There’s A Lot Of Money Out There

The latest episodes of the Second Season of the Trump revolve around how much power the executive branch has and how much it should have. The story line —epitomized by the government vendetta against Harvard University (my graduate alma mater) — was then eclipsed by the spectacular, sudden and utterly predictable falling out between Trump and Elon Musk, a marriage never made in heaven and always destined for a bad breakup. As longtime Trump watcher Michael Wolff has been brilliantly charting on his Instagram, the leitmof of the Trump show is attention, and the way to constantly garner attention is to always change and own the narrative. On that score at least, Trump is a hit.

And yet the turmoil of Trumplandia continues to create a vortex that may belie its ultimate substance. Or, to put it another way: the great and powerful Oz is just a man behind the curtain, or in Trump’s case, behind the tweet.

Take the collapse of global health funding and university research funding. USAID supplied more than $40 billion. It now barely exists as an agency. The National Institutes of Health funneled about $40 billion in 2024 in domestic research on disease and care and a myriad of health issues to 300,000 researchers at 2,500 universities. The National Science Foundation channeled almost $10 billion in 2024. The Defense Department spent about another $20 billion on pure research, including AI research. The budget bill now making its way through Congress would cut what was USAID to about $10 billion and the NIH to about $25 billion and maintain the Pentagon spending.

The cuts to USAID were drastic, rapid, and left thousands of programs globally suddenly without funds. The specific assault by the administration on Harvard stripped $3 billion in grants almost overnight, though much of that funding may eventually be restored by the courts. And NIH cuts elsewhere have thrown research labs nationwide into chaos, as researchers and universities scramble to find money they had thought was in the bank.

These moves have totally upended tens of thousands of lives, jobs, and institutes — much as COVID did to the travel and leisure industries in the spring of 2020, and as the financial crisis of 2008–2009 did to the financial services industry. Such harms are real.

But such harms are often overstated in the present, especially by those buffeted by whatever tsunami is hitting them. The sudden withdrawal of money is destructive, but listening only to the voices of those harmed obscures a larger fact: there is a lot of money out there. A lot. Like… a lot.

Take public and global health. In response to the contraction of USAID, the Gates Foundation, led by Bill Gates, announced it would at a minimum double its spending for the next few years, to about $10 billion a year, primarily focused on Africa. That is not enough to fill the gap left by the cuts, but it is only the first announced increase by a major foundation. Global health funding specifically was about half of USAID’s budget, so the extra $5 billion provided by Gates is more substantial than it appears at first glance. And as we have seen as the U.S. walks back from its global defense assistance commitments, there are now dozens of countries in Europe and Asia capable of spending hundreds of millions to billions on foreign aid and assistance — as well as China, which is able to spend tens of billions annually. We are a world awash in capital, and there is a surfeit of sources. The U.S. has been vital, but unlike much of the 20th century, it is no longer essential — if others step up. It's a big if, but it isn’t a pipe dream.

Domestically, the picture is far less dire if you’re not Harvard and not a university in the crosshairs of a politicized funding environment in Washington. The nexus of federal support for university research is a vestige of a Cold War consensus that used the synergy between elite research universities and federal funding to build a technological lead over the Soviet Union. Spurred by Vannevar Bush, who was the Cold War architect of that policy and described its rationale in his 1945 book The Endless Frontier, that fusion was then embraced by the likes of Harvard president James Conant. At the same time, Cold War R&D on science, health, and tech was also funded by private companies and their research arms such as AT&T’s Bell Labs, Xerox PARC, Hewlett Packard’s Applied Electronics Laboratory, and many others. That was augmented by federal research labs such as Lawrence Livermore and Pentagon units such as DARPA (Defense Advanced Research Projects Agency).

The knock on this ecosystem is that only the universities conducted open, deep science research without clear commercial or military applications—yet those efforts often led to the scientific breakthroughs behind things like the Internet and cancer treatments. Government and corporate research, by contrast, was proprietary and protected by layers of secrecy.

Read Easy Money: Even without the Fed, we are awash in cash by Zachary Karabell | June 11, 2014

Today, both the purely government side and the corporate side remain awash in money. Take the R&D budgets for Meta (about $50 billion), Alphabet (another $50 billion), Microsoft ($30 billion), and Apple ($30 billion) in 2024. The combined amount for these four alone is more than $150 billion. Pause on that for a moment: the top four American tech companies spent 2.5x what the primary government agencies doled out. Now add in the research budgets for federal labs like Livermore and Oak Ridge, much of which comes from the Department of Energy—$2.5 billion each. Then add the tens of billions in other government funding, and the hundred billion from other companies ranging from drug companies to industrial giants such as Deere (another $2.5 billion in 2024), and the numbers get large fast.

So, while the Trump Show is disrupting the status quo in ways that are unnecessary and stupid, tarnishing America’s reputation as an open home for the best researchers around the world, the money that is being cut exists in the context of truly immense sums being spent elsewhere — in the federal government and the private sector.

And yes, the cuts to basic research that takes place largely in universities could be a long-term problem, but much of the cutting edge AI, high tech, and biotech research is not being done by or in university labs, even though it does depend on the skilled graduate students who emerge from those universities. It is being done by Meta and Google and xAI and OpenAI and Anthropic and hundreds of med tech and biotech companies.

So before we conclude that what the government is doing isn’t just stupid and destructive in the short term but will permanently imperil the march of science and innovation, let’s look at just how much is being spent in the United States alone, even with these cuts. And that, of course, doesn’t account for how much money China is spending, which may for a while serve only China but which, if history is any guide, will eventually percolate throughout the world and serve humanity whether the Chinese Communist Party likes it or not.

The world may be a troubled place, but it is awash in money, more than at any point ever before, and more money is being spent on technologies and research to solve human dilemmas than ever before. That will matter to the human race over the next decades far more than the Second Season of the Trump Show.