The White House has announced it is reversing a memo that had authorized a freeze on federal grants and loans, a move that caused widespread panic among many people who depend on government assistance. This decision follows a judge’s temporary halt to the freeze on Tuesday, only hours after President Donald Trump signed the order and the memo was released by the Office of Management and Budget (OMB).
Legal Challenges and Public Backlash
The judge’s ruling stopped the freeze until Monday. After a lawsuit was filed by a group of organizations representing grant recipients. A new memo was issued on Wednesday, stating that “OMB Memorandum M-25-13 is rescinded.” It is not yet clear why this change in direction took place. In a statement, White House Press Secretary Karoline Leavitt explained that the administration was still working on implementing a freeze but clarified that this memo cancellation only affects the OMB memo and does not cancel the broader freeze on federal funding.
Clarification from the White House
“This is NOT a cancellation of the freeze on federal funding. It is just a cancellation of the OMB memo,” she said. “Why? To resolve any confusion caused by the court’s injunction. The President’s executive orders on federal funding remain active and will be enforced strictly.” The BBC has reached out to the White House to get further clarification about how the administration plans to proceed, especially in light of both the reversal of the memo and the court’s ruling.
Initial Freeze and Resulting Confusion
Earlier in the week, the acting head of the White House budget office had directed federal agencies to “temporarily pause all activities related to the disbursement of federal funds.” This was meant to allow the new administration to review which grants and loans aligned with their priorities. However, the freeze led to significant confusion over which government programs and agencies would be impacted. At one point, an online portal for accessing federal funds was temporarily taken offline and advocacy groups raised alarms about a possible suspension of vital services.
Political Reactions
In response, Senate Democrats quickly shifted a scheduled news conference from discussing Trump’s position on birthright citizenship to criticizing the funding freeze decision. “What they’re doing is unlawful hurting families while helping their wealthy friends,” Senate Democratic Minority Leader Chuck Schumer told reporters after the memo was rescinded. He also warned that Republicans would continue attempting to block future funding but would be stopped this time due to a public outcry. “I don’t think this would’ve happened if it weren’t for the backlash across the country. We’re working with our constituents to make sure their voices are heard. We’ll keep fighting,” Schumer added. He also called on Trump to retract his nominee to head the OMB.
Other Executive Orders and Proposed Program for Federal Workers
This order was just one of several Trump has issued with the aim of reducing the size of government and cutting federal spending. Other executive orders from his administration have targeted issues like transgender rights and birthright citizenship for children born in the U.S. On Tuesday, the Trump administration also proposed a program that would allow federal workers to resign and still receive pay for up to eight months, as part of efforts to downsize the federal workforce. Leavitt had previously mentioned that halting funding would give state governments a chance to cut back on spending for what she referred to as “woke” gender and diversity initiatives. Some states had reported difficulties accessing funds from Medicaid, the government health program for low-income people. The White House later reassured the public that Medicaid would not be impacted by the freeze.
Assurance on Social Security and Medicaid
The White House also stated that Social Security benefits would remain unaffected as would any program that provides direct assistance to individuals such as the Supplemental Nutrition Assistance Program (SNAP), also known as food stamps. Although the funding freeze is currently blocked, the White House believes the original memo achieved its goal by getting federal agencies to start following the President’s executive order.
Reaction from Nonprofits
“We are pleased that the memo has been reversed. The chaos and confusion caused by yesterday’s uncertainty and lack of proper notice should never have occurred,” said Diane Yentel, president of the National Council of Nonprofits one of the groups that filed the lawsuit against the White House. “Nonprofits around the country and the people they serve can now breathe easier knowing that, at least for now, the White House has backed off from its reckless and harmful plan to halt all federal funding for crucial programs, including those supporting homelessness, housing, disaster relief, rape crisis centers, and suicide prevention,” she added. In an earlier press briefing, Yentel explained that the order, if carried out would have severely harmed essential programs like food and housing assistance for military veterans, shelters for domestic violence survivors, and childcare services.
