Scientific Activist documents the sharp decrease in the number of grants approved by the NIH. Even as the number of applications went up from 8,957 in 1999 to 10,605 in 2005, the number of grants approved went down from 1,761 to 970; the level of funding went from $456 million a year up to $510 in 2002 and then crashed to $351 in 2005.
Only about three weeks ago, evolution disappeared from the list of approved majors for federal college education grants.
Americans are less prone to believe in evolution than people in any of dozens of first- and second-world countries surveyed except Turkey.
Abstract Nonsense 
Of particular interest is the discussion of this issue on Oracs’ blog because he is directly affected. He currently has a 5 year grant which has been cut every year.
There is a further update on reductions of funding at NIH ar Oracs’ blog
http://scienceblogs.com/insolence/2006/09/more_on_the_declining_funding_of_r01_gra.php#more