President Donald Trump’s administration rescinded its directive to freeze federal grants and loans on Wednesday, backtracking just one day after the order was issued.
The freeze, issued on Jan. 27 and initially set to go into effect the following afternoon, aimed to temporarily pause federal loans, grants and other financial assistance programs across multiple agencies. The freeze also caused Medicaid portals to go down in all 50 states, temporarily preventing hospitals and doctors from receiving payments.
The move sparked immediate backlash from lawmakers, public health experts and nonprofit organizations.
Democratic leaders swiftly condemned the decision, with Senate Minority Leader Chuck Schumer warning that it would lead to “chaos for communities and missed payrolls and rent payments,” according to a statement released on Jan. 27.
Sen. Ron Wyden went further, calling it a “blatant attempt to rip away health care from millions of Americans overnight” and warning that “it will get people killed.”
The pause had the potential to impact trillions of dollars in federal grants and loans, raising concerns about funding for housing assistance, small businesses and disaster relief programs.
Despite the criticism, the White House Budget Office defended the funding pause, arguing that it was meant to allow a review of agency programs to ensure they aligned with the administration’s priorities.
However, the uncertainty surrounding the freeze led to confusion among federal agencies and recipients of government aid.
Howard, where 41 percent of students rely on federal aid according to The Hilltop, assured students that they were working with federal agencies to seek clarification via email sent on Jan. 28.
Similarly, the U.S. Department of Veterans Affairs Education Service confirmed that GI Bill payments were not impacted and would continue without disruption.
A lawsuit was filed on Tuesday by a group of nonprofit organizations, public health professionals and small businesses represented by Democracy Forward, arguing that the administration’s order exceeded executive authority and posed an immediate threat to essential services.
In response, U.S. District Judge Loren L. Alikhan issued an administrative stay on Tuesday afternoon, pausing the freeze until at least Monday.
Rep. Alexandria Ocasio-Cortez (D-N.Y.), made a statement on “X” calling Judge Loren Alikhan’s decision as, “Trump’s first major loss.”
While Republican senators confirmed the memo was rescinded, the White House made conflicting statements, saying the pause isn’t rescinded—just postponed—according to CNN.
The pause and messaging inconsistencies leave critical programs that leave essential programs to millions of Americans hanging in the balance.
Copy edited by Aniyah Genama
