The Trump administration panicked shoppers and despatched shockwaves by means of authorities companies when it despatched a memo Monday evening calling for a funding freeze to enter impact at 5 p.m. Tuesday, doubtlessly pausing a broad vary of grant, mortgage and help applications that will battle with the brand new president’s priorities.
However then, proper earlier than the deadline, a federal decide quickly blocked the federal funding freeze after an emergency listening to.
Beforehand, the White Home had instructed company heads to quickly pause spending in areas together with “monetary help for international help, nongovernmental organizations, DEI, woke gender ideology and the inexperienced new deal,” in keeping with the memo from Matthew Vaeth, performing director on the Workplace of Administration and Finances (OMB).
Lawmakers, authorities officers, states and different stakeholders are nonetheless searching for solutions about what this directive really means. The memo famous that the federal government spent greater than $3 trillion in federal monetary help in fiscal yr 2024, but it surely’s unclear how a lot of this spending might be paused on account of President Donald Trump’s newest motion.
Including to the confusion: Among the issues that Trump is focusing on aren’t even legal guidelines. For instance, the Inexperienced New Deal was a sweeping local weather decision first launched by Rep. Alexandria Ocasio-Cortez, D-N.Y., in 2019 that has not been handed. It is doable the OMB memo is referring to local weather actions that have been included within the Inflation Discount Act, which Congress handed in 2022, although it is not clear.
What’s impacted by Trump’s federal funding freeze?
The scenario is altering quickly, however talking broadly, the memo’s give attention to DEI (range, fairness and inclusion), international help and different considerations of the brand new administration offered some hints about what might be paused.
In a information convention Tuesday morning, Senate Minority Chief Chuck Schumer, D-N.Y., mentioned the memo “has shut off billions, maybe trillions of {dollars} that immediately help states, cities, cities, faculties, hospitals, small companies and most of all, American households.” He went on so as to add that “funds for issues like catastrophe help, native regulation enforcement, rural hospitals, help to the aged, meals for individuals in want — all are on the chopping block on this new administration.”
On Tuesday, the Meals on Wheels nonprofit mentioned it feared that funding might be affected by the freeze. Meals on Wheels is a meals help program geared toward older People.
“The uncertainty proper now could be creating chaos for native Meals on Wheels suppliers not figuring out whether or not they need to be serving meals immediately,” Jenny Younger, a spokeswoman for Meals on Wheels America, advised HuffPost. “Which sadly means seniors will panic not figuring out the place their subsequent meals will come from.”
Democrats additionally raised alarm later within the afternoon about impacts to Medicaid, a program that gives medical health insurance for low-income People.
Sen. Ron Wyden, D-Ore., wrote on X that “Medicaid portals are down in all 50 states following final evening’s federal funding freeze,” referring to the digital techniques utilized by well being care suppliers to handle Medicaid funds. Throughout a press briefing Tuesday afternoon, White Home Press Secretary Karoline Leavitt was unable to say how the memo could have an effect on Medicaid.
“The White Home is conscious of the Medicaid web site portal outage. We’ve got confirmed no funds have been affected — they’re nonetheless being processed and despatched,” Leavitt later posted on X. “We anticipate the portal shall be again on-line shortly.”
What is not impacted by Trump’s federal funding freeze?
The preliminary OMB memo explicitly confirmed that Social Safety and Medicare is not going to be affected by the freeze.
Leavitt added throughout Tuesday’s briefing that the Supplemental Diet Help Program (SNAP), aka meals stamps, and different welfare advantages is not going to be impacted.
“This isn’t a blanket pause on federal help and grant applications,” she mentioned. “Help that’s going on to people is not going to be impacted by this pause.”
So far as scholar loans, after some preliminary confusion, the Division of Training confirmed that federal Pell Grants and direct loans is not going to be impacted, in keeping with a number of reviews.
How lengthy will the funding pause final?
A Q&A doc from the OMB famous that it’s working with companies to rapidly approve sure applications and mentioned “a pause might be as quick as a day.”
Leavitt mentioned in the course of the press briefing that “it’s a momentary pause” whereas the administration is “reviewing the federal funding that has been going out the door.”
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