Trump freezes federal aid to Americans, triggering fury

The order was issued by the White House budget office in a memo a week into Trump’s second term.

It was not clear in the memo, signed by acting director of the Office of Management and Budget (OMB) Matthew Vaeth, how such a pause on disbursements of funding will work or for how long.

The extraordinary measure follows a similar announcement that US foreign aid is frozen.

Trump won the presidency in part on promises to dismantle large sections of the US government and to slash spending.

However, the aggressive shake-up is also aimed at making sure that federal spending programmes — and government employees — support his right-wing political goals.

A senior Trump administration official told reporters that the funding stoppage was a tool to enforce compliance. Programs that did not conflict with Trump would see their funding continue.

The order instantly sowed fear and confusion among federal grant recipients.

It also sparked accusations from Democrats that the Republican president is violating the constitution by usurping Congress’s power to control the US budget. 

‘Political vandalism?’ 

Federal spending included more than $3 trillion in financial assistance like grants and loans in fiscal year 2024 — all of which was approved by Congress.

The senior official, who spoke on condition of anonymity, said the pause was being enacted in a way that was in line with the law.

However, Democratic Senator Patty Murray called the White House order “a brazen & illegal move.”

“The law is the law — Trump must immediately reverse course, follow the requirements of the law, & ensure the nation’s spending laws are implemented as Congress intended,” she posted on X.

Another senator, Richard Blumenthal, said the “illegal” order will create “havoc” in medical and research facilities, which receive major government funding.

“This is political vandalism. Taking a wrecking ball to federal agencies does nothing to make government more efficient but it is already doing grave damage to people and programs throughout the country,” Senator Chris Van Hollen said on X.

The OMB memo stated that “federal agencies must temporarily pause all activities related to obligation or disbursement of all Federal financial assistance and other relevant agency activities.”

It excluded Social Security and Medicare benefits — used by retirees — from this pause.

Areas that might be impacted, it said, include “financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal” — references to racial equality and climate change programs that Trump has vowed to eradicate.

Vaeth said that financial aid should be “dedicated to advancing Administration priorities”, issues like easing the burden of inflation, unleashing US energy and manufacturing, and “ending ‘wokeness’.”

The Sierra Club, an environmental organization, said the freeze could jeopardise funding for everything from disaster relief to home heating subsidies, safe drinking water programs, and the National Suicide Prevention Hotline.

“In issuing a sweeping halt to federal funding, grants and loans, Donald Trump has... immediately and significantly put Americans in danger,” Sierra Club Executive Director Ben Jealous.