In a sweeping and unprecedented attempt to seize power reserved for Congress, President Donald Trump's budget office on Monday directed government agencies to freeze all grants and loans for a wide range of programs that could include domestic infrastructure projects, health care programs, housing assistance and a host of other initiatives that depend on money authorized by lawmakers. The order was issued in a leaked two-page memo first obtained by Marisa Kabas, an independent journalist.
Matthew Vaeth, Trump’s acting head of the Office of Management and Budget (OMB), wrote that the pause, which will take effect on Tuesday evening, is being imposed to ensure that the government is complying with Trump's policy agenda and will not affect Social Security, Medicare or "assistance provided directly to individuals." Possible exceptions will be reviewed and granted on a "case-by-case basis." Agencies have a Feb. 10 deadline to submit appeals on any program targeted for suspension.
The memo by Vaeth lays the groundwork for Trump's nominee for OMB chief, Russell Vought — who is awaiting confirmation by the Senate — to implement deep cuts detailed in Project 2025, a right-wing policy blueprint he played a key role in assembling.
Despite the memo's stated instructions to implement the pause “to the extent permissible under applicable law," critics pointed out that almost everything the memo instructs is an illegal abuse of presidential authority: The U.S. Constitution gives Congress the power to determine federal budgets through legislation, while the president administers its disbursement. Because of the memo's broad latitude, Democrats, political activists and nonprofit leaders fear that almost anything that provides essential aid to low-income and struggling Americans without falling under the administration's definition of "direct" assistance could be suspended indefinitely.
The memo was issued after spending freezes were announced at the National Institutes of Health, resulting in a suspension of new research grants and spurring chaos at major scientific institutions.
Senate Majority Leader Chuck Schumer, D-N.Y., condemned the effort in a statement as a "blatant" and "unprecedented" power grab that will hold up "virtually all vital funds that support programs in every community across the country.”
“They say this is only temporary, but no one should believe that,” he said. “Donald Trump must direct his Administration to reverse course immediately and the taxpayers’ money should be distributed to the people. Congress approved these investments and they are not optional; they are the law.” Later Tuesday morning, he told reporters that a group of state attorneys general are going to challenge the order in court.
Other Democrats are raising questions over what exactly will be cut. "Are you stopping NIH cancer trials?” Sen. Amy Klobuchar, D-Minn., asked on social media.
The memo, while light on most administrative details, broadly attacks "Marxist equity, transgenderism, and Green New Deal social engineering policies" that are a "waste of taxpayer dollars," singling out infrastructure and clean energy projects, foreign aid, funding for nonprofits and diversity-related programs for permanent elimination. Trump has already issued orders to halt government operations like health agency meetings and foreign aid and signaled his intentions to target federal disaster relief.
While Vaeth claims that the federal government spent nearly $10 trillion in fiscal year 2024, the source of those figures is not clear; the nonpartisan Congressional Budget Office (CBO) estimated government spending in 2024 at a much lower $6.75 trillion.
"This order is a potential five-alarm fire for nonprofit organizations and the people and communities they serve," Diane Yentel, CEO of the National Council of Nonprofits, said in a statement. "From pausing research on cures for childhood cancer to halting food assistance, safety from domestic violence, and closing suicide hotlines, the impact of even a short pause in funding could be devastating and cost lives."
Officials from states that have received federal money warned that a sudden freeze of unspecified duration will cause enormous social and economic disruption for their constituents.
"Whether it's [Hurricane Helene] recovery in Southwest... semiconductor manufacturing in Northern Virginia... pharmaceutical jobs in Richmond... renewable energy in coastal Virginia... or the Microporous expansion in Southside – every one of these projects is in part the result of federal funding from laws we fought tooth and nail to pass in Congress, and could now be endangered thanks to President Trump's mess," Virginia Democratic Sens. Mark Warner and Tim Kaine, said in a joint statement.
Republicans, on the other hand, characterized the order as Trump fulfilling his campaign promises, even though he repeatedly disavowed Project 2025 only to now embrace many ideas it proposed.
"You need to understand he was elected to shake up the status quo. That is what he's going to do. It's not going to be business as usual," House Majority Whip Tom Emmer, R-Minn., told reporters at a GOP policy retreat in Miami. He did not comment on the potential fate of $6.5 million in federal funding he requested for infrastructure projects in his district last year.
