The Association of American Universities makes the same case in more polished language, warning that cuts to NIH, NSF, NASA, and DOE would weaken US leadership just as China is investing heavily in research. 

The budget request is indeed large: it asks for a drop in NIH research funding of about $5 billion, a 23 percent cut to NASA to $18.8 billion, a $1.1 billion cut to DOE's Office of Science, a $1.6 billion cut to NOAA operations, research, and grants, and roughly a 55 percent cut to NSF to about $4 billion. Congress brushed aside many similar science cuts in the prior cycle.

But the competitiveness objection collapses under its own theory. After all, either science is a public good or it isn't. If science is not a public good, then there is no case, even on mainstream grounds, for the state to provide it in the first place. In that case, science is like every other socially valuable activity, such as medicine, software, shipping, farming, publishing—valuable, but optimally provided by the private sector. Rothbard's old point remains decisive: resources are scarce, so more spending on science necessarily means less spending on other goods, and only the price system can discover how much society actually wants devoted to each use. Peter G. Klein sharpens the same point in modern language: government "innovation" policy confuses visible technological spectacle with consumer-valued progress, and ignores what taxpayers would have preferred had their resources remained in private hands.

Of course, the theory of "public goods" is problematic. Hans-Hermann Hoppe notes that all sorts of privately-produced things generate spillovers for non-payers; his examples range from rose gardens to street music to deodorant. Yet nobody concludes from this that such goods must therefore be nationalized. Matthew McCaffrey applies the same insight to science itself: the quality and direction of research depend on the institutions funding it, and once science is severed from market calculation it is steered by bureaucratic priorities rather than demonstrated demand, yielding waste, abstraction for its own sake, and politically-favored lines of inquiry. The mere existence of spillovers does not transform a field into a proper object of taxation.

Now take the statist claim on its own terms. Suppose basic scientific knowledge really is a public good in the textbook sense: broadly non-rival, hard to exclude, and full of spillovers. Then why, exactly, should Americans panic at the thought of China "taking the lead"? If Chinese researchers publish a result in physics, chemistry, or biology, Americans are not made poorer by the mere fact that the paper has a Chinese address on it. Knowledge is not consumed the way a sandwich is consumed. If the product is genuinely public, foreign provision is not a national loss but an international gain. At that point, the "competitiveness" argument quietly changes the subject. It is no longer arguing that science needs state support because markets underproduce it; it is arguing that Washington wants prestige, geopolitical leverage, and command over research pipelines. That is a nationalist power argument, not a public-goods argument.

Rothbard already dismantled this line of panic in the Sputnik era. The launch of Sputnik did not prove the superiority of planned science, and Rothbard argued that government control of science inevitably politicizes it. He also rejected the myth that only giant state-directed research teams can produce major breakthroughs, pointing instead to evidence that many major twentieth-century inventions came from individuals or small groups, and noting that early atomic research was financed largely by private foundations and universities before the wartime state apparatus took over. The Cold War cry was that America must mobilize because the Soviets were "ahead." Today the cry is that America must mobilize because China may be ahead. The slogan has changed less than the flag.