(Up to date on 01/28/2025 @ 2:45 p.m.: Trump’s memo is not going to have an effect on monetary assist for school college students)
President Donald J. Trump is pulling out all of the stops to make sure his White Home is working precisely as he desires it. A wave of Trump govt orders final week concentrating on DEI, immigration, and different urgent considerations, raised eyebrows and drew heavy criticism throughout the nation. And solely in his second week, the president is taking yet one more controversial stance.
The White Home funds workplace despatched a memo formally pausing all federal grants and loans. The order comes immediately from Trump as he goals to “establish and overview all Federal monetary help packages and supporting actions in keeping with the President’s insurance policies and necessities,” based on the memo obtained by CBS Information.
When Will it Take Impact?
By 5 p.m. at present (Jan. 28), all monetary help shall be suspended, based on CBS. With that, billions in authorities spending is immediately up within the air and tens of millions of People will face the implications.
Federal assist related to nonprofits, small enterprise loans, and state and native authorities grants shall be frozen. Moreover, the freeze is anticipated to disrupt ongoing well being care analysis and different initiatives, based on AP Information. Even federal grants which have already been awarded however not spent will now be halted.
Affect on College students
Trump’s memo despatched a wave of panic to American college students fearing for his or her FAFSA and different types of authorities monetary assist, just like the Pell Grant. Happily, it appears this type of monetary help shall be unaffected by Trump’s memo, based on Fox Information.
The president has nevertheless, expressed curiosity in completely abolishing the Division of Training, which might by consequence, upend all federal types of monetary assist.
Earlier than the pandemic, 80.6 % of Black college students acquired some kind of economic assist from the federal government, based on the Journal of Blacks in Greater Training. And with Black People carrying the best quantities of scholar mortgage debt, it’s clear Black people depend on the federal government for help.
On X, @Getthebagcoach wrote “Tens of millions and tens of millions of People shall be affected by one individual resolution to return down on the decrease and center class.”
Though FAFSA is protected for now, Okay-12 faculty funding may take successful with Trump’s pause. College districts depend on entry to grant funding, excluding Title I which is protected. Based on the memo’s language, assist distributed to public faculties for numerous causes might be impacted, though it has not been confirmed.
Affect on Small Companies
The language of the memo is broad, which is why it’s inflicting a lot confusion and panic. However though FAFSA stays protected, small companies might be in danger. Lendio Analysis estimates there’s at the very least 3.7 million Black-owned companies throughout the states, hundreds of which obtain some type of federal help.
Since 2023, actually, the Small Enterprise Administration (SBA) doubled the quantity of economic help particularly to Black-owned companies since 2020, based on information from SBA. However with such an abrupt pause from Trump, many small companies received’t have the sources to stay open.
Moreover, Trump’s memo places a pause on authorities packages related to housing help and billions in funding for state and native governments.
The one excellent news right here is that social safety, FAFSA, medicare, and different funds from the federal government on to people is not going to be affected by the pause, based on the president’s memo. However for People counting on the federal government for schooling and enterprise, their lives— identical to federal funding— is frozen in time.