Trump’s proposed controls over federal spending will do more harm than good

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Earlier this year, the White House Office of Management and Budget posted a new proposed rule: regulation for federal financial assistance which, if enacted, would provide oversight on how federal agencies allocate federal dollars for research projects.

Numerous agencies would be affected, including the National Institutes of Health and the National Science Foundation. This has created angst among academic institutions and researchers who receive funds from these agencies, potentially diminishing opportunities for government funding, limiting what the money can be used for and letting it be terminated with little prior notice.

The 108-page PDF document contains more than 100,000 words, around the same number as the Grimms’ Fairy Tales. This means that it is highly unlikely that anyone, including those most affected by the proposed rule, will take the time to read the entire document. As of July 6, one week before the July 13 deadline, more than 80,000 comments had been received. Many expressed concern with the ideological oversight of the federal research funding review process. Others expressed their support for government spending being reeled in.

With nearly $40 trillion in national debt, it is imperative that taxpayer dollars be used responsibly, including funds allocated for research support. I learned this not only when receiving government funding from the National Science Foundation and the Air Force Office of Scientific Research to support my own research program, but also when serving as a program officer earlier in my career, making decisions about how research funds should be dispersed and invested.

Instead of getting into the weeds of the proposed rule, it would be useful to better understand how research funding decisions are made, how funds are allocated, and why the proposed oversight may have unintended consequences, perhaps even doing more harm than good.

Research proposals are evaluated using a peer-review process, which is critical to evaluate the proposed research hypothesis, how it will be tested, and the potential benefits of the results obtained. This is the foundation of the scientific method, a universal approach used to conduct research that yields results that can be reproduced by other researchers and used by them as a foundation to push the boundary of knowledge forward.

Guardrails are put in place during the peer-review process to protect against biases and conflicts of interest. The guiding principle to determine funding is the merit of the proposal as measured using the scientific method.

There are nuances in how research funding decisions can be made. On one extreme, some proposals focus on high-risk, high-reward hypotheses. The peer-review process must make its best assessment of the feasibility of the hypothesis and the methods used to test it. On the other extreme, proposals consider low-risk, low-reward hypotheses. In such cases, the peer-review process must make its best assessment of the benefits of supporting the assessment of the hypothesis, given that it is highly likely to be successful.

A challenge faced by every agency is how to balance the risks and potential rewards of various proposals. Too many high-risk, high-reward grants may yield a portfolio filled with great ideas that never pan out. Too many low-risk, low-reward grants will result in unremarkable outcomes. Venture capitalists face similar choices, with the hope of finding one or two projects that emerge as big winners, often paying for the many projects that lead down dead ends.

A search of the proposed rule yielded the term “DEI” listed 43 times and “gender” listed 41 times. Given President Trump’s executive orders against DEI and gender ideology in government, the proposed rule primarily seeks to eliminate them in federally funded grants. But to use such a blunt tool to effect such changes is akin to “throwing the baby out with the bath water.”

What federal funding supports is untethered curiosity, grassroots efforts among engineers, scientists and physician researchers to pursue a resolution to their questions and uncover insights from their ideas. Given the amount of money involved — around $48 billion in fiscal 2026 for the NIH and $9 billion for the National Science Foundation, totaling less than 20 days of interest payments on the national debt — efforts to place guardrails around grants that closely align with the ideologies of the administration will cost more in new findings not pursued than any direct savings of grants not awarded.

The National Science Foundation provides a comprehensive list of its investments that have improved the lives of Americans. The research it supports has led to the creation of technologies that allowed for the development of cellphones, the internet, and even Lasik eye surgery. All such efforts have also established the U.S. as the world leader for discovery, a key driver for economic growth that lifts the quality of life for all.

I am all for using taxpayer dollars responsibly and efficiently. Every reasonable American can get behind such an objective. However, the process described in the proposed rule is all about cleansing “DEI” and “gender” contributions out of the funding. Allowing government agencies to directly make changes is prudent and appropriate, as the way to do this is from the bottom up, not from the top down. The proposed rule would add far too much risk that could lead to missed opportunities that might otherwise improve people’s lives, often in unexpected ways.

Sheldon H. Jacobson, Ph.D., is a professor of Computer Science at the University of Illinois Urbana-Champaign. He applies his expertise in data-driven risk-based decision-making to evaluate and inform public policy.

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