Without the university infrastructure around these Labs they'd EACH have to each employ their own construction, maintenance, housekeeping, legal, bookkeeping, HR, IT, compliance (and more) staff.

There will still be some research done if the cuts to the indirects survive the courts but it will be drastically reduced in scope as the labs staff will have to cover any functions no longer provided by the host university.

And you probably know this but this money isn't getting stuffed in to university presidents pockets or anything. It's paying (some) of the salaries of ordinary people working at jobs that pay about 20% (or more) less than they'd make in the private sector.