STORY UPDATED AT 5:06PM ET (See bottom of post)
At 12:42pm ET I received a copy of a brand new memo sent out by the White House’s Office of Management of Budget (OMB) rescinding its memo from Monday that had announced plans to freeze all federal grants and loans. At 12:48, I shared it on Bluesky.
The copy was shared with me by a federal government source who I have chosen to keep anonymous to protect their job.
Here is the text of the memo in full:
EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 20503
THE DIRECTOR
January 29, 2025
M-25-14
MEMORANDUM FOR HEADS OF EXECUTIVE DEPARTMENTS AND AGENCIES
FROM: Matthew J. Vaeth, Acting Director, Office of Management and Budget Nigh
SUBJECT: Rescission of M-25-13
OMB Memorandum M-25-13 is rescinded. If you have questions about implementing the President’s Executive Orders, please contact your agency General Counsel.
As you’ll recall, The Handbasket was the first to break the news of Monday’s catastrophic memo calling on all federal agencies to “pause” federal grants and loans. The stated purpose was so OMB could do an “audit” of all grant programs to identify any that involve “financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal.”
There was justified uproar from government officials and regular people whose lives are impacted by an astonishingly wide swath of programs funded by government grants, and attorneys general from 23 blue states announced they’d be filing suit to stop the freeze. Just before 5pm yesterday, we learned the good news that a judge had issued a temporary restraining order on the funding freeze, effective til Monday.
But on Wednesday, that all changed with the issuing of OMB’s new memo.
Meanwhile, the confirmation hearings for Russell Vought, Trump’s OMB director nominee, are happening right now. In a questionnaire for the job he said he thought the 2020 election was “rigged”, and he was one of the key architects of Project 2025. White House Press Secretary Karoline Leavitt essentially admitted from her podium during a press briefing Tuesday that Vought was already running the agency without having been confirmed—and the impact is obvious.
“He [Vought] told me to tell all of you [the media] that the line to his office is open for other federal agencies,” Leavitt said.
For now the federal programs threatened by the freeze are safe, but that’s no invitation to get comfortable. If Vought gets confirmed, he’ll almost certainly try this again with a slightly modified approach that he feels is more likely to stick. His Project 2025 buddies have been installed at every level of government to help him implement the conservative hellscape blueprint.
But the one thing these guys forgot to factor in is that we still have a free press and the people still have power. As New York Attorney General said in a mic drop moment at the end of a press conference yesterday, “We will not sit idly by and allow individuals to trespass on the rights of Americans.”
UPDATE:
Just as I was putting the finishing touches on my post about the rescinded order and hit send, WH Press Secretary Karoline Leavitt tweeted the following:
It understandably caused extreme confusion. But does it mean anything? In short: No.
As Georgetown law professor Steve Vladeck explained on Bluesky:
1. The executive orders did not freeze federal funding.
2. The Monday OMB memo did freeze federal funding.
3. OMB rescinded Monday’s memo, thereby rescinding the funding freeze.
4. The EOs (which did not freeze federal funding) are still in effect—and, for these purposes, irrelevant.
Shortly after, an emergency virtual hearing was called with regard to the lawsuit brought by the 23 states attorneys general. US District Court Judge Jack McConnell, representatives from some of the states, and a lawyer from the DOJ were present.
A lawyer for Trump’s U.S. Department of Justice argued that the lawsuit should be moot, since the memo was rescinded. But McConnell didn’t buy that argument, considering Leavitt’s tweet. Instead, he ordered the plaintiffs to file a revised order for a temporary restraining order, to properly ask to halt any freeze on federal funds, rather than just the now-rescinded memo.
McConnell also said that, were the original OMB memo not rescinded, he would have probably granted a temporary restraining order to halt the funding freeze. “I was, and still am, very concerned about the irreparable harm that has been put forth” in the original OMB memo, McConnell said during the hearing.
I know this is all very confusing. I’m right there with you. The main takeaway is that McConnell is inclined to block the Trump administration from implementing the freeze but issued no order, according to Chris Geidner of Law Dork. “The states are to submit a proposed order addressing concerns about wording given the rescission, then DOJ gets 24 hours to respond, then he will decide,” Geidner explained.
Now we wait and see what the administration tries next.
