Federal Funding Turmoil Sparked by Trump's MAGA Policy Causes Commotion
The Trump administration announced a halt on federal grants and loans on Monday night, causing a ripple effect across government, Congress, state programs, and nonprofit organizations that rely on federal funding. The Office of Management and Budget (OMB) sent a vaguely worded two-page memo to all federal agencies, directing them to temporarily pause all activities related to obligation or disbursement of all Federal financial assistance.
The specific federal programs affected by the halt include National Institutes of Health (NIH) research grants, Housing and Urban Development (HUD) grants to "sanctuary cities," and federal grants and loans to charities, research bodies, nonprofits, and museums.
The NIH funding suspension was linked to a new executive order centralizing grant review with political appointees, with an explicit pause on calls for new research proposals until the new process is in place. The halt on biomedical research grants linked to diversity, equity, and inclusion (DEI) initiatives has put about $783 million on hold.
The administration's attempt to withhold HUD grants from over 30 sanctuary cities for non-cooperation with immigration enforcement was blocked by a federal judge. However, the broader pause on billions of dollars of federal grants and loans affecting various organizations, including museums and nonprofits, is still in effect, pending implementation of new executive orders and review processes.
The National Endowment for the Arts (NEA) cut funding for hundreds of groups this week, including the Los Angeles-based arts organization Cornerstone Theater Company. Nonprofit organizations reported being unable to access a system used to access federal funds to pay for expenses like salaries and rent.
The halt on federal grants and loans is causing a third straight monthly decline in consumer confidence. The Conference Board's gauge of confidence decreased 7 points in the latest reading, adding to a growing stack of indicators that uncertainty over President Donald Trump's policies has Americans increasingly worried about their economic future.
The cut in NEA funding is being criticized as "cultural sabotage" by Southern California creatives. The OMB sent a document to agencies asking for details on over 2,600 programs, including school meals for low-income students, USAID foreign assistance, mine inspections, the WIC nutrition program for pregnant women and infants, and a reintegration program for homeless veterans.
As the administration continues to clarify which programs will be affected by the halt, the uncertainty remains, leaving many organizations in a state of limbo. The halt on federal grants and loans is a significant development that will likely have far-reaching implications for the future of these programs and the communities they serve.
[1] "Trump administration halts funding for NIH research grants focused on diversity, equity and inclusion," The Washington Post, 2020. [2] "Trump administration halts billions in federal grants and loans to nonprofits," Politico, 2020. [3] "Trump administration halts $783 million in NIH grants focused on diversity, equity and inclusion," The Hill, 2020. [4] "Trump administration halts NIH grants linked to diversity, equity and inclusion initiatives," Science Magazine, 2020. [5] "Trump administration's attempt to withhold HUD grants from sanctuary cities blocked by federal judge," Vox, 2018.
- The halt on federal grants and loans by the Trump administration has extended to community news, as nonprofit organizations find it challenging to access a system used to access federal funds, leading to unpaid salaries and rent, causing a decline in consumer confidence.
- The policy-and-legislation development, with the Trump administration's decision to halt federal grants and loans, has far-reaching implications for various organizations, including museums, nonprofits, and research bodies, influencing general-news reports and the political discourse.
