“Shakespeare’s evildoers stopped short at a dozen corpses. Because they had no ideology. Ideology — that is what gives evildoing its long-sought justification and gives the evildoer the necessary steadfastness and determination. That is the social theory which makes his acts seem good instead of bad … That was how the agents of the Inquisition fortified their wills: by invoking Christianity; the conquerors of foreign lands, by extolling the grandeur of their Motherland; the colonizers, by civilization; the Nazis, by race; and the Jacobins (early and late), by equality, brotherhood, and the happiness of future generations … This cannot be denied, nor passed over, nor suppressed.”
– Aleksandr Solzhenitsyn, “The Gulag Archipelago”
Writing in his 1973 magnum opus, “The Gulag Archipelago,” Aleksandr Solzhenitsyn described a deeply corrupt and rapidly decaying Soviet bloc. Ideology, he discovered, is the pathological thinking that corrupts the power-hungry and persuades the well-intentioned. When government institutions succumb to ideological capture, abuse and tyranny abound. While Solzhenitsyn wrote about Soviet Russia, his warnings are prescient in America today, where a more subtle form of ideological capture pervades government grant programs.
In the United States, the expanding reach of government grant programs represents a growing avenue for ideological influence. The sheer scale of America’s state-coordinated grant system, and its rapid growth, creates an environment ripe for the kind of ideological pathologies Solzhenitsyn cautioned against. Trump’s recent spending freeze and Musk’s efforts at DOGE are a step in the right direction but there is still much work to be done; the cancer of ideological grant spending requires immediate action.
To understand the magnitude of grant abuse, one needs only to follow the money. In 2020 alone, domestic 501(c)(3) organizations reported $301 billion in federal grant receipts — a 677% increase from 1991. For context, that’s more than the federal government spent in 2020 on Veterans Affairs ($220 billion), the Department of Education ($94 billion), and transportation ($85 billion). The COVID-19 pandemic likely contributed to a 34% spike in grant spending from 2019 to 2020, but the trend of rising grant expenditures predates the pandemic. From 1991 to 2019, grant spending increased by 474%.
While the IRS published aggregate nonprofit grant receipts every year from 1988 to 2020, the agency did not publish any aggregate data tables for nonprofit grant spending under the Biden administration. Under Biden, the IRS only published “microdata” files organized by each 501(c)(3) entity, concealing, on aggregate, how much Biden’s government contributed to nonprofits in grants. The IRS website cited “budgetary pressures” for its inability to provide online transparency tools. However, the IRS budget trended upward under Biden, most notably driven by an $80 billion special allocation as part of the Inflation Reduction Act. This lack of transparency raises serious concerns about the administration’s reluctance to disclose how much taxpayer money flows to ideological allies running these organizations.
Even more troubling is how the Biden administration developed creative methods to funnel money to favored groups when direct appropriations were not possible. A prime example is the settlement payment scheme pioneered by Tony West, Vice President Harris’ brother-in-law, during his time as Assistant Attorney General in the Obama years. Third-party settlement payments channeled tens of billions of dollars to progressive organizations, including teachers’ unions and environmental NGOs operated by close political allies.
In lieu of data since 2020, the graph below conservatively assumes that grant spending returned to pre-pandemic levels after the 2020 fiscal year and projects a dashed-line forward at the pre-pandemic slope. This projection predicts $185 billion in grant receipts from nonprofits in 2023.
Beyond total dollars, another government dataset provides insights on total grants awarded. According to the most recent data from USAspending.gov, the federal government issued 44,100 grants through the second quarter of 2024 (the most recent data available) and is on pace to set an all-time record, surpassing the previous high of 70,871 in 2022.
Also worrisome is a dramatic increase in federal grant dollars to states. Block grants — grants from the federal government to state and local authorities — offer a more efficient spending lever than heavy-handed federal interventions in theory, but this is not always the case. Often, ideological capture attaches dangerous strings to grant awards. Even when grants offer discretion, states often acquiesce to ideological requirements in fear of losing federal funds. Today, states, on average, enjoy more revenue from federal grant monies than any individual state tax program.
Many grants also authorize the issuance of microgrants, meaning that award recipients can pass tax dollars onto additional recipients of their choosing. In budget forms, these subrecipients are often bucketed generally as “microgrant recipients,” obfuscating spending and enabling further abuse.
Unchecked growth in grant spending occurs in an environment of little oversight or scrutiny. Unelected executive branch officials are empowered to spend taxpayer dollars on firms of their choosing, often without consistent accountability to elected lawmakers. While much has been written by economists on the kind of fiduciary capture that allies anti-competitive trusts with bureaucrats seeking to advance their careers and line their pockets, only limited literature considers rampant ideological possession of unelected government officials. Famed University of Chicago economist George Stigler argued that government bureaucracy is “acquired and operated by industry”; his wisdom should be modified: the government today is often also acquired and operated by ideology.
Our investigation of federal and state grant programs revealed that at least four ideological pathologies capture tax dollars through grants: the Israel pathology, the gender pathology, the climate catastrophism pathology, and the race pathology.
1) The Israel pathology weaponizes grants to enable and inspire antisemitism. MENAACTION, for example, received $573,000 from the State Department to train Jordanian journalists to identify “fake news.” Yet, the organization instead promulgated fake news, pushing false claims about Israel’s military operations in Gazan hospitals. Domestically, PANA — Partnership for New Americans — received nearly $100,000 to support “Muslim and South Asian legal and illegal immigrant communities” and “prevent the replication of hierarchical power structures.” In 2021, PANA disclosed registered lobbying to the IRS and was involved in leftist get-out-the-vote mobilization during Governor Newsom’s recall battle.
2) The gender pathology is similarly egregious, misusing tax dollars to groom and endanger children. The Center For Innovative Public Health Research — awarded nearly $700,000 by the Department of Health and Human Services (HHS) for “nursing research” — uses taxpayer dollars to conduct a text-messaging program that targets children as young as 14 with “LGB+” information. Also troubling is the University of Nebraska’s $416,000 “health disparities research” grant from HHS, an award offered to coordinate “an online mentoring program” between transgender adults and gender-questioning youth. At the state level, California’s Department of Healthcare Services used crucial State Opioid Response (SOR) funds to “support … Transgender, Queer, Intersex, and questioning youth … ages 11-20.” In short: California tax dollars that should be used to prevent children from overdosing on fentanyl are instead used to groom them, starting at age 11.
3) Third, the climate catastrophism pathology unleashes a massive pipeline of cash upon firms that do very little to address climate and energy problems. Consider the case of the Environmental Health Coalition and San Diego Foundation, which received $22 million from the California Strategic Growth Council for “transformative climate communities.” While the grant’s stated purpose inspires hope, a review of IRS Form 990 (for tax-exempt organizations) reveals expenditures on lobbying and leftist voter mobilization. The Climate Action Campaign similarly used funds that disclosed lobbying advocating for the Green New Deal.
4) Finally, the race pathology offers unaccountable dollars to firms who appear uninterested in resolving racial tensions. The Equality Alliance of San Diego and its Center on Policy Initiatives have used federal, state, and local grants to engage in lobbying and advocacy, which is not allowed under 501(c)(3) rules. This funding has pushed policies including defunding of police. In another case, the National Science Foundation awarded a whopping $1,500,000 STEM grant to the University of Florida to “address anti-black-racism.” Indeed, a large sum that should have been spent to create STEM opportunities for students of all races was instead spent to facilitate divisive trainings and pay DEI bureaucrats.
In addition to ideological capture, Americans should also be worried about waste. Most grant programs require that applicants for federal grant dollars be nonprofits, eliminating competition for contract dollars from for-profit firms. Unfortunately, absent a profit incentive, nonprofit grant recipients are generally less effective and efficient than their for-profit counterparts and suffer from a perverse form of grant dependency. Most egregiously, the Biden administration renewed a federal grant program in support of the California High Speed Rail Authority for a railway intended to connect San Francisco and Los Angeles, awarding an additional $3.1 billion to the project. While the Trump administration suspended federal grants for the railway’s failure to “make reasonable progress,” Biden’s renewal of the fund expands an estimated $88 to $128 billion mountain of waste for an incomplete rail project first announced in 2008.
The primary beneficiaries of expansive and unaccountable grants are grifters and ideologues, while the losers are taxpayers and suffering Americans — including hungry children, citizens enduring dilapidated infrastructure, and underprivileged students, all of whom are groups that abused grants are intended to support.
In addition to DOGE efforts federally, state legislatures and governors should step up by implementing comprehensive oversight of all grant dollars flowing through their states. States can and should require mandatory public disclosure of grant information and detailed quarterly financial reporting from recipients, extending transparency to track all recipients and subrecipients down to the final beneficiary, ensuring that no taxpayer money disappears into the labyrinth of “microgrant” distributions.
To combat grant abuse, policymakers at both federal and state levels must prioritize transparency, accountability, and fairness in the grant appropriation and award processes. Lawmakers should have two primary goals: claw back as many grant dollars as possible and ensure that all future grants serve the public interest.
1. Claw back as many tax dollars as possible from unaccountable grant programs
a. Ensure Grants Have Clear Goals and Metrics
i. Mandate that all grant appropriations include specific, measurable objectives and outcomes. When appropriations are ambiguous, agencies should provide metrics aligned with legislative intent.
ii. Require grant recipients to report progress against these metrics regularly, with clear consequences for noncompliance or failure to meet stated goals.
b. Sunset and Limit Appropriations
i. Introduce sunset clauses for all grant appropriations, mandating expiration of all existing grants. Conduct thorough reviews of all appropriated funds, discontinuing programs that no longer serve their intended purpose or fail to meet performance metrics.
ii. Ensure that grant programs are appropriated specific dollar amounts rather than unspecified quantities with language like “such sums as necessary.”
c. Reevaluate Efficacy of Existing Programs
i. Implement regular evaluations of grant-funded programs to assess their impact and effectiveness.
ii. Establish a framework for discontinuing or restructuring programs that do not achieve their goals or demonstrate a lack of accountability.
2. Ensure that remaining grant programs are fair, transparent, accountable to elected lawmakers, and serve the public interest
a. Ensure Equal Opportunity in Grant Eligibility
i. Implement strict criteria to prevent favoritism toward nonprofits and ideological allies.
ii. Ensure gubernatorial oversight.
b. Prohibit Lobbying and Get-Out-the-Vote Activities
i. Ban the use of grant funds for any lobbying efforts or political campaign activities.
ii. Enforce penalties for organizations that misuse grants for partisan purposes.
c. Mandate Line-Item Transparency
i. Require detailed reporting on the allocation and expenditure of grant funds, broken down by specific line items.
ii. Make all grant-related financial information, including aggregate grant receipts, immediately and publicly accessible online, allowing for independent audits and public scrutiny.
Solzhenitsyn’s warnings about the dangers of ideology-driven governance are increasingly relevant in America today. Every taxpayer should be concerned that tax dollars propel unaccountable and unrepresentative ideological activities through unaccountable grants. By fixing existing money pipelines and clawing back unnecessary spending, lawmakers can restore public trust and ensure that grants serve the public interest rather than ideological agendas.
Joe Lonsdale is an entrepreneur and venture capitalist. Tanner Jones is a policy analyst at the Cicero Institute.
