On AI specifically, IBM’s CEO Arvind Krishna has made headlines with a hard line. He’s pushing the Trump Administration to increase federal research and development funding for artificial intelligence and related technologies. This is especially true now, as President Donald Trump and his administration are pushing for deep cuts to federal grantmaking and scientific research programs. They propose to cut more than a third of the National Science Foundation’s (NSF) funding. Yet the administration continues to paint these funding investments as wasteful and “woke” spending.
Further cuts to important science research programs are included in this $12.3 billion proposed budget for fiscal year 2026. Central to accelerating safe, equitable, and beneficial AI research is the Directorate for Technology, Innovation, and Partnerships (TIP). It has been hit hard with deep budget cuts in recent years. Just last week, the Trump administration released its first explicit threat to repeal the CHIPS Act. This critical law, passed in November of 2021 during the Biden administration, is meant to increase domestic semiconductor production in the U.S. This act provides for the production of specialized chips that are key to AI applications.
Krishna Raises the Alarm
Krishna sounded the alarm about the impacts of far-reaching budget cuts. In fact, as he noted, IBM has already lost 15 federal contracts, resulting in a $100 million unexpected loss of anticipated revenues. While he acknowledged that federal contracts represent a modest portion of IBM’s overall business—ranging between 5% and just under 10% of its consulting practice—he emphasized the broader impact of federal R&D funding on economic growth and competitiveness.
“We have been an extremely strong advocate — and this is both the company and me personally — on that federally funded R&D should be increased.” – Arvind Krishna
As Krishna pointed out, we’re at historic lows for the share of the GDP that goes to federally funded R&D. He argues, rightly in our view, that boosting this funding could do wonders for the economy. It will further strengthen the global competitiveness of the United States.
Still, he’s very optimistic that we’ll see future governments do a lot more on R&D spending. “I expect that in a year […] federally funded R&D for AI, for quantum, for semiconductors — I expect it to be in as good or in a better shape than it is today,” he stated.
Author’s Opinion
The drastic cuts to federally funded R&D, particularly in critical fields like AI, could significantly hinder the U.S.’s competitiveness on the global stage. Investing in research and development is essential for sustaining technological leadership, especially as global competition intensifies. Maintaining strong funding in these sectors is not only crucial for advancing innovation but also for economic growth in the long term.
Featured image credit: World Economic Forum via Flickr
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