"create a model of an entire personal computer system that is extremely compact (under 20,000 lines of code) and yet is quite practical enough to serve as a system for succeeding versions of the $100 laptop and for embedded systems of the future"...and revolutionize computers all over again.
Their existing work includes feats like language-to-language translation, automatic generation of low-level blit functions from mathematical descriptions of the desired geometry and graphics, and a tiny TCP/IP stack in a few dozen lines of specialized parser code.
They are also exploring the ability to represent or model the system in itself, and then having it automatically reason about how to allocate resources and choose algorithms to solve problems and run better.
If you really want to blow your mind read their 2007 progress report "STEPS Toward The Reinvention of Programming" (PDF). I've never seen anything like it anywhere else.
It's difficult to explain what they're doing concisely. There's a rich history to the work, and the current research and results are themselves densely woven from heavy deep parts. This is all stuff that rewards your perusal.