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cation appears more useful when discussing goals and objectives of the Federal Government. Thus, in our report, when programs of several agencies fall within a single broad function—such as educationthe programs are aggregated under the functional heading. Since the headings designate functional fields for which goals and objectives have been expressed, these aggregations of programs serve to make possible a study of relative priorities. This general approach was endorsed by the President's Commission on Budget Concepts.

The term "function” has been used in many senses and, therefore, I would like to clarify our use of it. For example, the AÉC civilian nuclear reactor program is related to energy production and natural resource utilization and is, therefore, assigned to the functional field of natural resources and environmental. ÑASA's space sciences program is related to the functional field of education and knowledge; NASA's aircraft technology program is related to transportation, and appears within the functional field of commerce, transportation, and communications. The basic research programs of NSF are not considered in this study to be a end in themselves but are identified with the functional field of education and knowledge.

We have used the functional fields listed in the budget with some minor modifications that seemed helpful for our purposes. The budget provides historical data on total outlay expenditures by function, but to our knowledge we are the first to make a similar study on R. & D. expenditures and their comparison with total budget allocations for the various fields. While many Government programs can easily be assigned to one of the 13 functional fields used, honest differences of opinion can exist with respect to others. We were explicit in the way we did it, and anyone who differs can easily regroup the programs utilizing the data we provided.

There are, of course, other ways of discussing Federal R. & D. activities. Some of these have been presented to you in previous studies or testimony-organization by agency, by nature of work-for example basic research, applied research, and development-organization by discipline--for example physics, chemistry, aeronautical engineering, and so forth. Classification of Federal Ř. & D. activities in these other ways frequently serves a useful purpose. However, I believe that much of the current organizational problem and many of the policy issues connected with Federal R. & D. programs are concerned with their relationship to national goals and priorities, and for this purpose the functional end use concept seems more appropriate. Now, I would like to speak briefly from the figures.

(The figures referred to are as follows:)

* President's Commission on Budget Concepts, "Report of the President's Commission on Budget Concepts," U.S. Government Printing Office, Washington, D.C., October 1967. The major recommendations of this Commission were incorporated in the fiscal year 1969 budget used as a basic source of data for the study. The Commission Chairman, David M. Kennedy, is now Secretary of the Treasury, and the Staff Director, Robert P. Mayo, is now Director of the Bureau of the Budget.

FIGURE I

RELATIVE PRIORITIES % OF TOTAL OUTLAVS -FV 1969

44.9% 20.0

4.7

3.3 32

2.9

1 NATIONAL SECURITY
2 WELFARE
3 HEALTH
4 COMMERCE, TRANSPORTATION

AND COMMUNICATIONS
5 EDUCATION AND KNOWLEDGE
6 AGRICULTURE

INTERNATIONAL RELATIONS 8 LABOR AND MANPOWER Q VETERANS 10 SPACE OP HOUSING AND COMMUNITY

DEVELOPMENT 12 NATURAL RESOURCES AND

ENVIRONMENTAL 13 GENERAL GOVERNMENT

2.8 2.3 2.3

2.1

1.6

FIGURE II

RELATIVE R$D PRIORITIES

% OF TOTAL RED-FV 1969

53.1% 23.5 7.3

4,9

I NATIONAL SECURITY
2 SPACE
3 HEALTH
& EDUCATION AND KNOWLEDGE
5 NATURAL RESOURCES AND

ENVIRONMENTAL
COMMERCE, TRANSPORTATION

AND COMMUNICATIONS
7 AGRICULTURE
S WELFARE
9 HOUSING AND COMMUNITY

DEVELOPMENT IO LABOR AND MANPOWER 1. GENERAL GOVERNMENT 12 INTERNATIONAL RELATIONS I VETERANS

14

0,3

0.1 0,1

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FIGURE IV

RELATIONSHIPS BETWEEN R&D AND OUTLAYS:

LOW CORRELATION BUT MOVING CLOSER

FUNCTIONAL FIELDS
LORDER OF DESCENDING 69 OUTLAYS

I WATIONAL SECURITY 2 WELFARE 3 HEALTH 4 COMMERCE, TRANSPORT,& COMMUNICATIONSS 5 EDUCATION & KNOWLEDGE 6 AGRICULTURE 7 INTERNATIONAL RELATIONS 8 LABOR MANPOWER 9 VETERANS 10 SPACE 1 NOUSING & COMMUALITY DEVELOPMENT 12 NATURAL RESOURCES & ENVIRONMENTAL 13 GENERAL GOVERNMENT

RED AS % OF

OUTLAVS 1981 1969 14.6% 11.2%

0.1 0.2 20.3 10.0

2.4 3.8 30.8 19.6 3.6 4.2 0.1 0.2 <0.05 0.9

0.0 0.0 85.7 98.3

0.0 1.2 18.3 22.2 0.1 0.4

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