Tyler Cowen, Columnist

U.S. Could Use a Better Way to Pay for Science

Trump’s proposal to gut payments to research universities goes too far, but the system is open to abuse.

Someone has to pay for all those gloves.

Photographer: Daniel Acker/Getty Images
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We’re all for higher productivity growth, yet such growth depends on a lot of little things rather than a single major lever. One of those things is how we fund science.

There’s been plenty of coverage of proposed cuts to the budget of the National Institutes of Health, but little noticed is a proposal to significantly reduce how federal grants pay overhead to universities through the category of “indirect costs.”1496164617544 These payments to research institutions, both public and private, pay for labs, equipment, data storage and basic support services, among other background functions.