The Trump administration has announced a sweeping $60 billion cut in U.S. foreign aid, eliminating more than 90% of the U.S. Agency for International Development’s (USAID) contracts. The decision, disclosed in an internal memo and federal court filings, marks one of the most drastic shifts in U.S. foreign policy in decades.
USAID Faces Massive Reductions
According to the memo obtained by the Associated Press, the cuts will result in:
- 5,800 out of 6,200 multiyear USAID contract awards being eliminated, slashing $54 billion in funding.
- 4,100 out of 9,100 State Department grants being terminated, cutting $4.4 billion from the budget.
These reductions leave few surviving USAID projects, limiting the ability of advocacy groups to challenge the decision in ongoing court battles.
Trump and Musk’s Push to Shrink Foreign Aid
President Donald Trump, along with ally Elon Musk, has prioritized drastically reducing the federal government’s role in foreign assistance. Both argue that USAID projects promote a liberal agenda and waste taxpayer dollars.
On January 20, Trump ordered a 90-day review of all foreign aid programs, effectively freezing U.S. assistance overnight. The funding halt has disrupted thousands of U.S.-funded initiatives abroad, as USAID staff have been forced into leave or terminated under Musk’s Department of Government Efficiency (DOGE).
Legal Battles and Accelerated Terminations
The contract terminations are happening at breakneck speed, with some calling it a strategy to sidestep a federal court order requiring the administration to temporarily lift the funding freeze.
Nonprofits owed money by USAID claim that Trump officials and Musk’s teams are rushing to terminate contracts to avoid paying outstanding debts. Court documents include an email from a USAID official stating:
“There are MANY more terminations coming, so please gear up!”
The State Department, led by Secretary of State Marco Rubio, reviewed the terminations and approved the cuts.
Impact on Global Aid Efforts
The decision represents a major shift away from decades of U.S. foreign policy, which has historically used foreign aid to stabilize economies, build alliances, and advance U.S. interests. With thousands of programs canceled or defunded, global health, education, and economic development efforts could face significant setbacks.
Following multiple warnings from the federal judge handling the case, Trump administration officials announced that they had resumed some USAID payments, but only released a fraction of the billions owed.
As the administration faces increasing legal and political scrutiny, the fate of U.S. foreign assistance remains uncertain.
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