Federal Appeals Court Backs Trump’s $2 Billion Foreign Aid Reduction

A federal appeals court Wednesday authorized President Trump to proceed with withholding approximately $2 billion in foreign aid disbursements, reversing a district court decision that had prevented the administration from reducing payments through the US Agency for International Development.

The US Court of Appeals for the District of Columbia issued a 2-1 decision removing the temporary restraining order previously imposed by District Judge Amir Ali, a Biden administration appointee. Ali’s order had required USAID to maintain foreign assistance payments to organizations that had already completed contracted work.

The legal challenge originated in February when two nonprofit groups—the AIDS Vaccine Advocacy Coalition and Journalism Development Network—filed suit after Trump implemented a 90-day suspension of foreign aid funding on his inauguration day.

Judge Karen Henderson, nominated by former President George H.W. Bush, authored the majority opinion stating the plaintiff organizations did not have legal standing to challenge the administration’s funding suspension.

Henderson’s opinion stated that the district court was mistaken in granting the relief, as the grantees do not have a legal basis to pursue their claims.

The nonprofits had contended that the president overstepped his constitutional authority by effectively dismantling USAID and blocking spending already authorized by Congress.

Henderson’s majority decision, supported by Judge Gregory Katsas, a Trump nominee, determined that under the 1974 Impoundment Control Act, only the Government Accountability Office—Congress’s oversight agency—possessed the authority to contest presidential orders withholding foreign aid.

In a sharp dissent, Judge Florence Pan, appointed by President Biden, characterized the funding suspension as “unlawful” and cautioned it could enable “tyranny.”

Pan, in her dissent, argued that the court’s approval and enablement of the Executive’s illegal actions undermines the carefully designed system of checks and balances, which exists as the strongest Protection against the consolidation of too much authority in one branch.

A spokesperson for the White House Office of Management and Budget commended the ruling, telling Reuters that it would stop “radical left dark money groups” from “maliciously obstructing the president’s ability to spend responsibly and manage foreign aid lawfully in line with his America First agenda.”

The Trump administration had earlier sought Supreme Court intervention to remove Ali’s restraining order, but the nation’s highest court declined the request in a 5-4 vote.

According to a State Department memorandum released in February, the administration planned to cut approximately $60 billion in foreign aid expenditures and end 92% of USAID-issued grants.

The memo detailed findings from a foreign aid review commissioned by Trump, which examined nearly 15,000 grants and recommended eliminating almost 10,000—predominantly those administered by USAID.

USAID became an early focus for substantial budget reductions by Trump and the Department of Government Efficiency, previously overseen by billionaire Elon Musk, due to allegations of extensive waste, fraud, and mismanagement within the organization.

In July, Congress approved a White House rescission proposal that recovered approximately $8 billion previously allocated to USAID.

Source: nypost.com