A U.S. judge has once again stopped President Donald Trump’s administration from putting a hold on trillions of dollars in federal funding. This funding includes grants, loans, and other financial aid that help businesses, nonprofits, and local governments.
Why Was Funding Frozen?
Back in January, the White House’s Office of Management and Budget (OMB) ordered all federal agencies to pause spending on financial aid programs. The reason? Trump’s administration wanted time to review all grants and loans to make sure they aligned with his policies. These included ending diversity, equity, and inclusion (DEI) programs and stopping funding for projects that combat climate change.
The Lawsuit That Stopped It
Several groups—including small businesses and nonprofits—argued that this funding freeze would cause serious harm. They took the case to court, and Judge Loren AliKhan, who was appointed by former President Joe Biden, agreed with them. She temporarily blocked the freeze, saying it could have “catastrophic” consequences if allowed to continue.
Trump’s Team Fights Back
The Trump administration later withdrew the original memo about the funding freeze, but many feared the policy was still in place. White House Press Secretary Karoline Leavitt confirmed those fears, posting on X (formerly Twitter) that the memo was gone, but the freeze itself was not officially canceled.
What Happens Next?
The judge’s decision keeps federal funding flowing for now, but the fight isn’t over. Trump’s team may try again, and legal battles are expected to continue.
Stay tuned as this story unfolds!
