I think this is completely unrelated.

This administration thinks science is 'woke' because it says things that disagree with him. Many of these funding cuts were explicitly politically motivated, e.g. they specifically targeted research about diversity, gender, or vaccines.

It's not about AI, it's about removing funding from liberal causes and giving it to conservative causes.

Unfortunately it is entirely related. The initial wave of cancelations were about those topics, but the more structural thing they are attempting now is to focus funds on tool development for AI models as opposed to human capital development as NSF does.

No it is about AI too. Trump et al want there to be no dispensing of federal grants to academics in the future. They want the government to instead cut checks directly to xAI et al who will do all our research for us in the future and will for certain represent our best interests and not those of shareholders exclusively.