US judge temporarily blocks Trump's freeze on federal grants and loans

A U.S. judge on Tuesday temporarily halted President Donald Trump's order to freeze hundreds of billions of dollars in federal grants and loans, just minutes before it was set to take effect. Judge Loren AliKhan's pause will last until 5 p.m. ET (10 p.m. GMT) next Monday, in response to a lawsuit filed earlier that day by an organization representing grant recipients.

The lawsuit claimed that the White House's temporary freeze on approved funding was illegal. In the hours leading up to the order's implementation, there was widespread confusion about which agencies and projects would be affected. The acting head of the White House budget office had instructed agencies to "temporarily pause all activities related to obligations or payments of federal financial assistance." This move was purportedly intended to allow the new administration time to assess which grants and loans aligned with its agenda.

White House press secretary Karoline Leavitt stated that Trump's plan to suspend billions of dollars in U.S. government funding was to "responsibly manage taxpayer money." She told reporters at her first press briefing that the pause on grants would allow the government to cut spending on "woke" gender issues and diversity programs. However, this sparked confusion and angered opponents. On Tuesday, institutions receiving federal loans and grants, such as non-profits and research facilities, began facing the reality of rapidly dwindling funds.

Judge AliKhan stated on Tuesday that she was issuing a brief stay to "maintain the status quo" until she could hold oral arguments, which are scheduled for next Monday morning. The White House directive could impact billions of dollars in funding for federal programs, ranging from disaster relief to cancer research. Diane Yentel, president of the National Council of Nonprofits, celebrated the ruling in a post on X. "Our lawsuit worked — a U.S. District Court is blocking the Office of Management and Budget (OMB) from moving forward with its reckless plan to stop federal funding," she wrote. In the lawsuit, her organization wrote that Trump's order was designed to "essentially eliminate all federal grant programs."

The White House stated that Trump's plan to suspend billions of dollars in U.S. government funding was to "responsibly manage taxpayer money." They argued that Trump's order had "no legal basis or rudimentary justification" and would have ripple effects across the United States and beyond. This is separate from a lawsuit filed by a coalition of Democratic states later on Tuesday, who called the order unconstitutional. White House Deputy Chief of Staff Stephen Miller also defended the directive before the judge's ruling, telling reporters it would allow the government to gain "control of credit." He responded to a question about whether the "Meals on Wheels" food delivery program would be affected by saying, "It will not affect any federal programs that Americans depend on."

On Tuesday, several states reported issues accessing funds through Medicaid, a government healthcare program for low-income individuals. The White House later stated that the program would not be affected and that the issue would be resolved shortly. It also stated that Social Security benefits would not be impacted, nor would any programs that "directly provide benefits to individuals," including the Supplemental Nutrition Assistance Program (SNAP), also known as food stamps. In a letter to the White House, top Democrats expressed "extreme alarm" about the plan to suspend funding. Washington Sen. Patty Murray and Connecticut Rep. Rosa DeLauro wrote, "The scope of your order is shocking, unprecedented, and will have devastating consequences across the nation." U.S. Senate Democratic Minority Leader Chuck Schumer said the move would lead to delays in paychecks and rent payments and create "chaos."