What are they saying?
The fundamental principle of a university is to share information. Publish it!
If the military fund a university project, then they get to attach strings, that might include restrictions on publishing. University decision: accept strings or walk away. OK so far in principle.
But this story reads as if the military want to extend powers beyond that. Censor work over and above that where strings have been attached and accepted. Stand between universities and that fundamental goal of publication.
Really?