Judge Orders Trump Administration to Reinstate Foreign Aid Funding//

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//Judge Orders Trump Administration to Reinstate Foreign Aid Funding//

A federal judge has ruled against the Trump administration’s abrupt suspension of foreign aid, mandating that funding be restored to contractors and organizations impacted by the sudden halt. The decision comes after significant pushback from businesses and nonprofits that suffered due to the administration’s unilateral freeze on congressionally approved aid.

The judge concluded that the Trump administration appeared to act in an “arbitrary and capricious” manner by abruptly shutting off all foreign aid without considering consequences for businesses to whom that aid was awarded prior to Trump’s inauguration.

Court Rules Trump’s Foreign Aid Freeze Unlawful

On Thursday, U.S. District Judge Amir Ali in Washington, D.C., issued a decisive ruling, stating that the Trump administration’s 90-day freeze on foreign aid was "arbitrary and capricious." Ali emphasized that the administration failed to account for the widespread harm caused by halting funding without evaluating the consequences.

“At least to date, Defendants have not offered any explanation for why a blanket suspension of all congressionally appropriated foreign aid, which set off a shock wave and upended reliance interests for thousands of agreements with businesses, nonprofits, and organizations around the country, was a rational precursor to reviewing programs,” Ali wrote in his ruling.

Ali’s order prevents the administration, including Secretary of State Marco Rubio and Office of Management and Budget Director Russell Vought, from enforcing contract cancellations or stop-work orders issued after Trump’s inauguration. The ruling effectively blocks a central provision of Trump’s executive order, which had mandated the suspension of foreign aid spending for three months.

Widespread Damage to Businesses and Organizations

The freeze on foreign aid funding had immediate and far-reaching consequences. According to attorneys representing contractors, businesses were shutting down, workers were losing jobs, and critical supplies, including food and medicine, were going to waste. The situation was exacerbated by the administration’s lack of justification for the sudden halt.

“Shutting down billions of dollars in government spending, sending numerous foreign aid partners large and small into oblivion, shutting them down so they are out of business is clearly of sufficient political, social, and economic significance that it would require clear congressional authorization,” said Stephen Wirth, an attorney representing affected groups.

Documents provided by the administration at the judge’s request revealed that over 200 foreign aid contracts had already been canceled within a single week of the freeze. The harm extended beyond foreign entities to U.S.-based companies and organizations working with international partners, leading to mass layoffs and furloughs.

DOJ’s Defense Rejected by Court

In its defense, the Justice Department argued that the administration’s actions were lawful because they were taken at the direction of the president. DOJ attorney Eric Hamilton contended that USAID and the State Department were simply following an executive order and were thus not subject to review under the Administrative Procedure Act (APA), which governs the actions of federal agencies.

However, Ali dismissed this argument, stating that such a rationale would effectively place presidential directives beyond judicial review, undermining the APA.

“Defendants’ argument, at least as it has been articulated to date, proves too much—it would allow the President and agencies to simply reframe agency action as orders or directives originating from the President to avoid APA review,” Ali wrote.

Broader Implications of the Ruling

Ali’s decision marks the second judicial ruling against Trump’s aggressive defunding of USAID, the agency responsible for distributing billions in foreign aid. Last week, U.S. District Judge Carl Nichols, a Trump appointee, blocked the administration from placing thousands of workers on administrative leave and restricting their access to government systems. Meanwhile, another judge, Loren AliKhan, has also halted parts of Trump’s domestic spending freeze.

These legal challenges signal significant hurdles for Trump’s broader attempts to reshape federal spending unilaterally. While further litigation is expected, the ruling underscores the limits of executive power when it comes to altering congressionally approved funding without due process.

For now, foreign aid contractors can breathe a temporary sigh of relief as funding is restored and the legal battle continues.