KEY TAKEAWAYS
- The White House has retracted a previous order that paused some grants, loans, and assistance the federal government awards to nonprofits and states.
- The prior order was supposed to take effect at 5 p.m. Tuesday, but it created massive confusion among federal agencies as it did not specify which federal payments would be affected.
- Congressional leaders and legal experts said the order was against the law and a breach of power. A federal judge temporarily blocked the order minutes before it took effect on Tuesday.
The Trump administration has rescinded his previous order to freeze trillions of dollars of grants and loans.
The White House Office of Management and Budget retracted its order from Monday in a memo sent out Wednesday, according to documents obtained by NBC News.
The original order sent out late Monday was supposed to take effect at 5 p.m. Tuesday and directed federal agencies to pause some of the $3 trillion in grants, loans, and assistance the federal government awards each year.
The memo directed agencies to stop federal funding so they could align their spending with Trump’s policy priorities, including “ending ‘wokeness'” and stopping “Marxist equity, transgenderism, and green new deal social engineering policies,” The New York Times reported.
However, the order led to massive confusion among federal agencies as it did not specify which federal payments could continue besides “assistance provided directly to individuals,” Social Security and Medicare. It was unclear if the order would disrupt national non-profit programs and some federal student loan and grant types.
The order also sparked criticism from Congressional leaders and legal experts, who said it was against the law and a breach of power.
The White House attempted to clarify its order Tuesday and argued it did not violate any law because the pause was temporary. However, by the end of the day, the order led to lawsuits by several nonprofits and Democratic states.
A federal judge temporarily blocked the order minutes before it took effect on Tuesday.