Appeals court says Trump officials can withhold billions in foreign aid

Appeals court says Trump officials can withhold billions in foreign aid

A federal appeals court has ruled that the Trump administration can continue withholding tens of billions of dollars in foreign aid, reversing a lower court’s order to release the funds. The 2-1 decision by the D.C. Circuit Court of Appeals lifted a preliminary injunction issued earlier this year that required the administration to allocate money for food, medicine, and development projects. Judges appointed by George H.W. Bush and Donald Trump formed the majority, finding that international aid groups challenging the freeze lacked legal standing to sue, the Washington Post reported.

The panel’s decision did not settle the broader question of whether the president has the power to impound funds approved by Congress, an issue that has become a flash point in Trump’s second term. Critics argue the freeze undermines Congress’s constitutional “power of the purse,” while the administration insists it is aligning spending with US interests. Plaintiffs plan to appeal to the full 15-judge D.C. Circuit, warning that the freeze could result in the loss of aid set to expire at the end of the fiscal year on September 30.

The freeze, announced in January as one of Trump’s first acts upon returning to office, has sparked alarm among aid organizations. More than 60,000 metric tons of food aid — some already expired — sit in warehouses, undelivered. A study in The Lancet projected the cuts could cause up to 14 million additional deaths by 2030, including up to 5 million children under five. The Trump administration dismantled USAID, folding it into the State Department, and cancelled more than 10,000 foreign aid awards, actions critics say will deepen humanitarian crises worldwide.

In February, US District Judge Amir Ali issued a temporary restraining order on parts of the freeze, later expanding it into a preliminary injunction in March. Ali ruled that the administration lacked authority to withhold the aid and appeared to have no intention of spending it, ordering officials to reallocate the funds. Although the administration said it would comply with court orders, plaintiffs contend little progress has been made in the five months since.

The decision is seen as a political win for Trump’s broader agenda to reshape federal spending priorities, but it carries diplomatic risks. Aid groups warn that withholding funds will damage America’s credibility and relationships with partner nations, particularly in regions where U.S. assistance plays a key role in stability and public health. Judge Florence Y. Pan, the lone dissenter and a Biden appointee, argued that the ruling enables the executive branch to sidestep the separation of powers, warning it “derails the carefully crafted system of checked and balanced power.”

If the full D.C. Circuit or the Supreme Court takes up the case, it could set a lasting precedent for presidential authority over congressionally approved spending — with potentially far-reaching consequences for US foreign policy and humanitarian aid.