It has been widely expected that the installation of the Obama administration and an expanded Democratic majority in both houses of Congress would produce a major shift in federal human embryonic stem cell (hESC) research policy. During the Bush administration, hESC research was among the most controversial of scientific research topics, and the federal government's role in financing hESC research was limited both in scope and scale. Only certain embryonic stem cell "lines" were eligible for federal research support. Federal regulations prohibited the direct or indirect use of federal funds to finance research using other stem cell lines, so that laboratory space or equipment initially purchased with federal funds, for example, could not be used to support research on ineligible stem cell lines. Congressional attempts either to restrict this research further or to significantly expand the scope and scale of federal support were unsuccessful.

In response to this deadlock in Washington, stem cell advocates turned to state political systems-governors, legislatures, and bureaucracies-to continue pursuing their agendas, with varying degrees of success. These efforts have increased the amount of money devoted to hESC research and established infrastructure-laboratory space, training programs, and the like-that was not subject to federal spending restrictions. While both state and private funding have been adversely affected by the recent recession and the sharp decline in the stock market, states and private donors now spend more money than the federal government to support hESC research.

Many observers expected a major break in the Washington gridlock over stem cell research with the new administration. While a break has occurred, its significance is difficult to assess. President Obama has recently fulfilled his campaign promise to overturn executive orders that limited the scope and scale of federal stem cell funding, but he has also left action on other significant stem cell issues to the National Institutes of Health (NIH) and Congress.

This paper examines the current and likely future funding picture for hESC research. It outlines the Bush administration's regulatory and funding policies, inventories current state and private funding for stem cell research, and evaluates the factors likely to shape future stem cell funding. My conclusions are cautionary-while it seems likely that a new administration and Congress may well harvest low-hanging legislative fruit that has already passed Congress by substantial margins, the odds of a major shift in federal stem cell policy, at least in the short run, are low. Many ethical and political issues surrounding stem cell research remain controversial; furthermore, major problems with the national economy, health care, wars in Iraq and Afghanistan, and recent problems in the Middle East seem likely to consume much of the political attention and resources available to both President Obama and Congress. The administration has also committed to positions on other reproductive health issues which may complicate political progress on stem cell questions. The recently enacted economic stimulus package dramatically increases federal spending for biomedical research, but a major increase in stem cell funding seems unlikely. What does seem likely, even if state and private funding for stem cell research decline and federal funding increases, is that most serious policymaking around stem cell research will continue at the state level, rather than relocating to Washington.