Trump administration puts temporary freeze on federal grants, loans

Acting Director of the Office of Management and Budget Matthew Vaeth on Monday said the Trump administration would suspend all federal financial assistance programs beginning Tuesday at 5 p.m. Eastern time. According to the administration, the pause will allow officials to review agency programs and determine how best to use funds in alignment with Trump’s priorities. Agencies have until Feb. 10 to submit reports about any programs or projects affected by the freeze.

What programs are included in the action? Vaeth said the federal government spent nearly $10 trillion in fiscal year 2024, though the U.S. Treasury Department estimates the total was $6.75 trillion. Vaeth also said $3 trillion was spent on financial assistance. Programs related to foreign aid, nongovernmental organizations, gender ideology, diversity, and the so-called Green New Deal are included in the pause, according to the memo. Vaeth said financial assistance should be used to strengthen America, eliminate financial burdens caused by inflation, promote government efficiency, and other administration priorities.

Grants that have been awarded but not spent are included in the suspension. Social Security, Medicare benefits, and direct individual assistance will not be paused, Vaeth wrote.

How have other lawmakers responded to the pause? Sen. Patty Murray, D-Wash., and Rep. Rosa DeLauro, D-Conn., on Monday wrote a letter to Vaeth calling the scope of the action unprecedented. They said such a pause could have devastating consequences across the country. Meanwhile, Senate Minority Leader Chuck Schumer, D-N.Y. criticized the move saying it could affect universities, disaster assistance, and local law enforcement.

Dig deeper: Read Jordan J. Ballor’s opinion piece about why Trump’s effort to cut waste and fraud will barely scratch the surface of needed reform.