How Universities Became So Dependent on the Federal Government (2025)

For over eight decades, American universities and the federal government wound themselves into an ever tighter embrace.

The United States wanted to build the most powerful bombs and cure the worst diseases. It wanted to be first to explore the outer edges of the solar system. It wanted to grow more efficient crops. And so, it offered millions, and then billions, to researchers at universities across the country — in Cambridge, Mass., and Berkeley, Calif., but also in Minnesota, Indiana and Mississippi.

The schools took the money. They built the best labs and attracted top-notch professors and students from around the world. They also became increasingly and, at first, somewhat warily beholden to the whims of politicians in Washington.

Now, this mutually beneficial bargain has started to unravel.

President Trump and many Republicans say they will use the threat of deep funding cuts to rein in out-of-control progressive activism on campus, which they believe has driven universities away from their mission to educate and mold better citizens. With confidence in higher education waning among Americans, the president also believes he has public opinion on his side.

But as the Trump administration starts cutting — including an announcement it would pull $2.2 billion in multiyear grants from Harvard University this week — the future of the partnership that built the American research university into the world’s engine of scientific innovation is anything but certain.

The birth of the modern research university

American universities spent $60 billion in federal money on research and development in fiscal year 2023 alone. That’s more than 30 times as much as what they spent in the early 1950s, adjusted for inflation, when the research university system was just beginning to grow into the vast industry it is today.