Donald Trump to pause all federal grants and loans, memo reveals

The White House is pausing federal grants and loans following a comprehensive ideological review of its spending initiated by President Donald Trump's administration. A circulated memo has temporarily halted grant, loan, and other financial assistance programs from the Office of Management and Budget (OMB). This action aligns with executive orders signed since President Trump took office, including those aimed at dismantling programs related to diversity, equity, and inclusion (DEI).

Acting Director of the Office of Management and Budget, Matthew J. Was, wrote in the memo: "During this period, to the extent permitted by applicable law, Federal agencies must temporarily pause all activities related to the obligation or expenditure of Federal financial assistance, and other related agency activities that may be affected by the Executive Orders." He further added, "The use of federal resources to advance Marxist equity, transgenderism, and Green New Deal social engineering policies is a waste of taxpayer funds and does not improve the daily lives of the people we serve."

According to the memo, the pause began at 5 p.m. EST on January 28 (8 a.m. AEDT on January 29). The memo has drawn criticism from congressional Democrats, who responded to reports of the memo by sending a letter demanding the OMB rescind its decision. Democratic Senators Patty Murray and Democratic Representative Rosa DeLauro wrote: "The scope of your order is shocking, unprecedented, and will have devastating consequences across the country. We write today to urge you, in the strongest possible terms, to uphold the law and the Constitution and ensure that all federal resources are delivered as required by law."

The memo states that federal agencies must submit detailed information by February 10 regarding any programs, projects, or activities affected by the pause. The pause will allow the administration time to review agency programs and determine how best to use their funding in accordance with the law and President Trump's priorities. The memo also noted that agencies must identify the legal authorization or deadlines for assistance programs before completing their analysis. According to the memo, Medicare and Social Security benefits will not be affected.

Mr. Was instructed federal agencies to halt all activities related to open funding opportunity announcements. "This memorandum requires Federal agencies to identify and review all Federal financial assistance programs and support activities, consistent with the President’s policies and requirements," he wrote. This series of actions indicates a comprehensive review of federal spending by the administration to ensure it aligns with the President's policy objectives.