Judge Blocks Trump's Federal Funding Freeze

UPDATE Jan 28, 2025 4:50 PM CST

A federal judge blocked President Trump's freeze on federal grants and loans minutes before it was due to take effect Tuesday. US District Judge Loren L. AliKhan, a Biden appointee, issued the temporary stay in response to a complaint filed by groups including the National Council of Nonprofits, Axios reports. The AP reports that the "vaguely worded" directive left many people and organizations struggling to find out what programs would be affected. "It seems like the federal government currently doesn't actually know the full extent of the programs that are going to be subject to the pause," AliKhan said. The stay will expire Monday afternoon.

Jan 28, 2025 6:12 AM CST

The latest directive from the Trump administration is potentially huge in scope: The White House is freezing all grants and loans distributed by the federal government to make sure they comply with the president's newly issued executive orders and broader agenda, reports the Hill. The directive goes into effect at 5pm Tuesday.

• The scope: The New York Times spells out the potential impact: "The directive threatened to upend funds that course throughout the American economy: Hundreds of billions of dollars in grants to state, local and tribal governments. Disaster relief aid. Education and transportation funding. Loans to small businesses."

• The order: A two-page memo from Matthew J. Vaeth, head of the Office of Management and Budget, orders agencies to pause "all activities related to obligation or disbursement of all Federal financial assistance," adding that this "temporary pause will provide the Administration time to review agency programs and determine the best uses of the funding for those programs consistent with the law and the President's priorities."
• Ideology: Vaeth declares that "the use of Federal resources to advance Marxist equity, transgenderism, and green new deal social engineering policies is a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve." The memo singles out programs for DEI (diversity, equity, and inclusion) and "woke gender ideology." It exempts money for Medicare and Social Security, as well as "assistance provided directly to individuals," without elaboration on the latter.
• Confusion: The immediate reaction from those on the receiving end of such money is "widespread confusion," per Politico. The Washington Post similarly finds "significant confusion across Washington." Donald Kettl, former dean of the University of Maryland School of Public Policy who has worked as a consultant for numerous federal agencies, puts it this way: "In two pages, we've got what amounts to 60 years of tradition and policies that are thrown up in the air."
• Challenge: The move is likely to be challenged legally, with a key question centering on whether the president can stop funding already allocated by Congress, per the Times. Senate Democratic leader Charles Schumer said the memo "blatantly disobeys the law." Politico sees the move as Trump "shifting control of the federal purse strings further away from members of Congress."

(More President Trump stories.)