In the blowback to Francis Collins’ comments about budget cuts delaying an Ebola vaccine, there is a lot of confusion going around about just how much the NIH budget declined.
The worst offender is the usually very good Sarah Kliff at Vox.com, who writes:
The NIH’s budget rose rapidly during the early 2000s, growing from $17 billion in 2000 to a peak of $31 billion in 2010. This meant more money for everything…
Funding then began to decline in 2010 and has continued to fall slightly over the past four years (this was during a period when Obama was in the White House, Democrats controlled the Senate, and Republicans controlled the House). By 2013, funding was down to $29.3 billion. These figures do not account for inflation.
Inflation – there’s the rub. Because when you do account for inflation, you see that the NIH budget was in decline long before 2010 – in fact things started to go south after 2004, as the AAAS budget analysis shows:
And depending on how you make the inflation adjustment, things can look even worse – you hear claims of a 20% decline tossed around. To understand how this works, lets look at the numbers themselves:
First, lets go to the NIH Office of Budget and look at the actual, non-adjusted NIH budget numbers.
In 2004 it was $28,036,627.
In 2013, it was $29,315,822. (If I’m reading the footnote in the table correctly (PDF), this includes the effects of sequestration.)
So in nominal terms, the 2013 budget is almost 5% more than in 2004.
Now let’s account for inflation. The NIH gives two price indices for adjusting the budget:
The standard one:
Annual budget formulation guidance from the Office of Management and Budget (OMB) typically makes reference to the Price Index for the Gross Domestic Product (GDP). This measures the annual percentage price increase for all goods and services produced by labor and property located in the United States.
And there’s a research-specific one, which is a bit controversial, based on the cost of goods and services research:
The annual change in the Biomedical Research and Development Price Index (BRDPI) indicates how much the NIH budget must change to maintain purchasing power. The BRDPI was developed and is updated annually by the Bureau of Economic Analysis (BEA), Department of Commerce under an interagency agreement with the NIH.
There are pros and cons for each one, but that doesn’t matter – let’s just look at the effects of both. We’ll convert the 2004 number to 2013 dollars. The index number is (in the 2004 column, pick the 2013 row) 120.0 for the GDP Price Index, and 132.9 for the BRDPI. So in 2013 dollars the 2004 budget was equivalent to:
$33.6 billion if you use the GDP Price Index
$37.2 billion with the BRDPI
Therefore, in terms of real dollars, the 2013 NIH budget is either 13% or 21% below the 2004 budget. Neither number is a “slight” decline. The 2010 budget was $32.9 or $33.2 billion, either 2% or 11% below 2004.