believe there are technological solutions to our problems, both now and in the future.  And this is because I believe in humankind’s ability to solve problems and adapt to changing environments.  Will our environment in the future look like our environment today?  I doubt it.  Any study of geologic history will tell you that’s not going to happen.  After all, the state of Wisconsin was under a mile of ice 20,000 years ago, and before that, it was at the bottom of a warm inland sea.  Global warming (or climate change, your choice), loss of biodiversity, depletion of fresh water sources, food security, cancer, AIDS, ocean acidification, cyber threats, population growth, nuclear winter, emerging diseases, and even a dying sun—yes, Homo sapiens will have its hands full.  These are serious issues.  But dystopia?  That is for novelists and movies (of which I’m a big fan!). In reality, with education, a free press, and our relentless search for the truth, we will be up to the challenge.

And that is just what Ray Bradbury said a long time ago.

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