The White House on Tuesday defended the Trump administration's decision to freeze all loans and grants disbursed by the federal government, a move which has caused confusion about the fate of trillions of dollars in funding.
"This is a very responsible measure," White House press secretary Karoline Leavitt told reporters in Washington, adding: "It's incumbent upon this administration to make sure, again, that every penny is being accounted for honestly."
The White House is pausing federal grants and loans starting Tuesday, as Trump's administration begins an across-the-board ideological review of its spending, causing confusion and panic among organizations that rely on Washington for their financial lifeline.
Administration officials said the decision was necessary to ensure that all funding complies with Trump's executive orders, which are intended to undo progressive steps on transgender rights, environmental justice and diversity, equity and inclusion, or DEI, efforts. They also said that federal assistance to individuals would not be affected, including Social Security, Medicare, food stamps, student loans and scholarships.
However, the funding freeze could affect trillions of dollars, at least temporarily, and cause widespread disruption in healthcare research, education programs and other initiatives. Even grants that have been awarded but not spent are supposed to be halted. State agencies and early education centers appeared to be struggling to access money from Medicaid and Head Start, stirring anxiety with answers hard to come by in Washington.
The issue dominated the first briefing held by White House press secretary Karoline Leavitt. She said the administration was trying to be "good stewards" of public money by making sure that there was "no more funding for transgenderism and wokeness." The pause on grants and loans was scheduled to take effect at 5 pm ET (11 pm Paris), just one day after agencies were informed of the decision.