The White House Office of Management and Budget rescinded its directive freezing federal grants on Wednesday, less than two days after the move sparked widespread confusion, legal challenges, and uncertainty for states, schools, and organizations relying on federal funding.
The original memo, issued Monday evening, left officials scrambling to determine which programs would be affected. The abrupt freeze threatened to disrupt critical services, from education and public health to social assistance programs. Amid mounting pressure, the White House confirmed Wednesday that the directive had been withdrawn, though executive orders related to federal spending in areas like diversity, climate change, and reproductive rights remain in effect.
Confusion and Lawsuits Prompt Reversal
The initial funding pause was set to take effect at 5 p.m. Tuesday but was temporarily blocked by a federal judge following an emergency hearing requested by nonprofit groups dependent on federal grants. Additionally, Democratic attorneys general filed a lawsuit challenging the order.
Administration officials had argued that the freeze was necessary to review spending compliance with Trump’s recent executive orders. Federal agencies had been instructed to answer a series of yes-or-no questions by February 7, including whether programs promoted gender ideology or abortion-related services. However, the vague wording of the memo and the administration’s inconsistent explanations fueled uncertainty and concern.
White House Defends Executive Orders
Despite the memo’s retraction, White House Press Secretary Karoline Leavitt emphasized that Trump’s executive orders on federal spending reviews remain in place and will be enforced across agencies.
“The Executive Orders issued by the President on funding reviews remain in full force and effect and will be rigorously implemented by all agencies and departments,” Leavitt said, blaming confusion on the courts and media rather than the administration.
Nationwide Impact and Reaction
Even before the funding freeze took effect, its impact was being felt across the country. Organizations such as Meals on Wheels, which provides food to seniors, and Head Start, which supports early childhood education in low-income communities, feared disruptions in funding.
While administration officials later clarified that essential services like Medicare, Social Security, student loans, and food stamps would not be affected, they struggled to provide clear answers on Medicaid, initially leaving its status uncertain.
Democratic lawmakers swiftly condemned the freeze, calling the reversal a win for the American people.
“This is an important victory for the American people whose voices were heard after massive pressure from every corner of this country—real people made a difference by speaking out,” said Sen. Patty Murray, D-Wash. “Still, the Trump administration—through a combination of sheer incompetence, cruel intentions, and a willful disregard of the law—caused real harm and chaos for millions over the span of the last 48 hours.”
Senate Democratic leader Chuck Schumer echoed the sentiment, stating, “Americans fought back and Donald Trump backed off.”
While the immediate crisis has been averted, the administration’s broader efforts to reshape federal spending remain in motion, with additional legal battles and policy shifts likely in the months ahead.