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Increased competition and diminished federal funding have made it tougher for scientists to rely on the grants that once generously supported labs, research and training of future scientists. The shortage comes at a time when corporate research facilities, such as Bell Labs, have largely disappeared. The stagnant, and in some cases, dwindling money pool has forced many scientists to bid the profession goodbye. Growing numbers are joining the flight overseas to more “research-friendly” countries such as China, South Korea, Singapore, and India.

One-quarter of the 700,000 students who left China between 1978 and 2003 in many cases to study in the United States have returned home. In India, about 60,000 high skilled workers have returned home since 2003.

The brain-drain trend threatens not only America’s dominance as the research and innovation mecca, academicians say. It also jeopardizes U.S. businesses seeking cutting-edge products to sell. Less innovation in universities means fewer startups and less commercialization of products.

“All great things, such as the Internet, Doppler radar, and laser technology, have been built on government investment,” said Matthew Kazmierczak, vice president of research and industry analyses at AeA, a trade group for the high-tech industry.

“Other countries are trying to unseat us as the technology leader and we need to work hard and compete.”

Between 1999 and 2003, research and development performed by U.S. companies abroad jumped 72 percent, according to Josh James, senior research analyst at AeA.

“Main reason is companies are following the talent,” James said. “There’s also the incentives from foreign governments luring these companies.”

Last year, Microsoft chairman Bill Gates addressed a congressional hearing and stressed the need for increased federal funding in basic scientific research at a time when other countries are outpacing U.S. investment.

“The challenges confronting America’s competitiveness and technological leadership are among the greatest we have faced in our lifetime,” Gates said.

In 2005, the most recent data available, the United States invested 2.6 percent of its gross domestic product in research and development, down from 2.8 percent in 2001. Meanwhile, countries such as Japan and China increased their spending in that same period.

“It never has been this bad and people are getting fed up here,” said Rudolf Jaenisch, a biology professor at the Massachusetts Institute of Technology. “The present administration has been the best recruiting tool for other countries.”

While the United States continues to lead the world in total dollars spent on research, the current furor is over the flattening of federal support that began in 2004. From 1998 to 2003, for example, funds for the National Institutes of Health doubled each year.

“Which means if you factor inflation, the buying power of NIH is below what it used to be in 2003,” said Norka Ruiz Bravo, NIH deputy director for extramural research.

While the dollars available remained stagnant, the number of applicants has increased.

“More and more people are out for a slice of the same pie and so it’s much more competitive and researchers are feeling the pain,” Bravo said.

The dip came at a time when countries such as Israel were devoting 4.9 percent of its GDP to research and development, far ahead of the United States’ 0.8 percent contribution in 2004. Last year, China announced a 15-year plan to bolster its universities and boost science, technology, and innovation. The United States, considered the most attractive location in the 1980s, is now the 17th most competitive country for research and development tax incentives, according to AeA.

“Since the early 1990s, the tax credit for R&D faced a series of annual renewals and budgetary problems,” said AeA’s Kazmierczak.

Meanwhile, other countries copied the incentives and offered better deals, he said. China today has a permanent 150 percent tax deduction for R&D expenditures. The tax incentives in the United States expired in December.

The ripple effect of diminished funding is felt across all scientific disciplines.

Already, the United States’ domination in high-energy physics was compromised when projects such as the superconducting super collider were scrapped in the 1990s. A machine similar to the super collider is now being built by the European Organization for Nuclear Research near Geneva.

In the biomedical field, estimates of real funding rates are below 10 percent. This is less than half what it was five years ago, said Junhyong Kim, co-director of the Genomics Institute at the University of Pennsylvania. Funding agencies are concentrating on larger grants for teams and groups, he said.

“But that does come at the cost of individual research projects,” Kim said. “For the more senior scientists, Europe, and more recently, Asia, has more stable funding environments.”