Democrat Gov. Gavin Newsom has escalated his war with President Donald Trump this week, vowing to strip billions in state funding from any California university that agrees to Trump’s new Compact for Academic Excellence in Higher Education.
The Trump administration rolled out the 10-page compact to nine elite universities, including the University of Southern California.
However, the college is the only California institution on the list.
The plan seeks to restore traditional academic standards by eliminating DEI mandates, banning race-based admissions and hiring, reinstating standardized tests like the SAT, capping international student enrollment, and ensuring free speech protections for conservative students.
In exchange, universities that sign on would receive preferential access to federal grants, higher overhead payments, and priority treatment in civil rights investigations.
Newsom, in a rage-filled all-caps statement, threatened to punish any institution that participates:
“IF ANY CALIFORNIA UNIVERSITY SIGNS THIS RADICAL AGREEMENT, THEY’LL LOSE BILLIONS IN STATE FUNDING — INCLUDING CAL GRANTS — INSTANTLY.
“CALIFORNIA WILL NOT BANKROLL SCHOOLS THAT SELL OUT THEIR STUDENTS, PROFESSORS, RESEARCHERS, AND SURRENDER ACADEMIC FREEDOM.”
IF ANY CALIFORNIA UNIVERSITY SIGNS THIS RADICAL AGREEMENT, THEY'LL LOSE BILLIONS IN STATE FUNDING — INCLUDING CAL GRANTS — INSTANTLY.
CALIFORNIA WILL NOT BANKROLL SCHOOLS THAT SELL OUT THEIR STUDENTS, PROFESSORS, RESEARCHERS, AND SURRENDER ACADEMIC FREEDOM. pic.twitter.com/iZhln3rfBM
— Governor Gavin Newsom (@CAgovernor) October 2, 2025
Last year alone, USC received $28.4 million in Cal Grants, while private institutions statewide took in $227.6 million.
Public colleges, including the University of California and California State University systems, received $2.2 billion.
Newsom’s threat could wipe it all away.
The compact has rattled higher-ed’s ruling class.
Ted Mitchell, president of the American Council on Education, derided it as a “Faustian bargain.”
Former Obama Treasury Secretary Larry Summers complained it was like “fixing a watch with a hammer.”
But White House officials dismissed the hysteria.
“Our hope is that a lot of schools see that this is highly reasonable,” adviser May Mailman said.
The compact also requires colleges to uphold women’s sports by recognizing biological sex in athletics, a direct rebuke to California’s radical gender policies.
White House spokeswoman Abigail Jackson blasted Newsom’s threats as political theater:
“Gavin Newscum should worry about the disaster he’s created in his own state.”
She added that Democrats opposing the compact are effectively opposing “efforts to cap wild tuition hikes and protect free speech.”
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