Harvard University, along with several other top-tier research institutions across the United States, is facing an unprecedented financial and academic crisis following a sweeping series of federal funding freezes and tax hikes imposed by the Trump administration. As the new academic year unfolds, the consequences of these political maneuvers are rippling through the country’s most prestigious universities, with Harvard’s Faculty of Arts and Sciences (FAS) at the epicenter of the turmoil.
On August 25, 2025, Harvard’s FAS announced a $1.95 million cut in non-personnel spending within its Arts and Humanities division, according to The Harvard Crimson. This move marks one of the most significant budget squeezes in recent memory for the faculty. The cuts are a direct response to a perfect storm of financial pressures: more than $2.7 billion in federal funding to Harvard has been frozen, and Congress, in a move championed by the Trump administration, raised the endowment tax on universities like Harvard from 1.4% to a staggering 8% in July. Harvard officials estimate these combined measures could cost the university up to $1 billion annually.
The impact of these federal actions is already being felt across campus. Critical research, including groundbreaking studies on cancer and Alzheimer’s disease, has been abruptly halted. Departments throughout Harvard have been forced to slash costs, pause capital improvement projects, and freeze hiring. While the Arts and Humanities division is the first within the FAS to face targeted reductions, other divisions such as Science and Social Science have also begun tightening their belts in anticipation of further cuts.
James M. Chisholm, a spokesperson for the FAS, confirmed to The Harvard Crimson that contingency plans developed earlier in the year are now being put into action. "While the environment we are operating in is fluid and any budget reductions are painful, our commitment to the FAS’s core academic mission of excellence in teaching and research – in service to the public good – remains unchanged," Chisholm stated, underscoring the sense of resilience that the university is trying to maintain amid the chaos.
The challenges extend far beyond Harvard. The Trump administration, through the Department of Government Efficiency (DOGE), has sought to claw back as much as $4 billion in National Institutes of Health (NIH) funding previously awarded to researchers. This aggressive approach has triggered crises at research universities nationwide, including Washington State University and the University of Washington, both of which rely heavily on NIH and other federal research grants, according to Pacific Northwest National Laboratory.
On August 24, 2025, the U.S. Supreme Court gave the Trump administration the green light to cancel $783 million in NIH research grants. The fallout has been swift and severe, with research universities scrambling to find alternative funding sources and faculty members facing the sudden loss of crucial support for their work.
At Harvard Medical School, the effects of these cuts are particularly acute. As reported in The Washington Post, young scientists like Tal Scully have seen their research projects grind to a halt. Scully, who once inspired lab visitors with her studies of sea squirts, now finds herself unable to continue her work due to the abrupt termination of federal grants. The situation is emblematic of a broader trend: the federal funding freezes and grant cancellations have severely affected research activities and faculty not only at Harvard but also at institutions across the country.
The FAS’s $1.67 billion budget is heavily reliant on its endowment distributions, which account for nearly half of its revenue, and on sponsored research support, which contributes about 12%. While federal funding might seem like a relatively small component, its sudden disappearance has set off a domino effect, threatening the university’s ability to maintain its research output, teaching quality, and overall financial stability.
In an effort to mitigate some of the damage, FAS Dean Hopi E. Hoekstra announced in May 2025 the creation of the Research Continuity Funding program. This initiative is designed to support senior and tenure-track faculty whose federal grants have been terminated, covering 80 percent of the operating expenses previously funded by those grants until June 30, 2026. In a July email cited by The Harvard Crimson, Hoekstra acknowledged the magnitude of the crisis: "These challenges are significant, and they will require careful, sustained work across the institution in the months ahead. Our early action, shared sense of purpose, and deep commitment to our teaching and research mission serve us well."
As Harvard grapples with the immediate fallout, negotiations with the White House are reportedly underway. According to The New York Times, the university may agree to pay $500 million toward vocational and educational programs in exchange for the restoration of its frozen research funding. However, such a settlement is controversial. A majority of Harvard faculty surveyed have expressed opposition to striking a deal with the Trump administration, fearing it could set a dangerous precedent and undermine the university’s autonomy.
Even if an agreement is reached, there is no guarantee that funding will return to previous levels. The Trump administration has signaled its intent to pursue broader cuts to federal agencies, slow down grantmaking, and specifically target research areas it disfavors, such as vaccine studies and race-related scholarship. This has left universities in a state of perpetual uncertainty, forced to adapt to an unpredictable and often hostile funding environment.
The crisis has also drawn attention to the broader political dynamics at play. The administration’s actions have been framed by some as a necessary move to rein in government spending and refocus public investment on vocational education and workforce development. Others see it as a targeted attack on elite institutions and research endeavors that challenge prevailing political narratives. The debate has spilled onto campuses and into public discourse, with stakeholders on all sides voicing concerns about the future of American higher education.
For Harvard, the $1.95 million slash in the Arts and Humanities division is more than just a budget cut; it’s a test of the university’s adaptability and resilience. The institution now stands at a crossroads, caught between political headwinds and the imperative to preserve its academic mission. How Harvard navigates this moment could have far-reaching implications, not just for its own future but for the landscape of higher education across the country.
As the academic year progresses and negotiations continue, all eyes will be on Harvard and its peers to see how they weather this historic storm. The outcome will likely shape the trajectory of research, teaching, and public trust in American universities for years to come.
