The Scoop
President Donald Trump is cutting nearly $3 billion in spending, much of it reserved for foreign aid, by unwinding part of a 2023 fiscal deal loathed by conservatives, three senior White House officials told Semafor.
Trump is slashing from a pot of money deemed emergency spending by the 2023 Fiscal Responsibility Act, which capped federal spending but also included a side deal criticized by Trump and his allies. One element of the 2023 law’s side deal allowed for more than $12 billion in emergency spending for this year, but Trump is effectively deeming about a quarter of that as outside the scope of any emergency.
One of the White House officials said Trump was acting “unilaterally” by exercising his discretion over whether spending does indeed constitute an emergency. His decision will be communicated to Congress officially in the form of a presidential memo.
Roughly $2.5 billion of the $2.9 billion in cancelled spending would have gone to foreign aid, including migration and refugee assistance for nongovernmental organizations as well as economic development money slated for Moldova and Georgia. The move does not affect military assistance to nations like Ukraine.
The cuts will also target diversity, equity, and inclusion projects.
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It’s clear that the White House has been waiting to unravel leftover spending from the 2023 debt ceiling fight. The Office of Management and Budget is now run by Russ Vought, who opposed the Fiscal Responsibility Act forged by former Rep. Kevin McCarthy.
McCarthy’s speakership eventually imploded, in part thanks to angst over his handling of spending issues.
Vought is soon to be joined by deputy budget director nominee Dan Bishop, a former congressman who criticized McCarthy over the 2023 law. Bishop is expected to be confirmed by the Senate later this month.
Their office made the case to Trump to ax the spending, though the president had always hated the 2023 law.
A second of the three White House officials called the Fiscal Responsibility Act’s side deals the “worst aspect” of the law, describing them as a “shell game” designed to avoid spending caps.
“It’s not the way to proceed,” added the second White House official, who said some of the foreign aid money is “not well-vetted, is not well considered. In fact, not only is it not an emergency, but it’s probably some of the lowest-priority spending that you could identify.”
The remaining roughly $9.4 billion in designated emergency spending that the 2023 law allotted will remain in place.
Trump’s move comes after Congress earlier this month passed a government funding plan that runs through Sept. 30, a law that continued some of the side deals from two years ago. The 2023 law raised the debt ceiling and tried to cap spending while also allowing some spending outside the caps.
Beyond Vought’s ascension, Trump’s attack on the 2023 law was foreseeable for another reason: He’s maximizing his presidential authority to reshape government on multiple fronts and scuttle what remains of the Biden presidency.
Democrats who vocally opposed last week’s spending plan, in fact, are still worried that it will give him even more sway to reorganize government spending. And Hill Republicans are hopeful the Trump administration will send its spending cuts to the Capitol for Congress to vote on later this year.
Notable
- The separate question of whether Trump can unilaterally cancel spending that Congress didn’t give him leeway over, otherwise known as impoundment, is at the heart of broader legal battles over his funding decisions, as E&E News reported.
- The White House and conservatives have discussed having that impoundment fight, according to Fox News.