Debate: National Labs vs. New Science Institutions

Teaching an old dog new tricks vs. getting a new dog.

Editor’s Note: Jordi Cabana’s May 2026 article about the Department of Energy (DOE) National Labs tapped into a discussion that is increasingly common in science policy: can large, unwieldy public institutions be reformed or should we just focus on building new institutions instead? This was an undercurrent of the White House Office of Science and Technology Policy’s recent Science: A New Golden Age report, which erred on the side of new institutions. Indeed, for a certain camp, metascience means new institutions.

Ben Reinhardt and Dan Recht responded to Jordi’s article; they’re less sanguine than he is about the likelihood of National Labs transforming. Jordi was kind enough to respond to their response, which means that we have our first Macroscience debate! Whatever your baseline appreciation for existing institutions or desire for new ones, I hope this debate helps you hone your views and sharpen your arguments.

The views expressed in this piece — by Ben, Dan, and Jordi — are their personal opinions and do not represent the views of any of their employers.

A telescope array built by the Focused Research Organization (FRO) Mothra. Source.

Ben and Dan respond:

Jordi Cabana argues that proponents of focused research organizations (FROs), X-Labs, and other new institutions have missed something big: in our excitement about creating homes for work that is a poor fit for both academia and companies, we’re forgetting that we already have an experienced, well-funded institution whose mandate is exactly that work — the National Labs.

To the contrary, we haven’t forgotten about the National Labs. But instead of asking “what are the National Labs supposed to do?” we should ask “what do the National Labs actually do?” When you ask that question, it becomes clear that the National Labs are poorly suited for the roles we’re creating new institutions for. And, while in theory you could reform them, in practice real reform will only come through competition with other institutions.

The National Labs’ actual activities can be roughly divided into three buckets:

1. Curiosity-driven research that is similar to academic work.

2. Running very large, expensive facilities like the Advanced Photon Source at Argonne, supercomputers, and the National Ignition Facility.

3. National security-relevant research that is too sensitive for any other organization.

(There are, of course, many corner cases that don’t fall into those three categories. Within any billion-dollar budget there will always be outlier activities.)

These functions are valuable, but they’re far from the purpose of an FRO or X-Lab.

Let’s go through Jordi’s points one at a time:

Point: The National Labs’ mission is “both to advance fundamental science and to occupy a missing middle: research that is too complex for a single principal investigator grant, but too risky or oriented on public goods for a startup or a large industrial incumbent to take on.”

Counterpoint: Realism and history argue against this: The National Labs were built to create and maintain the United States’ nuclear arsenal and peaceful uses of nuclear power. Everything else they do has been bolted on over time. Successive statutes added additional mandates like supporting other forms of energy and technology transfer, but the core institutional structures were built for a different era and mission.

Point: The National Labs have a large budget (and presumably that implies they can do a lot of good work).

Counterpoint:

1. Research is a domain with weak correlations between funding amounts and output. Furthermore, there is a lot of evidence that research has been getting less productive over time, so the burden of proof should be on any legacy institution to show that they are deploying money effectively.

2. The vast majority of that large budget is not available for the flexible spending that’s at the core of the new institutions. Beyond the 40% of the budget that goes to weapons maintenance, much of the National Labs’ money is tied up in project-specific funding (which the new institutions are meant to circumvent) and continued funding to large facilities (which are important, but not the point of X-Labs or FROs).

Point: The structure of National Labs allows them to perform many of the functions associated with new institutions for science.

Counterpoint: Jordi asserts this without actually talking about the National Labs’ structure and incentives. First, US law caps National Labs’ spending on self-directed R&D at about 6% of their budgets, so the main way for a National Lab to fund “work of a creative and innovative nature” is to grow ever larger. A subset of Labs achieve this percentage but most do not, with the total spend across all National Labs only reaching about $1B in 2025. For comparison, Alphabet’s “Other Bets” segment, including their X moonshot lab, Waymo, and other long-term R&D efforts, lost $7.5B over the same period.

Second, National Labs serve too many masters. At minimum, each Laboratory Director must answer to (1) an independent management and operations contractor (M&O) that can fire them, (2) the DOE site office that enforces laws and regulations, AND (3) sponsoring offices within the DOE that fund their Lab’s work. This structure results in a range of idiosyncratic behaviors (some due to legislation, some due to perceived legal risk). It’s cute that the Labs tend to serve cake and not beer at parties because alcohol is an unallowable use of government funds.¹ It’s darkly funny that Lawrence Livermore National Lab got in serious trouble for trying to promote itself by blowing things up for a National Geographic documentary about the sinking of the Lusitania because those explosions competed with the private sector. However, it’s a real shame that a National Lab researcher hoping to form a spinout around their own invention (a route that is formally encouraged by the DOE) is required to go through the Lab’s (typically lengthy) technology transfer process, the M&O contractor’s conflict of interest process, and multiple layers of DOE approval to do so. To cut this knot, National Labs have been standing up their own non-profit foundations to facilitate technology transfer and sponsor work (and beer) that the government won’t.

But really, the biggest counterarguments to Jordi’s piece are his caveats at the end:

• Despite asserting earlier that the National Labs are not academia, he admits that their current model “may lead to mimicking the academic approach.”

• The National Labs have structural barriers limiting technology transfer to the private sector, including “intellectual property agreements and security clearances.” They typically see the government itself as their primary customer, especially in their core nuclear mandate.

• The National Labs, like any organization operating at their scale, have significant institutional baggage, which is one of the main reasons to create a new institution.

• He concludes that all of this is baked into the core of the Labs because they are built around maintaining and improving the nuclear arsenal!

The argument that “we already have a perfectly good institution, why do we need a new one?” is an example of a common mistake in metascience (and the world of new organizations more generally): the assumption that because an institution is chartered to perform function X, we should count on that institution to perform function X well and do not need more institutions that are trying to do X.² The maximally ridiculous (but unfortunately common) version of the fallacy is “well, because there is a Department for Good Stuff we shouldn’t start any new organizations to do Good Stuff and we should count on them for all efforts to do Good Stuff.”

It’s clear that the argument is a mistake in business: “Yahoo already does internet search, why do we need Google?” “Nissan already makes the electric Leaf, why do we need Tesla?”³ The mistake is more subtle in government and nonprofits, where overlapping organizational roles can be more confusing and wasteful. However, many organizations do not actually do what it says on the box well, or at all.

Institutional gaps can be filled either by reforming old institutions or creating new ones. Which approach is best depends on the situation and the domain. In the domain of the military, for example, you generally want the former because new institutions are called “private militias” or “a revolution.” In the business world, you generally want the latter because startups can strengthen competition and engage in creative destruction (though old companies certainly do reinvent themselves).

We believe that federally funded research looks more like business than the military. Institutional diversity in research organizations enables many parallel experiments. Overlapping research efforts are actually good. And frankly, 21st century politics does not seem capable of the reforms that would bring the National Labs in line with the idealized vision of them.

Finally, reform and creation are not as diametrically opposed as it might seem. New institutions can serve as laboratories, testing out new approaches that legacy institutions can copy. Legitimate competition from new institutions can drive reform far more effectively than some vague mandate from above.

A technician with the Lawrence Livermore National Lab’s Shiva Laser, the world’s most powerful laser when it was built in 1977. Source.

Jordi counters:

With “Metascience Is Ignoring the National Labs,” I set out to correct the fact that every piece I read advocating for new R&D institutions heavily relied on the university model as a reference point while treating the US National Laboratories, at most, as a note in passing.⁴ I wanted to nudge the authors (and others) into explicitly assessing whether the National Labs already reach or could conceivably reach some of their goals. Thus, I must thank Ben Reinhardt and Dan Recht for taking the time to respond.

Ben, Dan, and I agree that the current moment demands experimenting with new institutional models. We even agree that universities and National Labs do not currently give us everything we need. Where we diverge is that I think the Labs have a lot to offer, both as institutions and as case studies to inform new institutional design. Their response makes two broad arguments: first, implicitly, that we already know what we need to know about National Labs, and second, explicitly, that they are not what we need. This response will focus on the first argument. I will refer readers to my piece to decide on the second point.⁵

Ben and Dan state that my “assumption is that because an institution is chartered to perform function X, we should count on that institution to perform function X well.” Yes, we should count on an institution to do what we pay it to do, and that includes verifying success! In the case of the National Labs, we need to know how to get all our $30B worth. But my conclusion is not to then say we “do not need more institutions that are trying to do X.” Rather, it is that new institutions should learn from why existing institutions are not doing X as well as we want.

Ben and Dan argue it is a “common mistake” to say, “‘we already have a perfectly good institution, why do we need a new one?’” I could not disagree more; I do not think this is a mistake at all. Isn’t asking whether we need a new entrant what any good VC does in the business world? Google not only answered the question, but it succeeded because it answered it so well! Do we remember other human-curated portals like AltaVista, Go.com, or LookSmart? They failed by playing the same game as Yahoo!

Ben and Dan appear to see the challenges of National Labs as practically insurmountable. I am not convinced the prospects are so bleak.

Yes, National Labs can sometimes hew too close to academia. But there are also many parts that indeed occupy the “missing middle” and do not worry about publications. Look at the applied programs for examples. Yes, a large portion of National Lab funding is tied to specific projects. But did you know that, not so long ago, large parts received de facto block funding with local discretion, just like we want for FROs?

The challenges are not set in stone. We need rigorous metascientific analyses to know what can and cannot be readily improved.

Relatedly, Ben and Dan correctly diagnose that National Labs are hamstrung by their federal masters, and they write that “21st century politics does not seem capable of the [necessary] reforms.”

Any FROs that are funded by the taxpayer are going to have the same masters. What is going to stop them from imposing the same seemingly insurmountable shackles? The National Science Foundation’s recently launched X-Labs also won’t be able to use federal money to buy beer.⁶

I will echo Ben and Dan’s final argument. A fantastic reason to experiment with new institutions is that they “act as laboratories for trying new approaches that legacy institutions can copy.” One reason I am excited by NSF’s X-Labs is that, because they are not like typical grants, they will be free from some of the rules and processes that hamper many other programs. We need to analyze how much this flexibility plays a role in the outcomes of X-Labs and how to extend it to existing institutions and other agencies like DOE. We should also flip the script and use what we observe in National Laboratories to direct future experiments.

There is much room to experiment with and learn from the National Labs. How much of each will not be settled with a blog post and a two-part debate. Just as metascience can support new institutions, we need to apply the same level of rigor and vigor to understanding the ones we have.

1. This happens across government-funded research, which is why we need new institutions that aren’t being line audited.

2. These charters can come from external mandates or internally decided missions.

3. Nevertheless people do ask these questions.

4. I won’t claim to have read a representative sample of the corpus of metascience, but if everything that falls on the lap of outsider scientists has this issue, the problem is the same.

5. I will leave my specific disagreement with some of his claims regarding what National Laboratories do for another day.

6. We could decide that it is best for FROs not to be funded by the government to be most effective. Or perhaps the government should create flexibility for existing institutions like the flexibility enjoyed by philanthropically or commercially funded labs.