Back in the distant past, younguns, the US was involved in a struggle with the Soviet Union that many felt was an existential threat to our continuation on this planet. Among other features, this Cold War (perhaps better termed Ongoing Proxy War) featured the buildup of ecosphere destroying megaweapon bombs.
The fuzzy blankie we used to keep from going insane was the thought that since both sides could destroy huge amounts of the other side's population, render much of its territory uninhabitable, and could do so should the other side move first, we were safe.
Since we were mutually assured to destroy each other, the logic of starting some serious beef was an insane one. Nobody in their right mind would actually do such a thing. So this kept certain behaviors (like the hilariously NewSpeak "pre-emptive counter-strike" with nuclear weapons) off the table.
In discussions of NIH Grant review, there is often a certain paranoia voiced that members of the review panel use this position of tremendous power to screw over their scientific rivals. Sounds plausible, does it not? After all, this grant stuff is a zero-sum game and the "peers" of peer review are after the same pool of money that each applicant is eying. These days it is a good bet that the reviewer has her own application under review elsewhere in the CSR...or has one pending funding in this self-same Fiscal Year.
That's before we get to scientific competition to publish papers in some research area first. We all know that first is best and all others might as well go home, right? And any rational grant funding agency (don't laugh) like the NIH should diversify their portfolio such that if they fund grant on a topic, the chances of another one on nearly the same topic should be lesser.
Naturally, the closer the reviewer expertise is to the grant in question, the closer this reviewer is to being in direct conflict of interest at some level.
My first approach to comforting the distraught Assistant Professor is to emphasize that our peers are professionals, with some degree of ethical centeredness who are for the most part attempting to do the job as asked.
This doesn't comfort everyone. So today I offer the Mutually Assured Destruction theory for your consideration.
One of the most surprising things I found about study section service is the rapidity and surety with which payback opportunity was provided. During the early days of my study section service it was the appearance of many grants in my piles to review that were submitted by PIs who had previously appeared on study section panels reviewing my own proposals. After I'd been reviewing for a little bit, it was remarkable how quickly people who's grants had appeared in study sections that I was on (and in some cases apps to which I had been assigned) were now in a position on panels reviewing other grants of mine.
I came away from all of this with the understanding that what goes around comes around VERY quickly in NIH grant review.
So for the paranoid types...do consider this additional source of pressure on the reviewer. If you don't trust their professionalism, trust in their self-interest. This Mutual Assurance tends to suggest that reviewers would be crazy to screw with applicants out of pure self-interested bias.