President Donald Trump intended his flood of executive orders to shock and awe his opponents. But on Monday night, a memo from the Office of Management and Budget instead shocked the Trump White House.
That memo, with its call for a temporary pause to all federal-government grants and loans, set off widespread panic and confusion within the federal government and among the millions of individuals and institutions reliant on federal funds. But it was released without going through the usual White House approval processes.
The memo was produced by the budget office alone, which failed to get proper sign-off from the White House, according to a senior White House official and a second person familiar with the memo. The team headed by Trumps deputy chief of staff for policy, Stephen Miller, had requested to see the memo before it went out, but OMB never sent it over, these people said.
As a result, the White House was caught off guard as the memo sparked the sort of chaos that Trumps team had hoped would be a vestige of his first term. Within 48 hours, OMB was forced to rescind the memo.
After the memo was initially released, White House staffersknowing they faced a communications problem, if not also a policy oneprepared White House Press Secretary Karoline Leavitt to handle questions on the funding freeze at her inaugural briefing yesterday.
As anticipated, reporters peppered her with questions about which federal programs might be affected by the freeze. I have now been asked and answered this question four times, a slightly exasperated Leavitt said. To individuals at home who receive direct assistance from the federal government: You will not be impacted by this federal freeze.
In response to the confusion, OMB sent out a clarification memo yesterday, insisting that the pause did not apply across-the-board and was intended to affect programs from the Biden administration that were not in sync with Trumps day-one executive orders, such as DEI initiatives and the green new dealwhich Republicans use as a catchall term for climate programs.
But if the OMB memo was not properly vetted, it should not have come as a complete surprise. A slide deck labeled Office of Management and Budget that outlines priorities and goals in line with Trumps agendamarked confidential, bearing the seal of the executive office of the president, and dated January 2025has been circulating on Capitol Hill. The presentation, focused on what it calls regulatory misalignment, presents columns of problems paired with actions intended to address them.
The Impoundment Control Act of 1974, for instance, is listed as a problem because it undermines the presidents ability to ensure fiscal responsibility. The suggested action is restoring impoundment authority by challenging the acts constitutionality in court. Both Trump and Russell Vought, his nominee to lead the budget office, have argued that the Watergate-era lawwhich generally prevents the executive branch from spending less than what Congress has appropriated for various programs and purposesis unconstitutional.
Another problem, according to the presentation, is that existing legal interpretations protect entrenched bureaucratic practices. To solve that, it calls for the appointment of a bold General Counsel at OMB with a mandate to challenge outdated legal precedents that protect the status quo.
An OMB spokesperson, Rachel Cauley, told me that, despite outlining in detail many steps that Trump actually took once in office, the slide deck was not the work of Trumps incoming team. Trump officials have never seen this document before and its pretty apparent it was generated before Trump was in office, Cauley wrote to me in a text message.
But whatever its origin, the slide deck seems to have been oddly prophetic. The source familiar with the OMB memo that touched off so much controversy this week said that it had been drafted by Mark Paoletta, who was appointed by Trump as the agencys general counsel. OMB declined to comment on that claim.
Even after OMB rescinded its Monday memo, confusion reigned. This afternoon, Leavitt tried to clarify things with a post on X: This is NOT a rescission of the federal funding freeze, she wrote. It is simply a rescission of the OMB memo.
Her post did little to resolve the lingering questions surrounding federal funds, but made it perfectly clear how the White House now feels about the memo.