NIH Budget Cuts

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03/18/2017 11:54

Subject: NIH Budget Cuts

quote

Anonymous

Anonymous wrote:
I do not think you understand the business models. You quote facts -- overhead does exist, but it is the cost of running the labs, etc. For example,The overhead on my projects goes to cover things like: my health insurance, retirement, vacation time (that is about 30% of the OH). It goes to cover the office expenses (rent, electricity, HVAC, computers and lab supplies), that is about 15%. It goes to cover the cost of obtaining and administering the programs -- or I am supposed to work for free when doing that? And, it goes to pay the salaries of people up the food chain. It also covers my salary when there are gaps in funding (though often, that overlaps with the cost obtaining new work). It also covers the cost of security -- everyone where I work is cleared, and that means we need spaces to do work.
I do not work for NIH, but rather DoD related. All OH expenses are audited. The rates are set not by the institutions, but by the auditors. In my case, DCAA sets the OH rates.

No, you do not quite understand the models.
First, fringe benefits (fringes) are added to an employee salary. These are the employer half of OASDI (SS and Medicare), insurances to the employee (health/life/disability), unemployment insurance contribution to the state fund,
and employer match and/or contribution to the retirement account and/or pension plan. All these together make about 30% of the salary, usually much less for graduate students who generally get only (cheap) health insurance.
I have no problems with these - those are benefits to employee, with the cost not set by the institution and funds not going to it.

THEN the total (including fringes) is subject to the overhead that I wrote about. Yes, about 15% is office expenses as you say. Most are reasonable, although can trim there too.
For one, nearly all universities are land-grant or otherwise own their buildings free and clear, hence do not pay office rent that you mention. Anyhow, I generously allowed 20%.
The security and clearances do not apply to NIH work. In most National Labs, these are vastly overdone and way out of times. Major DoE Labs do open work and have divisions
full of Chinese, Russian, Indian etc. postdocs and employees. However, all have Security and Safeguards division that process and maintain Foreign National Visitor and Assignment (FNVA)
clearance and paperwork at a large personnel cost. When DoE does work for NIH, those are loaded onto NIH overhead. For what purpose?

Most OH pays "up the food chain" as you say, and the dishes get larger the higher you go. That is what needs to be drastically cut.
Sure, it is audited. The university claims that all those presidents, executive VPs, deans, associate and assistant deans, managers, offices of diversity and inclusion, disability services, IRBs, etc. etc. etc.
are needed to guide, manage, supervise, advise, control, and police research, and the unique business and managerial qualifications of those individuals justify such pay packages.
The auditors accept that as it is the "industry standard" and comparable institutions do the same. Which is true, and exactly what needs to be broken.

And yes, abolish all IRBs. The US science has become best and most admired in the world long before anyone knew what those letters mean.