Trump’s Federal Grant Freeze: Economists Warn of Ripple Effects [Video]

Starting Tuesday, Jan. 28, 2025, at 5 p.m. Eastern Time, the White House will pause federal grants and loans while the Trump administration reviews its spending to ensure it follows President Donald Trump‘s executive orders.

These orders target changes to policies related to transgender rights, environmental justice, and diversity, equity, and inclusion (DEI). Federal agencies have been instructed to assess their financial aid programs to determine which ones might be impacted. Medicare and Social Security benefits will not be affected.

The administration emphasized that this pause is temporary, and aims to ensure that federal funds are used in a manner consistent with the President’s policy objectives.

Opponents, such as Sen. Patty Murray and Rep. Rosa DeLauro voiced strong concerns in a letter to Matthew J. Vaeth, the acting director of the Office of Management and Budget, warning that these actions could disrupt federal programs.

Newsweek has consulted economists and experts in public affairs to evaluate how the freeze could impact …