!!Open Letter to the Members of the European Parliament

The Young Academy of Europe reaches out to the European Parliament in an open letter to express its extreme concern about plans to cut the ERC budget by 221 M€. While the Academy is very much in favor of stimulating the European economy, doing so at the cost of frontier science and innovation is short-sighted. See the open letter below for more information. 
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__Dear Members of Parliament,__
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The European Fund for Strategic Investment (EFSI), an experimental instrument, proposed by
the European Commission aims to boost Europe’s future through financial means. The EFSI involves
an unacceptable €2.7 billion reduction of funds allocated to innovation in H2020, and a cut
of €220 million allocated to the European Research Council (ERC). The members of the Young
Academy of Europe very strongly feel that the EFSI experiment, if it is funded via substantial cuts
of Europe’s flagship research initiatives, shows a dramatic underestimation of the societal cost of
disinvesting from basic research. We therefore urge parliament to stop these excessive cuts and
instead explore and identify alternative funding sources for EFSI that will have lesser costs on
Europe’s future.
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__The Symbiosis of Basic and Applied Research__
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When money is scarce, attention often focuses on applied research that promises economic
payoffs in the short run. However, applied research is dependent on basic research and will quickly
dry out without an intense basic research effort.
Applied research exploits mainstream scientific
understandings to incrementally improve current
technologies. Basic research, on the other
hand, unveils fundamentally new principles,
that can inspire truly disruptive innovations
that create entirely new markets and sustain the
economic pre-eminence of Europe.
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It was European curiosity driven particle physics at CERN that developed the Internet,
which is now at the core of the Digital Economy that the Commission’s program hopes to
boost. The value of basic research goes far beyond the economy. Basic research is the brain
of medical progress.
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It was again basic research, this time on the basis of matter, which gave us the understanding of
nuclear magnetic resonance that, in time, enabled magnetic resonance imaging. This technique has
now revolutionized every hospital, enabling 60 million medical exams a year and saving millions of
lives - in addition to creating entirely new markets with €2 billion per annum in sales for European
companies%%sup [1]/% and substantially reducing treatment costs via early disease detection.
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Finally, basic research is at the forefront of modern culture: it helps us understand who we are.
The basic science discovery of mirror neurons, cells in the brain that respond to our own actions
and those of others, for instance, has permeated all aspects of society by shaping our understanding
of how social we are.
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Cutting the funding for basic research and especially for the ERC in the hope that the same
funds will provide more benefits if pumped into financial instruments instead shows an alarming
lack of appreciation of how the vitality of Europe is grounded in the symbiosis of basic and applied
research. While EFSI might fund some applied research efforts, it is unlikely, by design, to
fund basic research. Diverted €221 million from ERC into EFSI represent less than 0.1% of what
the European Central Bank is injecting annually into financial markets, and will hardly make a difference.
Left in basic research it represents 10% of the ERC annual budget, and has been proven
to have a tremendous impact on Europe’s innovation and future. Even major industry agrees that
cutting basic research is ill advised: in 1996, the CEOs of leading industries pleaded Bill Clinton
not to cut funding in basic research.%%sup [2]/%
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__Why Funds must not be taken from H2020__
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If Europe wishes to boost innovation, EFSI must be funded from sources that do not target
innovation. Otherwise the Commission will sacrifice a validated instrument at the service of Innovation
with a carefully optimized balance of basic and applied research (H2020) for a mechanism
of unknown efficacy that favours applied research (EFSI). The Commission’s only argument for
taking funds from H2020 is that doing so is administratively easy. Is that the kind of argumentation
Europe stands for? Funds should at least be taken in equal proportions from all heading, including
Agriculture, and not be taken excessively from the most innovation-targeting instruments.
If the Commission cannot convince Member States to revise the MFF to reallocate funds from
non-innovation headings to the EFSI what does that say about democratic trust in the EFSI? We
understand the Commission’s wish to have a signature initiative, but crafting the Commission’s
visibility at the expense of H2020 (a mechanisms known to boost innovation) equates to prioritising
political visibility above innovation - am unacceptable disservice to Europe.
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__Why should the European Union fund Basic Research?__
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Applied research and product development are closer-to-market R&D activities that companies
are well suited to do. Patenting laws ensure that innovators can capture most of the economic returns
from such R&D efforts. Basic research is fundamentally different: its long-term benefits to
the economy, health and culture are dramatic, but are enjoyed by society as a whole rather than by
the researchers that undertake it. Accordingly, economic theory tells us, that applied research and
product development can be entrusted to market forces, while basic research has to be publicly
funded to ensure its benefits. Because basic research has global benefits, the capture ratio (i.e. the
proportion of benefits enjoyed for every Euro invested) increases with scale. The European Union,
the largest economy in the world, rather than member states, local governments or companies,
is thus where economic theory and common sense tells us basic research should be funded.
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__The vital importance of long-term stability__
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Pre-eminence in basic research cannot be achieved overnight, but it can be damaged overnight.
The most talented scientists are highly mobile. They will go where their passion – basic science –

encounters the most fertile grounds. After decades of brain drain, the creation of the ERC has
finally laid the foundation to make Europe once more one of the truly best places for ambitious
and curiosity-driven research to take place. This affords Europe the opportunity to attract innovation
and high-tech companies that exploit that innovation with it. It provides Europe with the
opportunity to create the latest trends in basic research rather than follow them. It will create substantial
economic benefits and will provide the citizens of Europe with substantial health and cultural
benefits through the creation of knowledge. In less than a decade, the ERC has funded thousands
of truly ground-braking research. Under current funding, the ERC can only fund about 10%
of the proposals it receives, although all experts agree that the top 20% of the proposals clearly
should be funded to bring science forward. Undermining its role through the proposed raid on its
budget jeopardizes the newly gained European competitiveness the ERC has fought for.
Amidst national turmoil and austerity plans, basic research funding has been dismantled in
many Southern European countries. For many institutions and individual in these countries,
the ERC now remains the only viable source of funding for basic research. Depriving
them from this source of funding will create another lost generation of the brightest minds and
ideas. With ERC teams also comes the unique opportunity for young students to be trained by the
finest scientists we have, providing the highly trained human capital any knowledge society needs.
The ERC has created a beacon of hope, that at least the very best ideas will be funded irrespective
of location. It is critical to make the European Research Area a reality. Cutting its budget now,
after the fierce and balanced negotiations of H2020, and after the ERC is building a world-wide
reputation for Europe would be a devastating blow to the EU that would set back its efforts for
decades. Across the world of both basic and applied science, this would be a grave embarrassment.
Our Plea
Can we afford to smother the innovation capital of Europe? Can we afford not to fund today,
the Internet or the magnetic resonance imaging of the future? Obtaining an ERC grant has become
the criterion for getting a permanent faculty post at the majority of European universities.
Cutting the ERC budget means brain drain. It means that hundreds of the top 10% of European
scientists will have no choice, but to leave the EU or science. Can we afford to loose
our best talent? Please stand by the commitments of the Lisbon treaty: if you want to invest into a
sustainable knowledge economy, invest into fresh ideas. If you want to fund EFSI, do so from
sources the diversion of which will not harm the very innovation EFSI aims to promote.
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Basic or Frontier Research is experimental
and theoretical work done to acquire new
knowledge without any particular application
or use in view. It is the basis for applied research,
which is work to acquire new knowledge
with a specific practical aim or objective
in view. H2020 carefully balances funding for
basic and applied research, and is the result of
thirty years of Framework package optimizations.
In contrast, EFSI is an experiment, and is
unlikely to provide significant funding for basic
research, ignoring this balance.
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[The Young Academy of Europe|http://yacadeuro.org]\\
Prepared by Christian Keysers
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[1|#1] Particularly Siemens and Philips, see [http://www.magnetica.com/page/innovation/todays-mri-market]\\
[2|#2] [http://thomas.loc.gov/cgi-bin/query/z?r104:E01OC6-161:] 
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Download the [document|2 Open Letter from the YAE.pdf]