California state universities have quite the decision to make under President Donald Trump's administration, and California Gov. Gavin Newsom is not happy about it.

According to JustTheNews, Gov. Newsom is not happy about the “Compact for Academic Excellence in Higher Education” proposal from the Trump administration, which was aimed at making deals with state universities in exchange for special access to federal funding. 

In response to Trump's proposal, Newsom has threatened to withhold state funding from state universities if they choose to agree to Trump's proposal, which would include conditions like not raising tuition, eliminating DEI nonsense and stopping race-based admissions.

Those universities have a choice of whether to stay on Newsom's side and have access to state funding, or accept Trump's proposal and be eligible for significant federal funding.

What's going on?

Gov. Newsom warned the state schools at the Alexander Science Center School in Los Angeles during a conference this week, threatening to withhold "billions" in state funding.

"If any California University signs this radical agreement, they’ll lose billions in state funding — including Cal Grants — instantly," Newsom said in a press release.

He added, "California will not bankroll schools that sell out their students, professors, researchers, and surrender academic freedom."

The governor's office laid out the reasons it believes why state schools should not sign Trump's proposal, warning that it would "erase diversity."

Erasing diversity?

"It would impose strict government-mandated definitions of academic terms, erase diversity, and rip control away from campus leaders to install government-mandated conservative ideology in its place," Newsom’s office said in a statement.

It added, "It even dictates how schools must spend their own endowments. Any institution that resists could be hit with crushing fines or stripped of federal research funding."

JustTheNews noted:

This proposal is “nothing short of a hostile takeover of America’s universities,” Newsom’s office stated.

The compact states that the universities are not required to sign the document, but would lose federal grants if they didn't.

Social media reacts

Users across social media weighed in on Newsom's threat to withhold state funds.

Gavin Newsom has lost the plot. He's threatening to defund California universities if they sign up to a new 'Compact' that FREEZES tuition, requires FAIRNESS in admissions and PROTECTS free speech.

Now Newsom is against all that, just to 'stick it to Trump'? How pathetic. pic.twitter.com/IOMuLHCClN

— steve hilton (@SteveHiltonx) October 3, 2025

"It’s crazy that whatever Trump suggests, they scramble to do the opposite," one X user wrote.