[ModernMech]

I'll give a real example.

In my department we have research staff to look at research proposals and make sure they're good before they're submitted to the grant agency.

Someone might look at the budget and say "This is administrative bloat because it is not teaching focused so we are cutting them."

What's the downstream effect? Well now those professors who relied on the research staff have to take time out of their schedules to do deeper reviews of their work, so they reduce teaching time and increase research time.

They are not as skilled as the dedicated staff, so now there are fewer proposals being accepted. This means less money to the university, and particularly the department.

So what does the department do? They stop hiring undergraduate graders and they institute a hiring freeze. Now that means they cannot admit as many students, teaching costs go up, class sizes go up. And for the admitted students, now they've lost their work study, so it means fewer students are going to enroll because their aid has decreased, effectively increasing tuition. This can be a vicious downward spiral if not checked.

So the original intent of "tighten belts and reduce waste" is really "we made everything worse for everyone"

[dpe82]

Thinking about it as a system:

If every university were subject to similar constraints, the average "quality" of research proposals would go down (everybody would have less time to spend on it) but since the pool of research dollars is assumed constant everyone would still get roughly their same slice - just with less overhead.

[ModernMech]

How it would actually work is only the best schools would keep their funding while lower tier schools would be shut out entirely and be forced to severely reduce their research agendas. There's a school near me that just went from College to University status because they grew their graduate program enough, they would probably not weather the storm the same as MIT.

[nostrademons]

On a system's level, that's probably the desired outcome in a world where total science funding is shrinking and fewer people can be employed as scientists.

In your example, I'd be more worried about the case where the specialized design reviewer knows what the available sources of grants are and procedure to apply to them, and the professor has since forgotten that knowledge, and so the department now cannot bring in any grants or revenue. That'd kill science even at established institutions like MIT or Yale or Harvard, even if they have very good researchers.