The report by the National Research Council said research institutions, essential for U.S. prosperity and security, face critical financial challenges that threaten to erode the quality of research and education these universities can provide.
The report, requested by Congress, was written by a committee that included industry CEOs, university presidents, a former U.S. senator and a Nobel laureate.
"The talent, innovative ideas, and new technologies produced by U.S. research universities have led to some of our finest national achievements, from the modern agricultural revolution to the accessibility of the World Wide Web," said Charles O. Holliday Jr., chair of the committee that wrote the report.
"Especially in these tough economic times, the nation cannot afford to defer investment in our best asset for building prosperity and success in the future," Holliday, chairman of the board of Bank of America and former chair and chief executive officer of DuPont, said.
Federal funding for research has flattened or declined, the report said, and state funding for research institutions has dropped by 25 percent to as much as 50 percent in some cases.
The nation's research universities must aid in addressing the problem by meeting "bold goals" to contain costs, enhance productivity, and improve educational pathways to careers both within and beyond academia, the report said.
Exploding whale video goes viral on Internet
Reindeer recovered after escaping from Santa during lighting ceremony