The United States has significantly cut funding for overseas development and aid programs, with multi-year contracts reduced by 92%, amounting to $54 billion, the State Department announced Wednesday.
Sweeping Budget Cuts Under Trump’s ‘America First’ Policy
On his first day in office, President Donald Trump signed an executive order freezing all U.S. foreign aid for 90 days. The move aimed to review international spending and eliminate programs that did not align with his “America First” agenda.
A key target of the review was multi-year foreign assistance contracts under the U.S. Agency for International Development (USAID). The vast majority of these contracts were eliminated during the evaluation process.
“At the conclusion of a process led by USAID leadership, including tranches personally reviewed by Secretary Marco Rubio, nearly 5,800 awards worth $54 billion were identified for elimination—representing a 92% reduction.” —State Department spokesperson
Foreign Assistance Grants Also Impacted
Beyond multi-year contracts, the review examined over 9,100 grants tied to foreign assistance, valued at $15.9 billion.
Following the evaluation, the administration terminated 4,100 grants, amounting to $4.4 billion, reflecting a 28% reduction.
“These commonsense eliminations will allow bureaus to focus on remaining programs, find efficiencies, and align future programs with the Administration’s America First priorities.” —State Department statement
Programs That Were Spared
Despite the cuts, some critical programs remained intact, including:
✔ Food assistance programs
✔ Life-saving medical treatments (HIV, malaria, etc.)
✔ Support for countries like Haiti, Cuba, Venezuela, and Lebanon
Court Orders and Legal Battles Over the Aid Freeze
The Trump administration faced legal challenges over the aid cuts. On Tuesday, a federal judge ordered the administration to unfreeze all aid within two days, following an earlier court ruling that had been ignored.
However, later that evening, U.S. Supreme Court Chief Justice John Roberts granted the administration’s request to temporarily block the lower court’s order, pending further review.
USAID Faces Mass Layoffs Amid Budget Slash
Before the freeze, USAID had a workforce of over 10,000 employees. The budget cuts led to:
🔻 1,600 U.S.-based employees being laid off
🔻 Most remaining staff placed on administrative leave
The move has shocked and frustrated many within the agency, which was created in 1961 to oversee U.S. foreign aid efforts.
Elon Musk’s Role in Cutting Government Spending
During his campaign, Trump vowed to slash federal spending and bureaucracy. To achieve this, he appointed billionaire Elon Musk—one of his top donors and close advisors—to lead the newly created Department of Government Efficiency (DOGE).
With USAID’s budget drastically reduced, concerns remain over how these cuts will impact global humanitarian efforts and U.S. diplomatic influence abroad.
