The United States Agency for International Development (USAID) is not a cabinet-level institution, yet it has an outsized influence on global development. In fiscal year 2023, it dispersed around $43.8 billion, amounting to just 0.7 percent of the $6.1 trillion federal budget. Despite its relatively small slice of federal spending, USAID’s work saves lives, boosts global health programs, and advances US foreign policy objectives.
Now, in the second Trump administration, USAID has become a bellwether for how sweeping executive orders could shut down—or at least dramatically hamper—vital government functions. Insiders and external observers worry that recent actions could undermine a decades-old bipartisan approach to providing global aid and assistance to vulnerable communities.
Why USAID Matters
From HIV/AIDS treatments to malaria prevention, USAID funds and coordinates programs that directly save or improve millions of lives each year. For instance, under the President’s Malaria Initiative, the agency financed:
36.8 million bed nets in 2023
48 million doses of malaria-preventing medication
Even brief disruptions in funding or staffing could translate into missed treatment windows, reduced prevention measures, and potentially increased mortality in developing countries. This underscores the stakes involved when the administration issues executive orders freezing foreign aid.Trump’s Executive Orders and the Initial Freeze
On his first day back in office, President Donald Trump signed an executive order placing a 90-day freeze on all foreign aid spending. A week later, he issued a similar pause on most of the federal budget.
Soon after, Secretary of State Marco Rubio instructed that no new foreign aid obligations should be made unless explicitly permitted by law. Even lifesaving initiatives like PEPFAR (President’s Emergency Plan for AIDS Relief), which supplies HIV/AIDS drugs and preventive services to tens of millions, felt the impact. Although a partial waiver was eventually granted for some humanitarian aid, the damage to ongoing programs was already significant.
Legal Concerns
Multiple sources within USAID describe these moves as legally dubious. Federal courts have historically rejected “impoundment” attempts—where a president blocks the spending of congressionally appropriated funds. The Impoundment Control Act of 1974 explicitly prohibits the White House from unilaterally withholding such funds. Nonetheless, the Trump administration maintains that these legal precedents are unconstitutional, setting the stage for ongoing court battles.
Step 1: Pull the Funding
The freeze effectively blocks the flow of funds to the “implementing partners” who carry out USAID’s programs. These partners include:
For-profit and nonprofit contractors
Nongovernmental organizations (NGOs)
Local government entities in developing countries
By halting new obligations and disbursements, USAID’s mission came to a standstill. While a district court judge issued a preliminary injunction that temporarily lifted the freeze on some federal grants, it did not explicitly address the foreign aid component. That left many of the agency’s critical global health and development programs in limbo.
Step 2: Pull the People
This time around, the administration’s efforts went beyond budget cuts. Roughly 60 senior career officials at USAID—those belonging to the Senior Executive Service or serving as senior Foreign Service employees—were placed on paid administrative leave. Unlike political appointees, these staffers typically remain in their roles through different administrations.
Many were high-level managers responsible for entire bureaus and large teams.
Several senior attorneys in the Office of the General Counsel, particularly those involved in ethics oversight, were also put on leave. Simultaneously, institutional support contractors (ISCs), who make up more than a quarter of USAID’s workforce, were furloughed or otherwise told not to report. The Bureau of Humanitarian Assistance, for example, saw a 40 percent workforce reduction due to ISC furloughs—impacting the agency’s response to crises like famines, natural disasters, and epidemic outbreaks.
Threat of “Schedule Policy/Career” (Formerly “Schedule F”)
In a parallel move, the Office of Personnel Management (OPM) revived a plan to reclassify certain career civil service roles—those deemed “confidential, policy-determining, policy-making, or policy-advocating”—into a new category with fewer job protections. Known informally as “Schedule F” during Trump’s first term, this rebranding could make it easier to dismiss career officials, further eroding the agency’s institutional memory and expertise.
Step 3: Instill Fear
The cascading effect of funding freezes and forced administrative leaves has created a climate of fear within USAID. Employees worry about retaliation if they speak out or question directives. The removal of photos of aid beneficiaries and agency staff from USAID headquarters—leaving behind bare frames—serves as a stark symbol of the uncertainty permeating the organization.
“If your goal is responsible downsizing, you don’t remove 60 top leaders and send home all the contractors,” says Jeremy Konyndyk, a former USAID official and current president of Refugees International. “This looks more like an effort to create an atmosphere of intimidation.”
The fear, confusion, and abrupt changes in leadership structures compromise the day-to-day efficacy of USAID. Managers on administrative leave no longer oversee their teams, critical roles remain unfilled, and remaining employees risk dismissal if they are within their one-year probationary period or fall under the new reclassification guidelines.
The Bigger Picture: A Template for Disruption
USAID’s current turmoil signals a broader strategy for the second Trump administration: using legally contentious impoundment tactics, mass personnel reassignments, and new job classifications to neutralize sections of the federal bureaucracy. After partially rolling back the total freeze on all government grants, the White House could still continue withholding or delaying funds in target areas like foreign aid and climate initiatives.
“What’s happening at USAID could very well be a trial balloon,” notes one senior official. “It shows how they might tackle other departments, whether that’s the Environmental Protection Agency, the Department of Education, or beyond.”
The US Agency for International Development, once a largely apolitical arm of American diplomacy, now finds itself embroiled in high-stakes legal and political battles. Whether you view foreign aid as a pillar of US global leadership or an expendable budget item, there is little doubt that disruption at USAID could lead to tragic outcomes. From halting malaria prevention to pausing HIV/AIDS treatments, these sudden moves put countless lives at risk.
Moreover, the organizational turmoil foreshadows what could happen across the federal government if similar tactics are employed elsewhere. By freezing funds, furloughing contractors, and removing key career personnel, the second Trump administration appears to be testing just how far it can go in reshaping—or dismantling—essential public services.