Gil on the Hill: More Budget, More Problems 

Spring is here and so is the debate on the budget. The Fiscal Year 2027 (FY27) President’s Budget Request (PBR) is out and the appropriations process is in full bloom, even if one small but important piece of FY26 lags behind in the form of funding for the Department of Homeland Security (DHS). Meanwhile, states continue to step up and address the most pressing science and technology gaps. 

FY27 Science Funding: “Aww Mom, science cuts for budget again!?” 

As expected, there are more deep cuts for science R&D in the FY27 PBR. 

Trump to NSB: “You’re Fired!” A moment of silence for science governance 

All 22 members of the National Science Board (NSB) have been fired as the National Science Foundation (NSF) and science at-large absorbs the latest blow to its basic operation from this administration. The NSB is mandated by law and appointed by the president. It advises the NSF, Congress, and the president on science. 

Labs of Democracy: States keep pushing on S&T policies 

States have no choice but to deal with the ever-pressing issues associated with the AI explosion and uneven federal support for innovation. We’re continuing to see the “Patchwork-Moratorium” AI policy tension play out at federal and state levels on both data centers and safety. 

Looking to May 

May brings more appropriations process fun as the committees scrutinize the president’s FY27 budget request and compose their own funding bills (which we can expect will again rebuke the massive proposed cuts to science). 

This contentious summer period will reach a boiling point as we arrive closer to the midterms, making meaningful legislating even more complicated. Congress is racing to get laws passed on pressing matters like AI and housing as well as standing business like FY27 funding. 

No one will be surprised if we end up with a continuing resolution to push our shutdown deadline out past the midterms, so the real question is what else will they get done this summer? We know this Administration will be staying busy. 

There are lots we didn’t cover, so we’ll just have to talk again soon! 

Beyond Cap and Trade: What’s Next for Carbon Markets?

It’s a fascinating time to be thinking about carbon markets. In one corner, California just reauthorized its carbon market program, the EU’s Emissions Trading System continues to evolve as the world’s largest compliance market, and a growing number of countries — from Brazil and Indonesia to Singapore and Kenya — are standing up or expanding their own systems, with the architecture for international carbon trading under Article 6 of the Paris Agreement beginning to take shape. In the other, markets are facing headwinds. Pennsylvania just dropped out of a regional carbon market, and while about a quarter of global emissions are now covered by trading systems, steep emissions cuts haven’t followed. 

More broadly, profound legal and political changes in the larger economy and in global climate policy are pushing forward a wide-ranging conversation on next steps in climate policy. In this transitional moment, carbon markets clearly have a role to play in economic and industrial policy, but that role, and the policy environment in which markets function, merits examination.What would it take for carbon markets to actually deliver at the scale and pace the climate problem demands? 

The standard story on the role of pollution markets goes like this: emissions trading worked brilliantly for acid rain in the 1990s, so let’s do it for carbon. Effectively pricing and trading carbon emissions is key to driving a clean-technology transition.

But that story glosses over something important. The acid rain program was operating in specific conditions, with a small universe of highly regulated power plants, shared grids, clear cost information, and a relatively straightforward, easy-to-deploy fix (smokestack scrubbers) for the problematic emissions in question. Carbon emissions trading is orders of magnitude harder – it spans every sector of the economy, involves far more actors, and requires infrastructural changes that don’t come cheap.

That doesn’t mean carbon markets are futile. It means they need to be fit for purpose and embedded in a broader policy strategy. We call this regulatory ingenuity: fitting tools to tasks, rather than hoping one tool does everything.

Three Tools, Three Roles

Climate policy has historically relied on three approaches, each with real strengths and real limits.

These tools work best together. Markets in particular have seen the most success as part of a “portfolio” of programs – including regulation and fiscal policy – where the carbon market functions as a backstop, setting direction and generating funds but not carrying the full weight of an economy-wide transition.

Zooming In On Markets

Positioning markets for continued success requires being clear-eyed about what they can and can’t do. Several structural limits are worth naming.

First, markets optimize for cost per ton, a powerful but incomplete signal. Capital flows to the cheapest reductions first, and that is how markets should work. But cheap reductions are not necessarily the ones critical to fully developed industrial strategies. For example, the marginal cost of generation is not the full cost of reliable, delivered, politically durable clean power. Integration, transmission, siting, and community acceptance all carry real costs that today’s price signals don’t reflect. Until those full system costs are reflected and competitive, markets alone will not scale clean energy at the pace or scale needed. This disjunct between cheap reductions and strategic reductions recurs across the economy. Bridging that gap requires R&D and early deployment to drive costs of needed solutions down to the point where markets take over. 

Second, carbon prices can’t drive decarbonization without affordable alternatives. A carbon price passed along to gas-pump drivers doesn’t transform transportation unless there is something cheaper to switch to. Where affordable alternatives exist, as in markets with cheap electricity and accessible EVs, adoption follows.  Where they don’t, carbon pricing cannot close the gap, and the political backlash against visible consumer costs has been swift.

Finally, market revenues may not cover the real costs of transition. Refinery closures, shifting energy economies, and job losses in fossil-dependent regions have major consequences for workers and communities, as California is now grappling with. Carbon revenues alone won’t fill that gap.

Beyond these structural realities, there’s a second, more fixable problem: carbon markets haven’t yet been built to function like mature markets.

The first problem is an infrastructure problem. Today’s carbon markets lack the infrastructure, breadth, and sophistication of mature financial markets. Registries are fragmented, data fields are inconsistent, chain-of-title is unclear, and there is no unified ledger capable of ensuring finality of settlement. A functional carbon market requires the same institutional foundations that other markets rely upon: transparent interoperable ledgers, consistent data schemas, reliable transfer and custody, and audit trails that regulators and institutions can trust. Only with this plumbing does a market become truly “investable.” Without it, liquidity cannot form and institutional capital remains on the sidelines.

The second problem is a comparability problem. In markets where a “ton” of carbon credit does not represent a consistent underlying asset, credits can vary dramatically in durability, additionality, leakage, and earth-system risk. These differences are economically meaningful because they characterize the credit, duration, and performance risks of this asset class, and current markets do not sufficiently account for them.

Financial markets long ago learned how to handle heterogeneous assets. Commodities are graded, mortgages are underwritten, bonds are rated, structured products are tranched in a standardized form that, when paired with transparency, enables informed decision-making. Carbon markets similarly need a standardized, quantitatively grounded way to express expected atmospheric impact. Infrastructure and comparability are mutually dependent. Without infrastructure, standardized units can’t be recorded, verified, or enforced. Without comparability, infrastructure has nothing meaningful to track.

These problems are solvable; indeed, efforts are underway to solve both the infrastructure and comparability gaps. But even a technically mature carbon market will still bump against the structural limits above. The market needs to be embedded in a broader strategy.

What Well-Designed Markets Can Do 

There is broad agreement that big industrial emitters — power plants, large manufacturers, heavy industry — are natural candidates for direct market participation, and especially so in the context of well-developed economic strategies that can attend to a range of transition equities. In compliance markets, where regulation creates scarcity, well-designed trading systems can accelerate their decarbonization while generating substantial revenues that can be directed toward harder-to-reach parts of the economy.

The harder question is what role markets should play beyond these large point sources — particularly in voluntary and offset markets, where demand is discretionary, the underlying units are heterogeneous, and market infrastructure is less mature.

One view is that most other sectors are poor fits for direct market participation and that the primary value of carbon markets lies in generating revenues and behavioral shifts from the parts of the economy that respond well to price signals, and directing those resources toward the parts that don’t. Natural and working lands, for instance, urgently need funding to manage climate risk —wildfires are erasing climate gains in California, and carbon sinks are deteriorating under pressure from fire, drought, and deforestation. Diffuse emitters — small freight operators, aging refrigeration systems, millions of buildings that need electrification — lack the capital or capacity to participate in complex trading systems. In this framing, carbon markets function less as direct decarbonization tools and more as engines of transition finance: pricing what can be priced, and channeling the proceeds toward what cannot. 

Adherents to this view would also emphasize that there are broad categories of public transition cost, like addressing major regional shifts in public budgets and private incomes as entire industries transition, that at minimum require additional funds and policy to manage. California’s closing refineries (and the attendant political debate over the fundamental structure of its fuels system and the fiscal stability of affected counties) are an example of revenue and policy challenges that a market alone cannot close.

A different view holds that the problem isn’t that many sectors are inherently unsuited to markets, or that markets can’t contribute to larger public finance challenges, but that the markets themselves are unfinished. Today’s markets lack sufficient demand signals that arise when governments impose some form of compliance obligation, whether through a tax, procurement standards, or other policy mechanisms. Carbon credits from forestry projects, land management, methane abatement, and engineered removal all represent real atmospheric interventions — but the current market has no rigorous way to compare what they actually deliver. Without standardized infrastructure and a common unit of impact, a forestry credit and an engineered removal trade as if they are equivalent when they are not, or one is excluded entirely when it could be valued proportionally.

In this framing, the fix is not to route around the market but to build the market properly — with the comparability tools and settlement infrastructure that would let heterogeneous credits be priced accurately and traded with confidence. A market built this way could reach diffuse actors through intermediation, aggregation, and structured products, much as mortgage markets reach individual homeowners without requiring each one to trade directly. A framework for carbon markets, which proposes standardized assessment of atmospheric impact per dollar, offers a concrete path toward this kind of market maturation. It could also more efficiently channel funds to public needs by helping direct scarce capital to whatever delivers the most verified atmospheric benefit per dollar.

Though we (the authors) differ about which view we believe to be most true, we also realize that these two views are not necessarily in conflict. Revenue transfer and market maturation can work in parallel. A strategy oriented around revenue transfer focuses on regulation, fiscal policy, and public investment to do the heavy lifting, with markets in a supporting role. A strategy oriented around market maturation invests in the infrastructure and standards that would allow markets to bear more of the weight directly. The right path almost certainly involves both, and getting the sequencing and emphasis right could be one of the most consequential design choices in climate policy today.

Where Do We Go From Here?

The above analysis lets us take a more sophisticated look back at the acid rain program. The lesson this program teaches isn’t “markets work, full stop.” It’s that markets can accelerate a transition whose economics are favorable, such as the transition to widespread use of smokestack scrubbers: straightforward, cost-effective technology. But markets cannot create that favorability, nor are they always designed to anticipate and manage second-order effects.

A second lesson is that well-designed tools, matched to the right problem and the right timescale, can deliver real results. That applies to carbon markets themselves — which today have design flaws that can be corrected — and to the broader policy architecture in which they sit. A powerful path emerges when well-designed markets are embedded in a broader strategy: enforceable regulatory limits that create real scarcity and price signals; industrial policy that is not only well-designed but well-executed; and a clear theory of how the costs and benefits of transition are distributed.

But it also applies within the market. If carbon markets are going to play a meaningful role — whether as engines of transition finance, as instruments of accurate pricing across heterogeneous climate interventions, or both — they need the infrastructure and standards that any serious market requires. That work is underway, and it deserves at least as much attention as the policy debates that surround it.

So what’s going on with carbon markets? We’ve asked one incomplete tool to do the work of three. And we’ve debated what role markets should play without finishing the market itself. It’s time to do both: modernize market structure, and stop asking markets to work alone.

Sacred Cows: What Did We Stop Questioning in Digital Government Delivery, but Should Now?

Over the past month, we’ve been running digital service retrospectives with more than 100 people from across the United States to help us design more effective services that lead to better outcomes for people across the country. You can read more about our project here. 

We know that the biggest, boldest ideas can come from anywhere and we have deliberately taken a community-driven approach to our retrospective work. Our sessions are open to anyone who’s worked in government digital services — alums and current staff of USDS, 18F, TTS, and state and local teams who have spent years inside government trying to make things work — and we’ve given everyone a chance to contribute. The result is a lot to unpack: a huge amount of insight, frustration, pride, and hard-won experiences people shared with us. What struck us most was the tension: sometimes uncomfortable disagreement among people who had dedicated years to the same mission. That tension, it turns out, is exactly what this exercise is designed to surface.

When I landed at the US Digital Service, I immediately was inundated with stories, myths, mysteries, hero/villain narratives, and beliefs about what USDS does, how it does it, and why it works that way. Sometimes, the opinions were so strong that they came off like fact. And when I joined another agency, “the way things work” was approached as a set of truths written into legislation, rather than a series of decisions that accrued over time. Organizations built on destiny can be nearly impossible to improve — you can’t iterate on a legend, and you can’t refactor a belief.

Don’t get me wrong, much of the government — and likely most mission-driven organizations — behave like this. And even for those of us who were lucky enough to start new teams or even agencies in our lifetimes have played a part in institutional myth-making as well. 

But where it gets limiting is when beliefs become fact, habits become silos, storytelling becomes rules, and we lose our ability to be a learning organization — and with it, the ability to evolve, challenge, and push forward.

So, we decided now was a good time to challenge the system of beliefs that make up government digital capacity, as well as policies and approaches that felt un-challengeable. Let’s see what rules we can rewrite and beliefs we can reset: a few sacred cows are long overdue to be put out to pasture

What we’re calling ‘sacred cows’

A sacred cow is a long-standing belief, structure, or practice that people hesitate to question — even when it may no longer be serving the mission. Surfacing these isn’t about blame. Most of these beliefs made sense at some point. Some of them were correct at the time.

The problem isn’t that these beliefs existed – it’s that they likely have become perceived facts and traveled. New people joined USDS or 18F or a state digital team and absorbed the orthodoxy without questioning it. It got baked into how teams were structured, how trust was defined, what counted as success. A field that was supposed to be about iteration stopped iterating on itself. 

And now, we want to create permission to examine them with fresh eyes, so we can design something better.

We asked every group in our retros a version of the same question: What is something in digital service that feels unquestionable — but might benefit from fresh examination?

Here are some of our favorites: 

“Delivery and Tech are a specialty team’s job”

We have spent fifteen years sending in outside digital teams to fix what agency leadership (including many IT leadership) didn’t understand well enough to build right in the first place. At some point the question becomes: what if we just built the competency in the system instead of relying on a “save the day” model? In 2026, all organizations are software organizations. Every Senior Executive Service-level leader making decisions about policy, procurement, service delivery, enforcement, and hiring is making technology decisions. These fields must become agile, responsive to users, multidisciplinary, and strategic—and conscious of the digital environment they operate in and create. 

A common pattern is deferring delivery and technology matters to specialists and we look forward to seeing how this space changes and matures. We know we are not alone wanting to see civil service and personnel reforms and are excited to learn about future reforms recommended by colleagues like The Tech Talent Project and TechViaduct. We should expect more ambition and better delivery consciousness from our agency leaders in all roles. An operating model that relies on external fixes rather than internal competence will always be behind. 

“Policy designed without users or implementation in mind can still be good policy” 

This myth came up in every session, multiple times.  No one wants to accept this shortcutting anymore.

Policy development and implementation should never be far from the citizens it would impact — its end-users — and the implementers who deliver those results. And yet too often, policy gets designed by academics, economists, and MPAs in isolation from the people who will have to build the system that makes it possible and the people who will have to live with its gaps or failures. Implementation and impact become an afterthought. 

In many cases, this wasn’t accidental. The way digital services were scoped and deployed reinforced the myth — technologists arrived after the policy was written, the budget was allocated, and the flexibility was gone. By the time they were in the room, the important decisions had already been made without them. 

One example of where tech and policy worked well together was Direct File — from the earliest days, USDS played an integral role in the policy development phase, including building early prototypes and user journeys throughout the formal policy process. Not only did the Direct File team carry that work forward into the product itself, but the multidisciplinary, cross agency relationships built during those early days supported the product through to its launch. 

Today, the technology that the government connects to Americans, the data that tracks results, and the design that saves time and stress are not optional components of policy – they’re how policy actually reaches people. Policy that skips this loop doesn’t just launch slowly — it launches wrong. Moving forward, 100% of policy needs to be designed with technologists, designers, and data scientists at the table, as the necessary translators to end users. 

“We can’t affect urgent change without damaging trust” 

Building trust between digital teams and agency partners came up in almost every session and almost everyone agreed it mattered. Where it got interesting was the question of who we build it with, why, and can it hold us back or slow us down when time is short? 

It was widely acknowledged that building trust is critical to the success of launching scaled, utilized, and beloved digital services. We also we had some really interesting discussions/debates around building trust inside of agencies. Trust was important — but alignment broke down on whether trust with agency partners is a core foundation, necessary as a form of permission, or a relationship built in practice through successful partnership. Trust can be invoked to justify waiting — or to avoid taking a position altogether. But it can also be the reason work doesn’t survive once the team leaves. 

Trust gained through the work is different from trust gained in order to do the work. Moving forward, we need to acknowledge this and ensure that the relationships we build will still carry forward through – and beyond – delivery.

Compliance is a proxy for quality control 

The Paperwork Reduction Act (a law meant to streamline how much data the government collects from the public) gets invoked constantly to stop user research before it starts. And the Authority to Operate process (the federal security review required before launching a system) is often a costly, never ending paperwork exercise that more often than not confuses compliance with security. Both exist for legitimate purposes, and both can be executed in ways that actually serve those purposes. 

But when they’re invoked as the default answer to slow or stop work, the cost is real: user research doesn’t happen, services launch without being tested against the people who need them, and security theater replaces actual security. 

Attempting to minimize burden on people and launching secure services are both good practices and, moving forward, we should look for transparent oversight that achieves this, while also ensuring the pace of delivery is not held back.  We’re keen to see future recommendations from partners in the state capacity ecosystem on PRA reform and TechViaduct on oversight recommendations. When compliance becomes the goal instead of the means, the people the law was designed to protect are the ones who pay for it.

We can’t have good tools

I kind of hate myself for even writing this because it is so obvious and frustrating. But, here I am, repeating what everyone said during our sessions because we are still saying it. 

Digital government professionals can use modern software to build, design, and launch great experiences… but with endless friction that makes it not worth asking. This plays out constantly: teams lack of access to modern resources and tools that allow them to work, like design software, coding environments, or even mission support tools, like Slack. The result is teams spending time on workarounds instead of the work, and talented people leaving for environments where the tools aren’t a fight to obtain.

Somehow, “we don’t have access to the tools we need” became an accepted condition of the work. It is time to reassess that. Procurement and approval processes should happen centrally to ensure that they are safe, secure, and ready to deploy in all agencies without significant delay.

The perfect team size exists!

Teams should be big! 

Teams should be small! 

This was another topic that came up in every session and there is no consensus on the right answer. The lack of consensus is actually the point — team size isn’t a principle, it’s a variable. Team size should be based on the problem you’re trying to solve or the outcome you want to achieve. Agency digital transformation cannot be realized with a USDS team of 2-4 people; that’s a gesture. Direct File had a product team of 75 (blended in house and vendor, but majority government employees) — that wasn’t bloat, it was what the problem required. But myths about team size calcify fast. Once ‘small and agile’ or ‘go big’ becomes part of an organization’s legend, rightsizing stops being a decision and starts being a heresy

Instead of assuming there’s a right size, identify the problem and build the appropriate team to solve it. Too often, building the team became the goal rather than the means — optimizing for org chart over outcomes. The team is not the product, the service is.

Try this at home

The Sacred Cows exercise is an effective tool for debate and to challenge our own assumptions as digital government professionals. This list could have been a lot longer, and if we want to rewrite the rules for better government, the more experiences we hear the better.

Do these resonate? What have we missed? Here were our prompts, but feel free to expand: 

What is something in digital service that feels unquestionable — but might benefit from fresh examination?

Allies or Adversaries? Science Diplomacy’s Calibration in the President’s Budget Request

The White House released its Fiscal Year 2027 budget request last week, with sweeping implications for science, technology, and innovation policy. Nestled in the cuts and investments of interest to the S&T community is a more complex story of how the administration is approaching the practice of science diplomacy–leveraging science as a bridge between countries in order to build trust, open dialogue, advance shared interests, and participate in discoveries that benefit the American people. 

Headlining the budget request are deep reductions in funding for programs and initiatives traditionally responsible for providing science diplomacy capacity. While those programs languish, and the administration is requesting investments in new and existing initiatives, a coherent reoriented strategy emerges: one that shifts away from traditional, cooperation-based, institution-building models of science and technology engagement and instead embraces a more transactional posture that prioritizes U.S. strategic competition and national security. 

The Cuts

First, the administration has requested significant program cuts and eliminations across agencies, with implications for science diplomacy capacity and priorities.

Department of Commerce

NOAA operations, research, and grants are cut by $1.6 billion, affecting international research partnerships such as Argo, which powers global weather forecasting through a global network of thousands of profiling floats; the Global Ocean Monitoring and Observing Program (GOMO), which provides one million ocean observations per day to “understand our changing ocean and its impact on the environment”; and the Partnership for Sustainably Managed Fisheries, which supports efforts to prevent illegal, unreported, and unregulated (IUU) fishing. In addition, National Institute of Standards and Technology (NIST) funding is cut by $993 million, with implications for the ability of NIST to credibly function as a world-class international standards organization. Finally, there is a $150 million reduction for the International Trade Administration (ITA), reducing America’s scientific and trade presence in what the administration has characterized as “low-value markets,” and potentially leaving a vacuum for a U.S. adversary to fill instead.

Department of Energy

Cuts to the Office of Science by $1.1 billion, affecting research programs that have historically anchored international scientific collaboration, such as the international fusion flagship the International Thermonuclear Experimental Reactor (ITER). Cuts to ITER imperil the domestic fusion research enterprise, as ITER is currently the only long-pulse fusion experiment with U.S. investment where some of the most difficult basic research challenges will also take place. In addition, the administration also calls for a prohibition on the use of federal funds for subscriptions to academic journals and for publishing costs, which can mean that federal researchers lose access to international journal databases, federal researchers may be less able to publish in high-visibility international venues, and foreign researchers will see fewer U.S. voices in shared academic spaces.

Department of Health and Human Services

The budget request proposes a $5 billion reduction in funding to the National Institutes of Health (NIH), and specifically, the elimination of the Fogarty International Center, which advances NIH’s mission by “supporting and facilitating global health research conducted by U.S. and international investigators, building partnerships between health research institutions in the U.S. and abroad, and training the next generation of scientists to address global health needs.” Fogarty has a history of training biomedical researchers around the globe to defend against emergent health threats, including Dr. Sikhulile Moyo, who sequenced and identified the first major vaccine-resistant strain of COVID-19 in Botswana; and Dr. Christian Happi, who led efforts diagnosing and confirming Ebola in Nigeria which ended up saving millions of lives. 

Department of State and International Programs

The President’s request calls for a reduction of $4.3 billion for global health programs, with a restructuring of the President’s Emergency Plan for AIDS Relief (PEPFAR) towards more bilateral health assistance under the America First Global Health Strategy (AFGHS). In addition, it calls for a $2.7 billion reduction in funding for international organizations like the United Nations. President Trump has not shied away from critique of the UN in the past, remarking that “not only is the UN not solving the problems it should, too often, it is actually creating new problems for us to solve.” Instead, the administration proposes supporting peacekeeping missions through more flexible funding in the America First Opportunity Fund (referenced later in this analysis under investments). The budget request also calls for a reduction of $642.4 million for Treasury’s international programs, with total cuts to multilateral financial institutions such as the African Development Bank and Global Environment Facility.

National Aeronautics and Space Administration

The administration proposes $3.4 billion in cuts to NASA’s science program, with implications for the SERVIR program, a joint venture with USAID which “provides satellite-based Earth observation data and science applications to help developing nations in Central America, East Africa, and the Himalayas improve their environmental decision making.” In addition, it calls for $1.1 billion in cuts to the International Space Station (ISS), considered a premier example of international science diplomacy and collaboration. The Administration has also canceled U.S. involvement in NASA flagship programs, like the Lunar Gateway, which are only possible through cooperation with dozens of countries. When the United States unilaterally withdraws from projects without consulting our partners, it can damage the reputation of the United States due to the hundreds of millions of dollars in unrecoverable effort spent by those countries. This undermines the credibility and reliability of the United States, making similar undertakings dramatically more difficult in the future.

National Science Foundation

The National Science Foundation (NSF) is requesting a dramatic cut to funding for its Office of International Science and Engineering (OISE), requesting just $2.74 million, down from $48 million in FY25. While NSF characterizes its overall budget request, down significantly from previous years, as a reflection of a “strategic alignment of resources in a constrained fiscal environment,” OISE programs like Accelnet and MultiPlex provide funding for U.S. institutions to participate in international networks, giving American researchers access to specialty knowledge, platforms, and talent that is necessary to advance American discovery and innovation. This includes funding to ensure American leadership in international organizations like the International Science Council and ensuring access to extreme laser platforms currently only located in Hungary, Czechia, and Romania. At the requested level, OISE would be unable to support grant programs and maintain minimal staff.

The New Investments

At the same time, the budget also proposes significant new investments, whose shape is equally telling to the administration’s approach to science diplomacy.

Department of Commerce

The administration touts an unprecedented $215 million budget increase request for the Bureau of Industry and Security to protect American innovation and national security from the threat of “malign actors.” The DNI’s Foreign Malign Influence Center defines malign influence agents as potentially being “foreign government officials, intelligence services, cyber actors, criminal groups, state-run media organizations, social media actors, and businesses with close ties to government officials.” Despite targeting malign actors in theory, in practice, this orientation has historically also implicated legitimate scientific exchange. While export controls may limit foreign competitiveness in the short term, once foreign governments adapt, they can also undermine the competitiveness of American companies.

Department of Energy

A $394 million investment to drive American dominance in critical minerals production, and the insulation of critical mineral production and processing supply chains from potential threats posed by adversaries. Notably, critical minerals are essential inputs for clean energy technologies, such as electric vehicles and battery storage, that the budget simultaneously eliminates funding for, even as it expands support for coal and fossil fuel production.

Department of State and other international programs

$5 billion in funding for the America First Opportunity Fund, which would replace several accounts–including Development Assistance (DA), Democracy Fund (DF), Economic Support Fund (ESF), and Assistance for Europe, Eurasia, and Central Asia (AEECA)–with a more flexible pool of money oriented towards bilateral partnerships and initiatives that, according to Secretary of State Marco Rubio, will advance “US diplomatic, security, and economic goals.” In addition, the budget requests $13 billion in funding for critical mineral supply chains, complementing similar investments at the Department of Energy.

This is not simply a story of cuts; rather, it is a story of whole-of-government reorientation towards science diplomacy that has consequences not just for American innovation and competitiveness, but critical interests that we share on a global scale. How Congress responds to the President’s budget request with its own appropriations legislation, and how the broader S&T community engages with that process, will determine whether this shift represents a temporary recalibration or a more durable transformation of how the United States shows up as a partner on the world stage, and, equally important, how it is seen by its allies and adversaries.

DOE’s FY27 Budget Request: the Good, the Bad, and the Ugly

Surprise! It’s a double album drop with the release of both the President’s Budget Request (PBR to us, not Pabst Blue Ribbon) and the Department of Energy’s (DOE) Budget Justification for Fiscal Year 2027 (FY27) last Friday. As policy wonks, we here at FAS are here to give you the rundown on all the details for DOE’s energy and nuclear weapons program budgets. 

Jump to…

Big Picture 

Overall, DOE is requesting a 10% increase to its FY27 budget compared to 2026, bringing its total annual budget to $53.9 billion. However, this additional money would go almost entirely to the National Nuclear Security Administration (NNSA), giving them a 12% bump from 2026 levels to reach $32.8 billion. The remaining $21.1 billion left for non-NNSA DOE programs represents an 11% reduction of DOE discretionary funding from 2026 enacted levels. 

It’s important to note, however, that this budget request is just that, a budget request. Congress will likely have its own ideas about how DOE should be funded for FY27, and that too will evolve as staffers take into account appropriations requests from stakeholders and appropriators engage in negotiations and reconciliation over the coming months.

This year’s budget request introduces a number of new accounts, intended to reflect DOE’s reorganization last November. New accounts have been created for the Office of Critical Minerals and Energy Innovations (CMEI) and Hydrocarbons and Geothermal Energy Office (HGEO), with former accounts for Energy Efficiency and Renewable Energy (EERE), Fossil Energy (FE), and others reorganized under them. 

Additionally, two large accounts have been created for Baseload Power and Artificial Intelligence & Quantum. The administration has proposed to fund these accounts at the level of $3.5 billion and $1.2 billion, respectively, by repurposing IIJA funding for the Hydrogen Hubs (likely also requiring the use of funds from cancelled awards). The Baseload Power funding will support activities across HGEO, the Office of Electricity (OE), CMEI, the Office of Nuclear Energy (NE), and the Office of Cybersecurity, Energy Security, and Emergency Response (CESER); the Office of Artificial Intelligence and Quantum’s (AIQ) funding will support seven new supercomputers at the national labs. 

Appropriators in Congress have expressed fatigue with DOE’s reorganizations, so it remains to be seen whether Congress will adopt these changes or keep the old account structure and leave it to DOE to reapportion money internally.

The PBR also indicates a move to rehire staff for DOE, after the agency lost 3,050 federal employees last year. Estimated numbers in the FY27 request reveal plans for a 3.5% increase in the number of staff supported by the accounts for DOE’s energy programs1 and a 7% increase in the number of staff supported by NNSA’s accounts. The FY26 estimate only indicates the number of positions available, though, not the number of current employees, so the actual rehiring effort is likely much larger than the PBR numbers suggest. Rehiring is also likely to be a slow and difficult process, since the most qualified former employees are unlikely to return. Some recent DOE job postings have remained open for months without a hire.

Below, we present a rapid-fire summary of the budget numbers and highlights you need to know. And then keep scrolling for deep dives on the requests for NNSA, CMEI, grid programs, and HGEO.

The Good: New funding for the grid, clean firm energy, and critical minerals supply chains

The Bad: Cancellations and budget cuts across DOE energy programs that Congress will likely temper

The Ugly: Significant increases to funding for nuclear weapons and fossil fuels 

Spotlight: Nuclear Weapons/NNSA 

The NNSA’s budget is broadly divided into four buckets: Weapons Activities (exactly what it sounds like), Defense Nuclear Nonproliferation (which focuses on nonproliferation, counterproliferation, and nuclear-related counterterrorism), Naval Reactors, and Federal Salaries and Expenses. It is very easy to see which of these categories this administration is prioritizing.

The NNSA’s proposed $32.8 billion topline budget is a 29% increase from the FY26 enacted amount, but approximately 84% of that total is slated for Weapons Activities, which surged 35% from $20.4 billion enacted in FY26 to $27.4 billion in FY27. This is in addition to another $3.9 billion provided by the One Big Beautiful Bill Act (OBBBA), most of which will be obligated in FY26.

The categories under weapons activities include warhead production modernization, infrastructure and operations, and stockpile research, among other things. Highlights from the FY27 budget request reflect the surging costs that come with modernizing all three components of the nuclear triad at the same time: 

Interestingly, the Stockpile Sustainment program office has been renamed Stockpile Operations (under the Stockpile Management program), likely reflecting a shifting focus from its maintenance function toward prioritizing production and modernization for new warheads.

Spotlight: CMEI

CMEI is a mega-office within DOE that reports directly to the Secretary of Energy. Its programs and sub-offices are organized under three pillars: the Office of Critical Minerals, Materials, and Manufacturing (CM3), the Office of Energy Technology (E-Tech), and the Office of Innovation, Affordability, and Consumer Choice (IACC).  

The FY27 request would cut CMEI’s budget by 63% from $3.0 billion down to $1.1 billion. A closer look at the budget for each pillar reveals even deeper cuts: E-Tech faces an 88% reduction, while IACC faces a 93% reduction, both achieved through eliminating or nearly eliminating programs formerly under EERE, State and Community Energy Programs, and the Federal Energy Management Program. Notably, the administration is once again proposing to eliminate funding for the Weatherization Assistance Program (WAP), which helps reduce energy costs for low-income households. Ending WAP now, while the U.S. faces a new energy crisis induced by the war in Iran, runs counter to the administration’s stated energy affordability priorities. These cuts would also gut much of DOE’s work on renewable energy, low-carbon transportation technologies, and building and industrial electrification efforts, though the Baseload Power account does offer an additional $500 million in funding for E-Tech to uprate hydropower plants. 

CM3 is the only pillar with a budget increase of 85%, but even that is concentrated within a single office: the Advanced Mining and Mineral Production Technologies Office is slated to receive a 339% budget increase. Meanwhile, other offices under CM3, such as the Manufacturing Deployment Office and the Advanced Materials and Manufacturing Technologies Offices which run both critical minerals and manufacturing programs, are facing cuts of 18% and 19%, respectively.

Spotlight: Grid Funding for OE, CESER, and Baseload Power

Across the board, grid focused offices – the Office of Electricity (OE), the Grid Deployment Office (GDO), and the Office of Cybersecurity, Energy Security, and Emergency Response (CESER) – lost significant levels of funding in the FY27 budget request. OE and CESER would see their budgets shrink by $56 million (22%) and $30 million (16%), respectively, compared to FY26 enacted levels: significant indeed at a moment when electricity demand is surging, extreme weather is straining grid infrastructure with increasing frequency, and the U.S. grid is already widely acknowledged to be aging and vulnerable. Underfunding these offices carries real risk for the administration’s own energy dominance goals, let alone broader reliability, resilience, and affordability of the U.S. energy system.

OE leads R&D activities and programs that strengthen and modernize our nation’s power grid to maintain a reliable, affordable, and secure electricity delivery infrastructure. According to DOE, OE will focus on “electrical energy dominance by combating the capacity crisis, navigating growing complexity, strengthening supply chains, and securing grid infrastructure” in FY27. 

Through the reorganization, OE acquired GDO’s staff and programs, so their funding has been moved into the Electricity account for FY27. These programs face the largest cuts: Distribution & Markets and Hydropower Incentives (which were moved to CMEI) would see their budgets zeroed out, while Transmission Planning & Permitting faces a 61% decrease. Cuts were also made to the budgets for Energy Storage (-39%), Applied Grid Transformation Solutions (-24%), and Resilient Distribution Systems (-18%). 

On the other hand, OE potentially stands to gain $750,000,000 in repurposed IIJA funding through the Baseload Power account for the purpose of reconductoring existing transmission lines with advanced conductors to unlock approximately 3-6 GW of incremental transfer capacity on constrained corridors. This is an important activity as reconductoring can double the capacity on existing transmission lines and is more cost effective than building new transmission lines, allowing more generators and customers to connect to the grid. However, this gain does not offset the loss of funding for ongoing activities designed to address other challenges facing the grid and grid supply chains. 

Complementing OE, CESER plays a critical role in strengthening the security and resilience of the U.S. energy grid and securing U.S. energy infrastructure from cyber threats. CESER’s budget structure has also been reorganized for FY27. The new Threat Analysis and Incident Response (TAIR) program seems to merge the former Policy, Preparedness, and Risk Analysis and Response and Restoration programs, while the Infrastructure Hardening and Technology Development (IHTD) program appears to inherit the former Risk Management Technology and Tools program. Assuming this is the case, TAIR faces a 31% budget reduction from $57 million in FY26 to $39 million in FY27; IHTD faces a 11% budget reduction from $110 million to $97 million. These cuts are concerning given the recent news of cyber attacks to U.S. energy and water infrastructure as a result of the war in Iran – the very kinds of attacks that CESER’s work is designed to prevent and address. 

The proposed Baseload Power account potentially offers a small amount of additional funding for CESER ($10 million) to “expand testing of supply chain components to identify and mitigate cybersecurity vulnerabilities.” However, that amount is only a third of the $30 million CESER stands to lose in FY27 funding if Congress follows the administration’s lead.

Spotlight: HGEO

HGEO was created during DOE’s reorganization by merging the Geothermal Technologies Office (GTO) with the Fossil Energy Office (FE).2 The new Office of Subsurface Energy is the largest office in HGEO, and it is composed of three suboffices: Coal, Oil and Gas, and Geothermal. Overall, the administration is requesting a 14% cut to HGEO’s budget, with the Office of Subsurface Energy facing a 19% cut. The Office of Geothermal maintains its funding at a constant $150 million, same as in FY26, while the Offices of Coal and Oil and Gas see decreases of 35% and 14%, respectively. 

The Office of Geothermal’s budget has been reorganized under new program categories, moving away from technology specific categories to a focus on supporting technologies at different levels of maturity: Pilots and Demonstrations ($92 million), Technology Research & Development ($40 million), and Commercial Scale-Up ($18 million). The Pilots and Demonstrations funding would continue the momentum from the $171.5 million Notice of Funding Opportunity (NOFO) for Enhanced Geothermal Systems (EGS) demonstrations, the largest federal funding commitment for EGS ever, in February. At the same time, however, the administration is also requesting a rescission of $25 million in remaining unobligated IIJA funding for the very same program, a counterintuitive move that seems to be for the sole purpose of expressing opposition to anything funded by IIJA. 

Under the Office of Coal, the Mining and Processing subaccount sees a dramatic 329% increase in funding for R&D aimed at modernizing coal mining and processing. This includes the application of AI tools and robotics to “extend the life of existing mines and coal-based power infrastructure”, reinforcing the administration’s ongoing use of executive power and taxpayer dollars to boost a declining energy source.

Lastly, the proposed Baseload Power account would offer an additional $1.94 billion in funding for coal, oil, and gas infrastructure upgrades to prevent 4 GW of coal power from retiring, preserve 5 GW of power from natural gas plants, and add an additional 3 GW of gas power – the single largest request for new funding in the entire DOE budget.

Hot Takes: What the FY27 Presidential Budget Request Means for Climate and Energy

President Trump released his FY27 budget plan last week. What should we think about it?

Once upon a time, the President’s budget was a realistic proposal to Congress about what the federal government should spend money on. These days, it’s essentially just a declaration of everything the President would do if Congress didn’t matter at all.

There’s an argument, then, that we shouldn’t take the President’s budget too seriously: after all, recent history shows us that Congress doesn’t. President Biden repeatedly asked for, and failed to receive, massive IRS expansion, housing investment, and tax hikes on the wealthy and corporations; President Trump last year suggested massive cuts to federal science funding that Congress essentially ignored.

Yet the current Trump administration has also shown that it’s not taking seriously Congress not taking it seriously: including by impounding funds and pursuing other avenues to push its spending (and cutting) priorities through using executive action.

The way to calibrate is by treating the President’s budget as a fever dream…albeit one that might come true. With that in mind, here are some of the key dream sequences we’re paying attention to from a climate, environment, and energy perspective. Warning: some may keep you up at night.

Topline numbers

In terms of non-defense discretionary spending, the $660 billion FY27 request is a 10% decrease from current levels – a smaller swing than last year’s $557 billion FY26 request, which proposed a 23% cut that Congress largely ignored. However, the difference can be attributed almost entirely to the fact that Congress reset the baseline upwards when it rejected those FY26 cuts, as well as to proposed increased spending at the Department of Veterans’ Affairs (for improving medical care) and Department of Justice (including funding for increased law enforcement in cities, funding FBI salaries, and re-opening Alcatraz).

For climate and energy policy specifically, FY27 largely runs the same plays as FY26: slashing line items related to climate change and advancing a fossil-oriented “Energy Dominance” agenda while rolling back clean energy and environmental justice investments from what this administration terms the Biden-era “Green New Scam”. As with FY26, the request targets climate, energy, and environmental programs with demonstrated bipartisan congressional support. One example is the CDFI Fund, which finances clean energy and community development lending in underserved communities and which Congress explicitly preserved last year after the administration first proposed eliminating it. 

Overall, the President’s FY27 budget request is less a new proposal than a budget formalization of many climate- and environment-related cuts that the Trump administration has pursued over the past year through executive action and impoundment. 

Energy

For the second year in a row, the Trump administration is requesting to cancel almost all remaining unobligated IIJA funding across the Department of Energy ($15.2 billion in total). What’s striking about these cuts is how indiscriminate they seem to be, including cuts to programs that align with this administration’s stated priorities (including critical minerals, geothermal energy, and hydropower). The throughline appears to be less about policy judgment than about demonstrating categorical opposition to anything passed under the IIJA banner.

Yet not all of this funding is being outright cancelled: some is being redirected. $4.7B of unobligated IIJA funding intended for Hydrogen Hubs is being steered toward baseload power and AI supercomputers instead. When you dig deeper into that redirect, it’s a mixed bag. $1.2B will go to new supercomputers at Argonne and Oak Ridge National Labs, as part of DOE’s new Genesis Mission. The remaining $3.5B would largely support coal, oil, and gas infrastructure upgrades and prevent 4 GW of coal plants from retiring as planned. The same tranche of funding will also support some genuinely needed improvements, such as strengthening grid reliability, installing new battery storage, and improving the power output of nuclear and hydropower facilities. Funding for geothermal, ostensibly an administration priority, is surprisingly absent given its status as a firm baseload power source.

Mixed messages around geothermal continue in the budget for the new Hydrocarbons and Geothermal Office (HGEO), created during DOE’s November 2025 reorganization by merging the Geothermal Technologies Office with Fossil Energy. The administration requests $676 million for the combined office, a 14.1% decrease from the FY26 enacted. The most striking line item within HGEO is a 329% surge in funding to modernize coal mining processes and extend the productive life of existing mines, including through the use of AI and robotics. Geothermal funding is preserved at $150 million, emphasizing pilots and R&D over commercial-scale projects. Again, what’s conspicuously missing – given the administration’s stated enthusiasm for geothermal as a firm baseload source – is any meaningful push toward commercial-scale deployment. 

Beyond the IIJA cancellations, the administration is requesting a massive 63% cut to the budget of the new Office of Critical Minerals and Energy Innovation (CMEI) – the reorganized successor to the former Office of Energy Efficiency and Renewable Energy – compared to the FY26 budget of the offices folded into it. The only winner seems to be critical minerals, which receives a $281 million (339%) increase in funding compared to FY26. Similar to FY26, the request zeroes out the budgets for hydrogen, solar, and wind programs, as well as state and community energy programs and the Federal Energy Management Program. The request also nearly zeroes out budgets for bioenergy, vehicle, and building technologies, while making deep cuts to hydropower and industrial efficiency and decarbonization technologies. 

Cuts continue for DOE offices responsible for keeping America’s lights on. The Office of Electricity (OE) and the Office of Cybersecurity, Energy Security, and Emergency Response (CESER) face cuts of 22% and 16%, respectively, from FY26 enacted levels: significant indeed at a moment when electricity demand is surging, extreme weather is straining grid infrastructure with increasing frequency, and the U.S. grid is already widely acknowledged to be aging and vulnerable. Underfunding these offices now carries real risk for the administration’s own energy dominance goals, let alone broader reliability and resilience.

Wildfire resilience

The two largest federal landowners – the Department of the Interior (DOI) and the U.S. Department of Agriculture (USDA) – are both slated for significant cuts under this budget, at 13% and 19% reductions from FY26 enacted levels, respectively. The takeaway: while the FY27 budget makes some new investments in wildfire resilience, it does so against a backdrop of overall austerity.

That said, the budget request acknowledges the escalating urgency of the wildfire crisis. Wildland fire suppression resources at DOI received a modest 3.5% increase; preparedness and fuels management at the agency also saw a slight bump. Additionally, the budget introduces a Fire Intelligence and Technology line item in DOI’s budget funded at $123.5 million. This includes $20 million to support a Wildfire Intelligence Center that appears broadly aligned with proposals such as those laid out in the bipartisan Fix Our Forests Act (S. 1462), which FAS endorsed. 

The real-world efficacy of these wildfire-specific investments could be undermined by cuts to fire-relevant research and monitoring infrastructure. While the request states that “the USWFS will fund all wildland fire resources currently funded separately by [USDA and DOI],” proposed cuts to Forest Service programs such as State, Private, and Tribal Forestry and Forest and Rangeland Research could also impact fire resilience.  Budget cuts and layoffs at FEMA, NOAA, NASA, and EPA could also materially compromise capacity for other critical wildfire tasks the government is responsible for (e.g., fire detection, fire response, weather forecasting, smoke monitoring, and post-fire ecosystem assessment). For example, the NASA/USGS Landsat program helps us understand the impact of wildfires on the landscape and support better management. NASA’s FY27 budget justification allocates $109 million “to support a phased transition of the Landsat program to a commercial solution” rather than continued government involvement. The justification offers no detailed rationale for why privatization is the right path forward.

Cuts to USDA Forest Service Wildland Fire Management accounts reflect the Administration’s intent to consolidate wildland fire functions across DOI and the Forest Service. Echoing an earlier Executive Order, the budget proposes fully unifying the USDA Forest Service’s wildland fire resources and operations into Interior’s newly created U.S. Wildland Fire Service (USWFS). While DOI has reportedly begun consolidating wildfire operations across its own agencies under the USWFS, integration of the Forest Service is on hold; FY26 appropriations bills directed Interior and USDA to contract a feasibility study of this approach. It is unclear how this reorganization would interact with the recent proposal to move Forest Service headquarters to Salt Lake City. 

Environmental pollution 

From an environmental protection standpoint, the most glaring single number in this budget is President Trump’s proposal to cut EPA’s budget by $4.6 billion — a 52% reduction that would bring the agency to its smallest budget since the Reagan administration. How does the administration propose slashing the EPA’s budget by more than half? By targeting specific programs that have historically done some of the agency’s most consequential work.

Among the casualties: the program that oversees Superfund site cleanup. Superfund sites are locations that are so contaminated by pollution that they’re considered dangerous to human health. Think sites of former mines, toxic waste dumps, and other nastiness that make the families that live around them very sick. There are more than 1,800 Superfund sites across the United States, concentrated heavily in Texas, California, Pennsylvania, New York, New Jersey, Florida, and Washington. Without the Superfund program, cleanup won’t happen, and families living nearby – who often can’t afford to move or don’t even know the risk exists – will just keep getting sick. 

Like breathing clean air? Happy the ozone layer is healing? Too bad. If Congress follows the President’s proposed budget, then the Atmospheric Protection Program will be eliminated. The APP is the EPA office responsible for reducing air pollution, restoring the ozone layer, improving energy efficiency, and researching climate change. These aren’t marginal cuts. They’re core federal functions that have measurably improved air quality and public health over decades.

The contrast with what the EPA is being asked to invest in is telling. One notable increase in EPA’s budget is a $14 million boost for NEPAssist, the web-based tool that streamlines permitting under the National Environmental Policy Act. This boost reflects the administration’s vision of what EPA is for: making it faster to approve projects, but not study or reduce the pollution they might produce.

Energy affordability, extreme heat, and public health

The FY27 proposal once again tries to eliminate the only sources of funding to support families struggling with energy affordability. The proposed budget would fully defund the Low Income Home Energy Assistance program, which supports families with heating and cooling bills at a time when one in three American households are facing energy insecurity and electricity rates are surging across the country. The budget also zeroes out the Weatherization Assistance Program, which funds home retrofits that reduce energy consumption and help families stay safe during extreme heat and cold. Getting rid of both LIHEAP and WAP simultaneously leaves no federal backstop for the most vulnerable households at the precise moment that climate-driven temperature extremes are intensifying.

The FY27 proposal also targets research and data collection critical to evaluating extreme weather and heat’s risks and impacts. The proposed $1.6 billion cut to NOAA’s Office of Research and Development by $1.6 billion would eliminate programs to help communities prepare for and protect against extreme heat events, flooding, and other climate-linked weather hazards. The planned commercialization of NASA’s Landsat raises further concerns about data continuity and access, particularly for local governments and planners who depend on Landsat data to assess heat islands, drought conditions, and other environmental risks.

On the health system side, the budget would eliminate the Hospital Preparedness Program (HPP), the only program supporting health care systems ready for all hazards – including floods and storm surge that can inundate hospitals, and extreme heat waves that can overwhelm emergency rooms. HPP funding has helped regions such as the Pacific Northwest, where extreme heat has already been deadly, avoid repeating past disasters. The budget proposes redirecting these functions to the CDC’s Public Health Emergency Preparedness program, which experts have long identified as insufficient for the scale of the need.

Workers and families face additional exposure under this budget, which scales back prevention and enforcement dollars for workplace safety. The proposal budget cuts the Occupational Safety and Health Administration’s budget by 10%, with reductions focused on enforcement capacity and workplace safety training funding. And two of the primary federal vehicles to support community-level climate resilience would be eliminated. The Community Services Block Grant and the Community Development Block Grant, have both been backbone sources of funding to support efforts to prepare communities for extreme weather’s impacts. For example, the Community Services Block Grant provides the operational funding for Community Action Agencies, which are a key pass-through organization for implementing efforts like home weatherization.

Climate and environmental science

The FY27 budget doesn’t just target programs aimed at reducing emissions and cleaning up our environment. It targets the scientific infrastructure that tells us what’s happening and how to fix it. The President’s budget request would systematically defund the agencies, offices, and university programs responsible for climate observation, modeling, and research across the federal government. NSF has historically been the nation’s primary funder of basic research, including the university-based science that generates most of what we know about climate systems, ecosystems, and environmental change. The administration proposes cutting roughly 55% (~$5 billion) from NSF’s budget, with about a third (~$1.8 billion) of this coming from the parts of NSF (geosciences, biological sciences, engineering, and polar programs directorates) most directly relevant to climate and environmental science. AI and quantum computing are the only areas the administration proposes to protect or grow within the agency.

The DOE’s Office of Science would take a $1.1 billion hit, with just under half of that coming from the Biological and Environmental Research program, which funds atmospheric science, climate modeling, and ecosystem research. The administration’s own budget language is candid about the intent: these cuts will, it states, “stop wasting Biological and Environmental Research resources on climate change” and refocus funding toward “AI-enabled earth-energy system modeling to support the Energy Dominance agenda.” At the same time, $1.1 billion is being invested in the new Office of Critical Minerals and Energy Innovation (CMEI), though this number is both a cut compared to FY26 enacted levels from CMEI and is framed explicitly around supply chain security and domestic resource extraction rather than decarbonization.

For the second year in a row, the budget proposes eliminating NOAA’s Office of Oceanic and Atmospheric Research, which houses the nation’s core weather forecasting and climate modeling capabilities (including the Geophysical Fluid Dynamics Laboratory, the birthplace of modern climate modeling). What’s notable about the FY27 request, as analyst Alan Gerard points out, is that it doesn’t even acknowledge OAR’s existence despite Congress having essentially fully funded it in FY26. This illustrates the administration’s willingness to pursue its biggest priorities by hook or by crook.

Finally, EPA’s research and development budget would be reduced to only what federal law legally requires, effectively eliminating the agency’s in-house capacity for the modeling, technical research, and expert analysis that underpins national environmental regulation. An EPA stripped of scientific capacity is an EPA that can neither generate the evidence base for new rules nor credibly defend existing ones.

From Lab to Life: Research Questions for the Taking

For the last 4+ years, I’ve sat at the intersection of local governments and universities. That time has been used to be a convener, a communicator, and importantly, a student. These two types of institutions are critical to our communities. How do they work together? How can they support each other? How can we think differently about their relationship to one another – moving beyond big employers and land users to thinking about the fruits and labors of what the research community can do for local policy making. 

From my personal experience and that of my time at MetroLab, one thing was clear: we need to focus on the demand and supply for research to the local government community. While well intended, much of the research community assumes what local governments need. How can we break these assumptions and understand what the true research needs are for cities and counties across the country? 

Inspired by the annual Administration Research and Development Budget Priorities issued by the White House Office of Science and Technology Policy, MetroLab envisioned an opportunity for a priority research needs document that is informed by, and in the service of, local governments. 

This effort came with ambitious goals. First, it needed to represent local governments across the country. To do this, we knew we had to have a breadth of scale; we needed to talk to folks inside local governments that “live in the weeds.” We knew that it was important to get the perspective of local governments across all geographies with varying priority concerns and varying levels of resources. In-person workshops were a must to meet the community where they are.

Next, it needed to make sense to the research community. Each in-person workshop was hosted on a university campus. Every single research question that resulted from the workshops or the surveys has been reviewed to be presented in a way that can easily shape a research project or program. 

We set out to work, hosting workshops and surveys. At our in-person workshops across the country we had a total of 42 universities represented, 12 local governments (with 85 unique departments represented in total). We recovered hundreds of Post-it notes and created a master database of over one thousand research questions or points of feedback.

With gratitude and enthusiasm, we are publishing the results. In total, FAS is publishing nineteen reports, including the overarching findings  – The Civic Research Agenda. 

7 POLICY SPECIFIC RESEARCH AGENDAS9 CITY/COUNTY SPECIFIC SCIENCE R&D REPORTS1 RESEARCH TO-IMPACT-REPORT
HousingCity of Allentown, PAThe Research-to-Impact Ecosystem: Perceptions, Barriers, and Recommendations
Economic DevelopmentCity of Baltimore, MD
Human ServicesCity of Columbus, OH
Climate and EnergyGuilford County, NC
TransportationCity of Houston, TX
Community EngagementCity of Kansas City, MO
Service DeliveryCity of Lincoln, NE
City of Little Rock, AR
City of Syracuse, NY

Importantly, we learned more than just research questions. We studied how these institutions work together, what are friction points, and how transformative partnerships thrive between the research and local policy making communities. 

For example, we asked folks for both institutions, what myth do you want to bust? And this is what we found: 

Myths local governments would like to “bust” – in other words, statements they believe university communities believe but are untrue –include the following:

  1. [21%] that local governments have a lot of money available, are themselves adequately resourced, and have ample time to read large amounts of research
  2. [20%] that local government staff are uninformed, not smart, or not resourceful
  3. [16%] that local government staff lack motivation, are lazy or don’t care, and want to preserve bureaucracy
  4. [13%] that local governments cannot innovate and adapt
  5. [13%] that local governments are hard to work with, and in particular, they resist academic insight
  6. [6% ] that local governments are not data-driven 

Generally, local governments aimed to position themselves as capable partners, and to correct structural misconceptions. 

Myths universities would like to “bust” – in other words, statements they believe local government communities believe but are untrue include the following:.

  1. [25%] that universities are elite; faculty live in an ivory tower
  2. [19%] that universities produce research that is impractical, only theoretical, or not client-driven
  3. [15%] that universities only care about publishability, and faculty/staff do not care about their community
  4. [11%] that universities are slow, research takes a long time, and they can’t work quickly
  5. [11%] that universities have a lot of money and funding is not constrained
  6. [11%] that research only takes into account quantitative data

Almost half of all responses indicate that faculty and staff at a university feel they are perceived as detached, selfish, or difficult partners. University participants wanted to convey to the audience that research is indeed useful, applied work matters, and that research is impact-oriented.

Why does this matter? It’s a foundation on which to build. Bringing two institutions together should include the following considerations: how do you know who to talk to, what are the levels of trust to work together, and how do you consider potential road blocks from the start. 

Recommendations

First, the primary goal of this report is to provide to the research community these questions that are in demand by local governments. But that is just the start. They must then get answered, and they have to be produced in a way that optimizes  the “supply” of research – will research publications be applied. 

Some top findings on how local governments want to ingest research: 

One hundred percent of respondents cited that a concise summary of results that is easy to understand is very important or important. No more than one page and no technical jargon.

One hundred percent of respondents also cited that research needs to be as specific to their community as possible. 

Local governments almost always want to see a comparison to their peer cities/counties.

As appropriate, research that goes beyond observation and makes recommendations is highly actionable. 

I’m going to say this again. ONE PAGE. Executive summary no more than one page. I know. Not the easiest. 

What’s Next

I hope these research questions get answered. Imagine the world of what’s possible if these questions are addressed. If these knowledge gaps close. We could have increased housing supply, understand the impacts of our policy interventions, and can do more with less.

The Civic Research Agenda considers civic research as infrastructure. Treating the pipeline as civic infrastructure means making collaboration predictable and durable. It could include elements such as:

These are solvable problems. If local governments and universities can commit to creating and maintaining the coordination and collaboration required, we can unlock policy innovation for communities across the country, starting at the state and local levels. 

This report is a roadmap that will move further the theory of change that our research ecosystem has a bounty of insights and policy interventions, and when done in partnership with local innovators, catalytic impact is in our grasp. 

FAS looks forward to continuing this work, and hopefully, bringing research problem statements and answers to communities across the country.

Feedback from Community Leaders

“As Kansas City’s top research university, the relationship between UMKC and the City of Kansas City is vital,” said UMKC Chancellor Mauli Agrawal. “When we closely collaborate with the community, we’re able to align UMKC’s advanced innovation capabilities with the city’s needs, ensuring that the solutions we generate have a direct, positive impact on the quality of lives of our residents. It’s important to note that our university’s community partnerships are not just about advancing academic inquiry — they are about building a stronger, more resilient Kansas City.”

“If we want to make positive, lasting progress on the most pressing challenges facing our cities—from gun violence and homelessness to transportation and traffic safety—we must be able to access and understand cutting-edge research and innovation,” said Kansas City Mayor Quinton Lucas. “MetroLab is working to make it possible for policymakers across the nation to influence the creation and pioneer the implementation of evidence-based solutions and research to help us build more equitable and thriving communities.”

“The City of Lincoln welcomed the opportunity this convening presented to catalyze our research partnership with the University of Nebraska-Lincoln. Following the workshop, we have continued to collaborate with UNL to develop the City’s Research Agenda.” – Mayor Leirion Gaylor Baird, Lincoln, NE

“Research is essential to us. We hosted six university institutions at our workshop and are keen on continuing these conversations. We want to have the data to provide tailored solutions to each of our individual neighborhoods, we want to know what programs get the best outcomes, and we hope to partner with our universities to better our evaluation capabilities so that we know what’s working and what needs to be improved.” – Mayor Matt Tuerk, City of Allentown, PA

“The event was a huge success, not only because it was well-attended and well-run, but because the participants responded with action.” – Dr. Ruth N. López Turley, Director, Kinder Institute for Urban Research

Buzzwords like ‘Abundance’ and ‘Affordability’ are out. Learning policy lessons from the global community is in.

Something is wrong with American policymaking. There are obvious issues: hyperpolarization, deep public distrust of government, and outdated institutions make it difficult to implement durable laws. Pundits and think tanks try to overcome those issues by developing new framings, like ‘Abundance’ and ‘affordability’, that too often lack specific policy ideas and instead put style before substance. 

Rather than get caught up in the buzzword flavor of the month, the policymaking ecosystem should study what’s actually working. Many other countries have figured out how to develop cohesive policy agendas that deliver on their promises and build trust with constituents, resulting in improved outcomes in education, healthcare, housing, transportation, and energy—things that America still struggles with. 

We can learn valuable lessons from those governments about how to build more durable, more responsive, and more effective policy. The models discussed below offer a starting point; examples of how prioritizing implementation, outcomes-first design, and long-term and inclusive planning can result in better governance—across countries with very different political systems.

What’s not working? 

The policy tools we currently have at our disposal are not working. Faced with a dysfunctional Congress, policymakers rarely pass new laws and instead stretch old ones to fit purposes they weren’t designed for. When well-designed policies are passed, agencies often lack the workforce, funding, and organizational infrastructure to actually implement those ideas. This failure to deliver further hurts an already declining level of public trust in institutions, but it also means that Americans lose out on basic needs. Homeownership feels unobtainable for growing portions of the country. An outdated grid and rising energy prices strain communities (while an ongoing war in Iran worsens those issues and further drains federal funding). Oversized, high-emissions cars create health and safety hazards while accessing healthcare to treat those hazards can bankrupt a family.

The federal policy ecosystem’s responses have been underwhelming, despite the urgency. Consistent policy confusion, poor organization, and hyperpolarization—exacerbated by the Trump administration’s destruction of agency infrastructure and workforce—all contribute to the struggle for durable and meaningful change. The ecosystem lacks a unifying policy objective that can act as a foundation for policymakers, a set of guiding strategic principles to return to when designing and implementing policy. 

Instead, those in the Beltway look for new ways to package broad solutions. Movements like “Abundance,” or slogans like “affordability” and “dominance” might be catchy, easily marketable, and play to a big audience (or the right political network) but they lack technical substance and specificity. Abundance has been applied to everything from large-scale clean energy supply to more effective prisons, and we still don’t have a roadmap for how to actually achieve energy affordability. Even “social justice” and “diversity, equity, and inclusion,” concepts which have real academic foundations and a deep history of implementation in a range of socioeconomic fora, were co-opted after the murder of George Floyd in 2020 and applied to a whole universe of policies that didn’t always reflect the original goals of the movements and in turn undermined the actual meaning of those words. 

That approach might work to win elections, bump up polling numbers, or increase influence in the policy world, but it doesn’t actually get tangible results. Ultimately, Americans care less about Abundance than they do about outcomes: affordable houses; sustainable wages; reliable energy; quality education and childcare. So how do we get policymaking apparati to focus on deciding on the present before the wrapping paper?

How do we get it right?

To start, we can look to the rest of the world. Other governments have been successfully putting substance ahead of style—and delivering on their promises—for decades. America’s insular attitude towards domestic policymaking is supported by a culture of American exceptionalism and a view of ourselves as the ideal democratic state (although we invented some of those metrics).

That view is both incomplete and inaccurate, leaving out imperialistic tendencies, hundreds of years of oppressive policies, and the bargaining strength of being the world’s sole superpower. America is outpaced on a number of critical fronts by other countries. Building rail infrastructure costs 50% more and takes longer in the U.S. than in Europe or Canada. Americans pay more per person on healthcare than other developed countries despite faring worse on certain outcomes, including higher maternal mortality rates and lower life expectancy. Poverty rates are some of the highest among OECD countries, with more workers earning “low pay” than any other OECD country. 

That view is also limiting. It encourages policymakers to continue the ‘style over substance’ feedback loop, investing in ideas that are culturally aligned with that perspective instead of in new, ambitious ones. Those new and ambitious policy ideas don’t have to be novel – they could come from places that are succeeding where we’re falling behind. 

Many other countries have figured out how to put substance first. The examples below start with a more internally cohesive theory of domestic policy or central guiding principles, like strong government capacity, outcome-focused policy design, and an emphasis on social wellbeing, and build the messaging platform later. They focus on reflecting the actual wants and needs of constituents rather than projecting how they think the public feels about government.

Nordic countries

Several Nordic countries, including Sweden, Finland, and Norway, illustrate one model: a welfare state with social democratic tendencies, robust social safety nets, and high levels of trust and public investment in social goods. These countries start with basic principles—that government should provide a reasonable standard of living for all citizens—and the policy substance follows from there. 

Their systems of governance are built on a tripartite policymaking structure that allows for meaningful, long-term engagement between government, industry, and labor. America might not have the infrastructure (or the desire) to implement a tripartite system, but it points to deeper values that underscore their policymaking. The Nordic model values public participation—not just on one-off projects, but throughout the process. It’s not direct democracy, but co-creation by bodies that represent the organized interests of major economic players. Public participation that’s meaningful, consistent, and long-term creates buy-in from those interests and durable policy. It’s also something that the United States consistently grapples with. 

Nordic governance also supports policy design that’s targeted at specific outcomes, but integrates considerations from multiple sectors. Sweden has spent decades investing in clean energy technologies and deploying clean electricity—but has also implemented cross-cutting policies that target other areas of the transition. Several are aimed at reducing energy poverty, including subsidies, energy-inclusive rent, builder incentives, and efficiency standards. These policies are outcome-based, but are coordinated across multiple ministries rather than being siloed within one. The result is an “energy” policy that supports a clean transition but cuts across social services, labor, housing, and energy. The United States has tried this approach before with bills like the Inflation Reduction Act, but issues with implementation and government capacity limited the success of the bill. 

Another example is Finland’s ‘housing first’ initiative. It’s firmly rooted in a tangible outcome—securing housing for everyone, shored up with social service support and community integration. It’s been hugely successful, reducing long-term homelessness by 68% since 2008. Finland’s program is deeply integrated across federal, state, and local governments and civil society organizations, providing proof of concept for community navigator mechanisms that allow community expertise to steer federal dollars.

These policies deliver on their promises: housing, energy access, poverty reduction. Combining public participation with real delivery supports a continuous positive feedback loop of high trust, which creates an easy argument for more investment in the government that implements these policies. That’s necessary, because the reason this model delivers so well is that it relies on a public sector that’s well-funded by high tax rates and redistributive economic policies (which in turn are backed up by the economic powers of the tripartite system). Americans may balk at high taxes, but that’s partially because they don’t see the impact in their daily lives. They don’t trust the government to do the right thing with their money. Breaking into that low-trust cycle is difficult, but we have to start somewhere. 

China and Singapore

Singapore and China showcase another model. Although lacking in political freedoms and public participation, both countries offer examples of how to build transportation, energy, and housing infrastructure fast and well. At the core of this building is an emphasis on governance and implementation, long-term planning, and public investment in human capital. 

Singapore is consistently held up as an example of good governance in both policy design and implementation. It’s fully integrated scenario-planning and foresight tools into its policymaking processes, allowing government to be more proactive in tackling barriers and achieving desired outcomes. This type of long-term planning is only possible with detailed policy agendas and sustained commitment to outcomes. It also requires investment in and retention of a talented civil service, which additionally supports cross-government functionality, program longevity and durability, and smooth implementation of policy. 

The state’s successful delivery on social outcomes like education (students comfortably outperform the OECD average), healthcare (high life expectancy and low maternal mortality at lower-than-average prices) and economic development (doubling GDP per person over the last 20 years) helps reinforce trust in the ruling party, further strengthening its ability to continue to have outsized agency in policymaking. Some of these elements are harder to implement in the United States, given the inherent instability of changing administrations, but it underscores the need for agreed-upon foundational principles regardless of who’s in power. 

China employs similar strategies. Both China and Singapore have well-developed industrial policies – something the U.S. has lacked for several decades. China has spent years intentionally subsidizing specific industries, like transportation, clean energy, and technology, with comprehensive public spending strategies and long but detailed implementation timelines. It invested in both human and physical infrastructure, now boasting the largest industrial workforce in the world who are trained to continuously innovate. These investments have paid off: China leads the world in solar panel and electric vehicle manufacturing, has rapidly expanded its transportation networks, and has built so much housing that it helped contribute to a real estate crisis. This targeted, long-term engineering of economic development in both countries underscores the power of policy durability, strong governance, and administrative discipline in public sector delivery.

Similar to the Nordic model, Chinese and Singaporean success with delivering on outcomes is the result of high levels of trust. But their models also work because those governments enjoy a high level of agency that only exists because of the lack of liberal democracy. But the underlying principle—that government needs some amount of empowerment to make decisions—is not incompatible with U.S. aspirations. Many of the ‘lessons learned’ reports on the successes and failures of the Bipartisan Infrastructure Law and the Inflation Reduction Act lament slow decision-making that was drawn out by consensus-based processes and multiple layers of overlapping approvals across agencies. Adopting principles of agency and empowered decision-making could speed up countless government processes, improving delivery. 

None of these models is perfect. Rapid industrialization in China has led to massive pollution issues and Singapore struggles with an over-reliance on foreign labor and income inequality. Both countries have serious democratic and human rights challenges. In Sweden and Norway, consistent problems with anti-migrant sentiment sow discord and threaten policy successes. Americans should be looking beyond the surface of these policies. We don’t need to copy the designs verbatim, but rather figure out what principles we want to borrow form the foundation of our own policy agenda. 

What those principles should be is an open question, but not an impossible one. Americans value social goods, and they trust their government when they see the impact of their investments, but they also want choice. How do we identify those principles, translate them into real policy designs, and then implement them sustainably? How do we scale up existing trust and rebuild trust that’s broken? How can we create an administrative state that actually delivers on its promises to constituents?

 Building a more positive policy vision

There’s no silver bullet, making the revolving door of movements like Abundance even more frustrating. Those wrappings without substance, promising catch-all solutions, take up oxygen that could be better spent taking a step back, trying to figure out what kind of country we want to live in, and learning from those who are making it happen. 

The good news is that there is quite a bit of agreement among the public when it comes to that vision. Like many other communities around the world, we want our lives to be better. We want safe and healthy communities, a stable financial system, freedom of choice, and systems that deliver on the promises they make. Other countries have succeeded in achieving some of those outcomes. It’s worth looking around to see what we could learn.

Clearing the Roadblocks to Transportation Innovation

Breakthrough technologies are emerging rapidly throughout U.S. transportation systems, from AI-enabled traffic management pilots by state DOTs to the continued expansion of automated vehicle (AV) testing and deployment. Yet the institutions responsible for researching, testing, and deploying these innovations were largely designed for a different era, with funding and governance structures organized around distinct transportation modes, limiting their ability to integrate cross-cutting, system-level technologies.

Over the past few years, the Federation of American Scientists (FAS) has engaged hundreds of local governments, researchers, industry leaders, and transportation experts to better understand where the most pressing transportation R&D gaps lie. These insights informed FAS’ recent recommendations  to the Department of Transportation’s (DOT) as it shapes its Research and Development (R&D) Strategic Plan. 

Talking with hundreds of people, so many kept saying the same thing: the biggest barriers to transportation innovation are not purely technical – they are structural. Innovation is happening across the ecosystem, but it is often fragmented, slow to deploy, and poorly coordinated across jurisdictions. Addressing structural barriers will require a more coordinated national approach to transportation innovation, including fully funding the Advanced Research Projects Agency-Infrastructure (ARPA-I), strengthening DOT’s role as a national convener, and investing in regional research networks that can bridge the gap between research and real-world deployment.

Infrastructure & Innovation Are Moving at Different Speeds

Our national transportation infrastructure was designed for station wagons, not the innovations of today and those yet to come. Roadways, signals, and transit systems were built around relatively predictable patterns of vehicle ownership and travel behavior. However, today, cities are navigating shared mobility, micromobility devices, automated vehicles, and digitally connected transportation systems operating simultaneously. 

At the same time, many promising technologies already exist that could improve transportation systems. Advanced sensing tools, AI-enabled traffic management systems, and connected infrastructure platforms have the potential to improve safety, reduce congestion, and enhance system resilience. Advanced construction methods and materials are being developed to the point where efforts like ARPA-I’s eXceptional Bridges through Innovative Design and Groundbreaking Engineering (X-BRIDGE) program can realistically set out to answer the question: how can we deliver bridges at half the cost, in half the time, and with twice the lifespan?

The challenge? Deployment. Traditional procurement and financing models are often designed for long-term infrastructure projects rather than rapidly evolving digital technologies. Even when solutions are available, local governments may struggle to evaluate, pilot, and scale them. These challenges are particularly pronounced for smaller jurisdictions with limited technical capacity.

Emerging Technologies Raise New Research Questions

Innovation moves quickly, research and validation do not. 

Think of the automated vehicles piloted in a major metropolitan near you (we’ve seen them drop off some folks at FAS HQ). Demonstrating their safety relative to human drivers requires robust evaluation methods and standardized testing frameworks. Researchers must also better understand how automated systems will integrate with transit networks, emergency response operations, and existing road users.

Meanwhile, intangible data is becoming the backbone of modern transportation systems. Connected vehicles, smart infrastructure, and real-time mobility services all depend on the ability to collect and share large volumes of data. Sounds great, but transportation data ecosystems remain fragmented across jurisdictions and operators that limit interoperability and coordination.

Those we’ve spoken to have emphasized ensuring transportation innovation benefits communities of all sizes. Many emerging technologies are first piloted in large metropolitan areas, leaving smaller cities and rural communities with fewer opportunities to participate in early deployments. Accessibility considerations, including ensuring new mobility systems work for people with disabilities, must also remain central to transportation innovation efforts. 

Together, these challenges highlight the need for a more coordinated approach to transportation research, development, and deployment.

ARPA-I: Building a Stronger Transportation Innovation Ecosystem

Addressing these challenges will require a more integrated national transportation R&D strategy – one that combines breakthrough research, regional experimentation, and strong federal coordination.

How can we do it? Congress should fully fund and support ARPA-I. ARPA-I was designed to support high-risk, high-reward research capable of addressing systemic infrastructure challenges. Its milestone-driven model allows researchers to test ambitious ideas quickly and refine them through rapid iteration. This approach is particularly well suited to emerging areas such as digital twins for infrastructure systems, AI-enabled safety technologies, and advanced construction methods.

At the same time, DOT must continue strengthening its role as a national convener for transportation innovation. Federal leadership ensures that lessons learned from pilot programs are shared across jurisdictions, that data standards remain interoperable, and that research investments align with real-world operational needs.

Finally, investing in regional transportation research networks can help bridge the gap between research and deployment. Regional Centers of Excellence that connect universities, public agencies, industry partners, and nonprofit organizations can provide environments for collaborative experimentation, workforce development, and technology transfer. These networks would mean that small jurisdictions have opportunities to participate in innovation efforts.

Turning Research Insights into Action

The insights gathered from local governments, researchers, and industry leaders make one thing clear: the U.S. does not lack ideas for improving its transportation system. What it needs is a research ecosystem capable of turning those ideas into deployed solutions.

Fully funding ARPA-I, strengthening DOT’s innovation capacity, and investing in regional research networks would create a coordinated pipeline for transportation innovation. Congress can make this possible. Sustained appropriations for ARPA-I will ensure the agency can pursue high-risk, high-reward research programs that address systemic infrastructure challenges. Lawmakers can also support transportation innovation by directing resources toward regional research partnerships, Centers of Excellence, and workforce development initiatives that help state and local governments and manage emerging technologies.

Congress should also consider policies that modernize procurement and financing pathways for emerging transportation technologies, support interoperable data standards across jurisdictions, and provide targeted technical assistance to state and local agencies implementing advanced infrastructure systems. These steps would bridge the gap between research and deployment, particularly for smaller jurisdictions that often lack the resources to evaluate and implement new technologies.

Taken together, these actions would allow the U.S. to accelerate transportation breakthroughs while ensuring that innovations reach communities across the country. Building the transportation systems of the future will require more than new technologies, it will require building the institutions, partnerships, and policy frameworks needed to bring those technologies to life

What Happens When Unicorns Exist, But Don’t Exit: How the Reverse-Acquihires Trend Threatens the Future of Innovation

When competition looms, incumbents often tighten their grip on a market by snapping up rivals and rapidly shelving breakthrough technologies that could otherwise accelerate the next wave of innovation. We now find ourselves at a similar technological inflection point where rapid innovation in AI poses a deep challenge to dominant firms. 

To sidestep this challenge, large tech firms have adapted the acquihire—traditionally the acquisition of a company primarily for its talent rather than its products—into a structure that evades the regulatory scrutiny that would ordinarily accompany a merger of two companies. The result is the reverse-acquihire: unlike traditional acquihires these deals avoid antitrust scrutiny by replicating the benefits of an acquisition through alternative structures that stop short of an actual purchase. These deals allow dominant firms to both license a booming startup’s intellectual property and poach its top talent, often hollowing out the remaining company in the process. 

The trend first emerged in 2024 and has since become a go-to strategy of incumbents wanting to maintain a competitive advantage, with growing implications for the long-term health of Silicon Valley’s innovation ecosystem. Over the last two years a majority of major American tech firms such as Google, Amazon, and Microsoft have turned to this workaround strategy.

Consolidation Across the AI Stack Harms Innovation

This consolidation is especially consequential because it spans the full AI stack—from cloud infrastructure and advanced chips to AI foundation models and the commercial software platforms that dominant firms already control and use to deploy AI at scale. As control over these layers becomes concentrated, costs rise and access becomes restricted, creating structural barriers for new entrants. Because each layer of the stack depends on the others, if even one piece of the AI innovation ecosystem gets locked up, it can stall the entire product innovation cycle. 

In traditionally structured acquisitions, regulators would assess whether a transaction could limit access to critical inputs or otherwise constrain future innovation across the ecosystem in an anticompetitive manner. When these deals go unexamined by regulators, the result is less diverse technological solutions available on the market. Such limitations hinder scientific advancements in AI, reduce safety, and slow the responsible integration of the technology into broader economic and societal contexts.

These deals also pose a concern for other companies seeking to utilize core AI infrastructure services as part of their own product innovation practices. Meta’s 2025 reverse acquihire deal with Scale AI, a company that provides data annotation services necessary for the development of AI models, led to competitors such as Google and OpenAI ending their contracted data acquisition services with the company over concerns regarding their proprietary information being provided to Meta – a direct competitor company. Before the signing of the deal, Google had been Scale AI’s largest client. This deal perfectly illustrates how reverse acquihires can destabilize critical industry relationships, and cause detrimental impact across the entire ecosystem.  

Reverse acquihires concentrate gains at the top, and weaken incentives for tech workers

The rapid emergence of the reverse-acquihire also risks breaking the unspoken social contract that powers Silicon Valley startups: top researchers and tech workers join startups for the chance at meaningful financial upside, autonomy, and accelerated growth, not just a salary. When startups opt for reverse acquihire deals, those key benefits become unevenly distributed. 

Traditionally, joining a startup came with the expectation that all employees would share in the upside of a successful exit or acquisition. With a reverse-acquihire, however, investors and select staff benefit first, and remaining employees are usually left behind financially. This stands in stark contrast to the industry norm and undermines the financial incentive structure that draws talent to early-stage companies in the first place. Instead, knowledge and talent is funneled into the walled gardens of dominant firms while deepening inequality within the industry. 

There is also a tangible labor market harm to tech workers. As these deals become more common, prospective hires must now assess not just the strength of a startup’s mission, but whether its founders will pursue a traditional, team-inclusive exit—or quietly cash out early. This added uncertainty deters risk-taking and creates a new class of winners and losers within the startup ecosystem, divided by who benefits from these lucrative deals and who gets left behind. The most sought-after AI researchers, scientists, and tech workers often choose startups for the chance at hyperprofitable exits. Remove that incentive, and they’ll opt for lower-risk roles at already dominant firms, thus reducing breakthrough product developments for us all. 

This trend also impacts potential future founders in the ecosystem. Early hires who successfully exit a startup commonly use those earnings to bootstrap their own venture in the future. This dynamic famously played out across tech in the 2000s with the “PayPal mafia” diffusing both talent and capital in a manner that led to many successful tech companies being formed. Reverse acquihires could weaken this feedback loop.

Reverse Acquihires Could Break the VC Model

In addition to constraining future innovations and reducing the potential financial upside for startup employees, reverse-acquihire deals also threaten to destabilize the broader venture capital ecosystem. Typically, VC-backed companies favor acquisitions over IPOs, as they offer a faster, more predictable financial exit for investors, largely insulated from market volatility. Acquisitions also provide greater economic certainty and immediate liquidity, which can be especially appealing to venture capital firms. In contrast, IPOs are lengthy, complex processes that are highly sensitive to market conditions and external factors that can significantly impact valuations and, ultimately, equity holder and investor payouts. 

If the reverse-acquihire trend continues, VC funds may increasingly lose the opportunity to invest in and fully realize financial returns from the next generation of unicorn AI companies. Without the outsized returns generated by mega-successful exits, the traditional venture capital model becomes difficult to sustain. As a result, the institutionalization of reverse acquihires across the tech industry could have a chilling effect on the flow of capital into smaller companies and startups that are creating the next big breakthrough. This trend is particularly harmful for AI innovation because the field is highly resource-intensive. Cutting-edge research conducted outside of dominant firms requires significant capital for datasets, cloud infrastructure, and specialized hardware, resources that startups typically access through venture capital.

Regulatory scrutiny is rising, but the risks extend beyond AI

With the Federal Trade Commission’s recent announcement of an investigation into these practices, questions about the evasion of antitrust laws will likely receive greater scrutiny. A member of the Commission has even publicly commented on the threats these deals pose to innovation. What remains largely absent, however, is a broader conversation about how the widespread use of these deals could reshape the full innovation ecosystem itself. While reverse-acquihire arrangements have so far been concentrated among AI-adjacent startups, their implications extend far beyond this sector. Similar structures could easily be deployed in other emerging fields, including biotechnology, where a reverse acquihire might prevent life-saving medical innovations from ever reaching the market. 

When dominant firms consolidate technological talent and ideas solely for internal advantage, they do more than just preserve their competitive edge in a market. They also slow the pace of progress across the entire field. If reverse acquihires become the default path for absorbing promising startups, the dynamic competition that has long defined the American technology sector risks being replaced by a cycle of defensive consolidation that suppresses innovation to the detriment of our country as a whole.

2026 Is Year of the Female Farmer. We Spoke to Five Who Are Also Technologists.

According to the 2022 Census of Agriculture taken by the U.S. Department of Agriculture’s (USDA) National Agricultural Statistics Service (NASS), the United States has 1.2 million female producers, or farmers, which accounts for 36% of the 3.4 million producers nationwide. The producers hail from all over the country, but the state with the most female producers was Texas, a state FAS Impact Fellow Jodie McVane knows well.

Jodie, a Texas resident, has served as the Smart Agriculture and Forestry Impact Fellow at the USDA’s Natural Resources Conservation Service (NRCS) since 2024. Within NRCS, Jodie evaluates additions and modifications to the list of existing Smart Agriculture and Forestry practices which includes summarizing and presenting recommendations to NRCS and Farm Production and Conservation (FPAC) mission area leadership. 

“People who aren’t in agriculture ask me what work we do at the Ecological Science Division of the Natural Resources Conservation Service. I explain that we are taking traditional agricultural  practices and developing and implementing new technologies to assess and treat soil, water, air, plant, animal, and energy resource concerns. So I was really excited to be a FAS Impact Fellow doing a tour of service at the USDA. It has allowed me to expand my knowledge of emerging science as it applies to farming, and gave me an opportunity to work with others passionate about American farmers.”

Conversations with Female Farmers

Jodie’s work utilizing the latest technology and evaluating the best practices don’t happen in isolation. Part of Jodie’s day job as an Impact Fellow consists of building relationships with other agriculturists and farmers across the country. So she was thrilled to facilitate a conversation with female farmers Hannah Breckbill (Decorah, IA), Jess D’Souza (Mt. Horeb, WI), Corrie Scott (Benson, IL), and Lauren Reedy (Ben Lomond, CA), about what brought them to farming and what drives their passion for the field today 

Although some farmers, like Hannah and Lauren, nurtured an interest in agriculture from early childhood by playing farmer or spotting (and identifying) plants and flowers during their daily soybean walks, other farmers like Corrie Scott (Lauren’s sister) and Jess D’Souza didn’t find their passion for farming until they were adults. Jess didn’t even start thinking about farming until her early twenties. She told Jodie, “I started reading some books that had me questioning where my food comes from. I started farming in my own backyard. Then I started thinking about how exciting it would be to feed other people!” 

Meanwhile, Corrie, who grew up with Lauren on their family’s homestead, never thought she would go into farming. “I didn’t actually enjoy the farm stuff when we were little. I wanted to go out and see the world, and not stay close to home.” Corrie did in fact leave home, and it wasn’t until she spent time in Hawaii after college and started noticing that the state heavily relied on exports, that she wanted to be more intentional about learning where her food was coming from.

Building Community is Crucial to Success

The idea that one should be connected to how and where their food is grown is common among the group. All agreed that one of the vital ways to learn – and teach – was by building community, and as Jodie noted “women are good at that.” Corrie and Lauren actually found community by first realizing that although they don’t look like stereotypical farmers, they’re farmers all the same. “We’ve gotten more connected to other farmers,” Corrie said, “We don’t grow it all, we don’t want to grow it all. We’ve really been able to build a network of fellow farmers that start to connect in ways that candidly I wasn’t fully aware of.” 

Hannah’s story is similar. “As a first generation farmer…I didn’t even imagine I could access land ownership, but then my community made it happen.” The  land was up for auction and Hannah’s neighbors were concerned about potential future landowners exploiting the land or taking it out of agricultural use. They approached the previous owner as a group, asked her to name a price, and bought the land to prevent that from happening. State and local policies build on these community driven efforts by setting aside funding for farmland access through programs, like the The Farmland Protection Policy Act (1981), and other conservation programs, grants, and cooperative ownership models. These investments help reduce barriers for first generation and historically excluded farmers while keeping land in sustainable, community centered use.

Although Hannah found a community she can rely on – they are currently all pooling their money to buy additional farmland together – she still understands the strength in her unique identity. “When I talk about being a woman farmer, or a queer farmer, I am thinking a lot about how those identities inform the farming that I do. I farm in an intentionally sustainable and diverse way and that is, by nature, really different that the farming that is around me. Being a queer person helps me think up different ways of doing things. Being a woman means that I’m excluded from a lot of systems and mainstream ways of thinking about farming. That gives me a lot of freedom to do something different and do something in alignment with my values.” 

Jess works a state away but she agrees. “There is a robust agricultural community around me, and it has changed over the years to become more diverse in the people who manage farms. There is a change in what it has been and what it is becoming. This area has done well on addressing development and has set limits to protect agricultural lands. People are understanding the benefits of diverse farms.”

Public policy and investment in agricultural innovation, like USDA’s new Regenerative Pilot Program reinforce this shift. These efforts not only help protect farmland but also strengthen local economies, improve food access, and build more resilient communities. As technologies evolve, many are incorporated into farming practices.

Planting the Next Generation of Farmers

All four farmers agree that they have benefitted from their communities, but they also take the role of giving back and providing innovation for the future of their communities very seriously. One area of particular interest is community health. “That is a big heart issue,” Lauren says, “We are in the beginnings of our involvement with a food as medicine project that is starting in the state of Illinois with a few major players like OSF Healthcare.” This is near and dear to both Lauren and Corrie as they’ve watched family members develop neurological disintegration. The women attribute this to previous farmland chemical use. In addition to diversifying farm products and responsible use of chemicals, there is renewing interest in smaller scale, regenerative agricultural practices.

Another sentiment Jodie, Jess, Hannah, Corrie, and Lauren agree on? Agriculture is its own culture. “There is a big social aspect to agriculture, and we should never forget that,” said Jodie. Lauren immediately agreed saying, “Christa Barfield, the CEO of FarmerJawn in Philadelphia, is a friend of mine and her tagline is, ‘Agriculture is the culture.’ I think that circles back to everything we’ve said already. Agriculture is the culture because it is our food culture. It is our health culture. It is our social culture. Everything comes back to the soil.”

With 2026 being the International Year of the Woman Farmer (IYWF) and International Women’s Month being celebrated throughout March, it felt more than appropriate to highlight the experiences of women farmers in America.

Gil on the Hill: You can’t spell funding without “fun”

Me to the U.S. Government:

Paramount ©

This presidential administration has promised energy dominance, AI leadership, and a secure nation. What do all these things have in common? They cost money! And a functioning government apparatus to deliver. The first fiscal year of the Trump administration still hobbles on as the Department of Homeland Security flails about without funding and specially-funded Immigration and Customs Enforcement (ICE) get drafted in to run airport security. We’ve discussed the political potency of airport delays on shutdown scenarios before, and they’ll be playing their major part yet again as they reach the biggest delays in history. 

It’s a busy time and you have things to do. Here are three things worth tracking in science policy as Fiscal Year 2026 (FY26) wraps and we head into FY27.

DHS shutdown deal – too little too late? 

Politico: “‘It looks like everybody is going to stare at each other for a little while,’ Senate Majority Leader John Thune said Wednesday, before nodding at lawmakers’ best hope for getting a deal — their overwhelming desire to leave town.”

A Republican deal, blessed by the White House, to fund DHS, limit ICE enforcement, and include some parts of Trump’s desired voting law changes has hit major roadblocks that leave little optimism for a DHS shutdown conclusion by week’s end. If the Senate cannot pass something by Friday, the House will go home for the recess and the DHS shutdown will linger on at least another week.  

Congress is racing against the spring travel surge and the inevitable viral images of massive Transportation Security Administration (TSA) lines operated by ICE agents. Visuals like these speak thousands of words a floor speech cannot. 

Complicating matters is the growing possibility of another GOP-led reconciliation bill, also being mulled by President Trump, as an alternative path for delivering on various items like the Iran war, DHS funding, and Trump’s voting rules changes, but it’s unclear that would pass Senate rules scrutiny.

The White House published “A National Policy Framework for AI”

White House: “The Administration recognizes that some Americans feel uncertain about how this transformative technology will affect issues they care about, like their children’s wellbeing or their monthly electricity bill. These issues, along with other emerging AI policy considerations, require strong Federal leadership to ensure the public’s trust in how AI is developed and used in their daily lives.”

This framework addresses six key objectives regarding families, communities, intellectual property, censorship, innovation, and workforce. It’s the latest push against the “patchwork” of AI regulation as the Administration continues to demand a moratorium on state AI laws and acquiescence to a national set of rules. FAS has concerns about such an approach. 

This all comes against the backdrop of a great deal of legislative activity concerning data centers and as specific topics come into more of a focus, like a serious bipartisan look at AI use in courts, scrutiny of data privacy and supply chain security.

Science Funding – let it flow

FAS: “The Federation of American Scientists urges the U.S. government to release holds on Congressionally-appropriated funding for scientific research, education, and critical activities at the earliest possible time.”

The Presidential Budget Request for Fiscal Year 2027 should arrive in the coming days, and with it a barrage of budget hearings, oversight, and negotiation over topline priorities. We’re still checking the receipts from FY26, and lots of discrepancies remain to be sorted out about how (and if) that money was properly spent as legally prescribed by Congress. 

The first big flashpoint of the FY27 Presidential Budget arrives with OMB Director Russ Vought testifying on Capitol Hill on April 15th. Military funding, homeland security, and economic affordability will demand attention, but we cannot lose sight of how the slow-rolling of scientific funding is harming economic competitiveness, national security, and global scientific leadership. Core government functions, like grantmaking for research, are being directly and indirectly disrupted. It’s hard to see this Administration delivering on the promises of its agenda without the scientific progress to power us through unprecedented challenges presented by AI, energy, and an evolving national security landscape. My smarter colleagues put it more eloquently here. 

Ta-Ta for now! 

There is so much more to discuss, but we’ve only so much word count. Keep up the convo here GRuiz@FAS.org and let us know what you think. 

We’ll be closely tracking science funding budget hearings and FY26 spending accountability, the growing urgency around AI and emerging tech legislation, and the actions of the Trump administration as they helm the world’s greatest scientific enterprise of all time in the form of the U.S. government.