President Donald Trump recently called for a freeze on federal spending for loans and grants in a memo issued on Jan. 27 by the Office of Management and Budget. This proposed freeze has alarmed states, schools and organizations that depend on the trillions in funding from Washington, D.C. The freeze could have serious consequences for universities, nonprofits and other groups reliant on federal financial support.
Fortunately, two federal judges blocked the freeze at the end of January. Following this decision, the administration issued a brief two-sentence notice rescinding the original memo on Jan. 29, adding to the confusion surrounding the situation. After the memo was rescinded, a second federal judge issued a block that has since been extended.
The administration clarified that the freeze would not impact federal assistance to individuals — such as Social Security, Medicare, food stamps, student loans or scholarships. Officials stated that the pause was “necessary” to review whether the spending aligns with Trump’s executive orders on issues, like climate change and diversity, equity and inclusion programs.
“The Executive Orders issued by the President on funding reviews remain in full force and effect and will be rigorously implemented by all agencies and departments,” White House Press Secretary Karoline Leavitt stated, placing the blame for the confusion on the courts and news outlets. “This action should effectively end the court case and allow the government to focus on enforcing the President’s orders on controlling federal spending.”
Despite the order being slimmed down, it could have grave implications for millions of Americans who rely on federal assistance. This is a harsh measure that could disproportionately harm vulnerable populations, particularly seniors. The Older Americans Act Nutrition Program, which supports community-based initiatives like Meals on Wheels, could face funding cuts as a result. The freeze could also disrupt funding for the National Low-Income Housing Coalition. There are growing concerns that programs under the Department of Housing and Urban Development might also be impacted by the freeze.
The legal implications of the freeze remain uncertain. If implemented, it would affect millions of Americans, whether individually or through their businesses. Despite the federal judges’ blocks on the order, nonprofits throughout the nation are reporting a lack of funding, forcing layoff.
This order may even be deemed unconstitutional. The Impoundment Control Act of 1974 clearly prohibits presidents from temporarily or permanently withholding enacted funding, and it sets forth procedures for how the president can propose delaying or rescinding funds.
Presidents do not have the authority to selectively ignore parts of laws or determine how much funding that has been signed into law reaches the American people. This reckless act by the president is baffling in its execution and harmful to the country’s most vulnerable.
