Key messages
- The Trump Administration has implemented a sweeping transformation of US foreign assistance, one of the government’s important foreign policy tools, through mass firings, programme cancellations and the dismantling of the US Agency for International Development (USAID).
- The termination of aid programmes has produced life-threatening humanitarian consequences, created vacuums now being filled by China and other US rivals, and undermined long-standing US soft power and global leadership.
- Despite legal challenges and strong opposition from Democrats, the US Congress and the courts have thus far allowed the Administration to proceed with these controversial changes, revealing diminished checks and balances and making it likely that the damage to US credibility and capacity will take years to repair.
Analysis
Introduction
During Donald J. Trump’s first term (2017-21), he proposed deep spending cuts to US foreign assistance. However, the US Congress rebuffed most of these efforts by adding more money than requested and keeping budget levels roughly the same.
During his 2024 presidential campaign, Trump criticised foreign aid. He said, ‘We give so much money to people who have no respect for us at all’.
On his first day in office, Trump signed two executive orders on US foreign assistance. As he did in his first term, he signed an executive order to pause all US foreign assistance pending a 90-day review. The new executive order, however, included ominous language: ‘The US foreign aid industry and bureaucracy are not aligned with US interests and in many cases antithetical to American values. They serve to destabilise world peace by promoting ideas in foreign countries that are directly inverse to harmonious and stable relations internal to and among countries’.
He also signed an order establishing the Department of Government Efficiency (DOGE), a new entity proposed by billionaire Elon Musk, aimed at cutting costs, reducing bureaucracy, and making government more efficient to achieve a ‘realignment’ across the federal government. A few weeks later, he signed an additional executive order that directed US agencies to ‘initiate large-scale reductions in force’.
These initial actions previewed the aggressive, controversial steps Trump would take to implement a sweeping transformation of US foreign assistance and foreign policy.
Dismantling of USAID and the US Department of State firings
USAID
DOGE’s first significant action was to dismantle USAID. However, it did not originally plan to do so.
DOGE officials first approached USAID seeking stories about ‘viral waste’ they could use to build support for deep US funding cuts. DOGE officials first ordered USAID to immediately stop payments to contractors and vendors worldwide, cutting off support to USAID staff deployed overseas. When employees raised concerns about actions they believed were unlawful or dangerous, the Administration deemed them insubordinate. It used that allegation to justify putting staff on immediate administrative leave and to abruptly dismantle the agency entirely.
On 2 February Elon Musk wrote ‘USAID is a criminal organisation. Time for it to die’.
Secretary of State Rubio was appointed as the Acting USAID Administrator. He later announced plans to lead a two-month review to ensure the agency’s activities were aligned with the Department of State’s goals.
Following a six-week review, the Administration cancelled 83% of USAID programmes. During this time, thousands of USAID employees were fired or placed on leave, and billions of dollars in contracts and grants were cancelled.
On 28 March USAID sent out an e-mail titled ‘USAID’s Final Mission’ to staff, and the Department of State informed Congress that USAID’s workforce would be reduced from 13,000 to less than 900. Two months later, the Department of State notified Congress of its plans to dissolve USAID and absorb some of its functions.
Department of State
Compared with the headline news about changes at USAID, DOGE’s impact on the Department of State has been less public.
The department announced its own plans to bring the organisation ‘into the 21st century’ in April. Three months later it fired over 1,100 civil servants and nearly 250 foreign service officers based in Washington. An internal notice justified the action as ‘streamlining domestic operations to focus on diplomatic priorities’. It stated the cuts were ‘carefully tailored to affect non-core functions, duplicative or redundant offices, and offices where considerable efficiencies may be found’. Officers were fired regardless of their performance or their experience, but instead because they happened to be serving in an office or job function that was no longer deemed an Administration priority.
Department of State leadership also told many senior officers they would not be promoted and that they would not nominate career members of the Senior Foreign Service to ambassadorial positions overseas, forcing many into early retirement.
In total, of the 18,000 Department of State officers based in Washington, an estimated 3,000 workers are expected to leave the department in 2025. This includes 1,350 employees who were fired in July and an additional 1,600 employees believed to have left the service through a voluntary retirement scheme. To date, the department has not fired US foreign service officers serving at US embassies overseas.
US foreign assistance cuts
The Administration has also pursued a multipronged assault on US foreign assistance. This has taken three primary forms: an executive freeze, rescissions and proposed cuts in FY26 funding.
The freeze and stop-work order
As a follow-up to Trump’s 20 January executive order to suspend foreign assistance, the Department of State issued a cable instituting a pause on new foreign aid spending and a stop-work order on most foreign assistance grants and contracts worldwide. This move affected both ongoing programmes and future awards. While early waivers were granted for critical security assistance to Israel and Egypt and for emergency food aid, most programmes were halted.
Rescissions: making the cuts law
The White House sent a formal rescission request to Congress in May to cut US$9.4 billion in funding that had been approved but not yet spent. The proposal targeted USAID funding and the President’s Emergency Plan for AIDS Relief (PEPFAR), a US government initiative to control the HIV/AIDS pandemic.
Three months later, Congress passed the Rescissions Act of 2025, approving US$9 billion in funding cuts. The bill cut approximately US$7 billion for UN contributions, democracy programmes, climate initiatives and other humanitarian lines, as requested by the White House. However, the Senate narrowed some of the proposed cuts. It protected US$400 million for PEPFAR, programmes focused on major diseases, nutrition, maternal and child health, and aid for Jordan, Egypt and other key partners.
In the Senate, rescission bills are not subject to the 60-vote threshold needed to advance most legislation. Instead, they require only a simple majority, making them easier to pass on a party-line vote.
Then, in late August, the White House pursued a slightly different tactic: a ‘pocket rescission’ of an additional US$4.9 billion in international assistance. The targeted funds included US$3.2 billion in development assistance, US$838 million for peacekeeping operations and US$521 million for contributions to international organisations.
This so-called pocket rescission did not require Congressional action. It informed Congress of its plans not to spend funds previously approved by Congress just before the funds expired on 30 September. The White House touted that it was the first time in 50 years that the government had pursued this tactic.
The FY26 budget: a blueprint for deeper retrenchment
The Administration’s FY26 budget request proposes slashing approximately US$30 billion in foreign assistance from the levels enacted by Congress for FY25, representing a 41% decrease. When including the proposed rescissions, the cuts are even deeper, representing a 79% reduction.
The FY26 request includes cuts to most programmes and accounts, though US development finance and export agencies are an exception. For example, the US Trade and Development Agency and the Export-Import Bank would retain their FY25 spending levels. And the US Development Finance Corporation (DFC), an organisation established during the first Trump term to help the government compete with China, would receive a 19% reduction.
Congressional and legal responses
Congress
Trump entered office in 2025 with little patience for opposition, repeatedly demonstrating he would openly criticise and campaign against any Democrat or Republican who stood in his way. There are likely many more so-called traditional Republicans who have supported international aid in the past and do not support these controversial actions but have chosen to stay silent for their political survival.
Most Republicans backed the rescissions and have adopted the Administration’s messaging on the need for stronger fiscal discipline and a refocus of aid on US priorities. At the same time, a smaller bloc of GOP lawmakers has pressed for carve-outs and criticised the firings.
Democrats, on the other hand, opposed the cuts and firings almost uniformly, arguing they were illegal or imprudent, ‘an affront to the bipartisan appropriations process’, and harmful to US influence and global health. They asserted that Congress has the ‘power of the purse’ in the balance of powers between the US branches of government, and that the White House was overreaching by overriding funding decisions they had already agreed to. They also underscored that since Congress created USAID, only a change in the law authorised by Congress should enable the government to eliminate the agency. They tried to push back through letters, hearings, and blocking nominees, but have had little leverage to stop them.
Legal challenges
Trump’s controversial tactics have invited legal challenges, though he has largely been able to implement his policies while the cases move through the court system.
Many lawsuits were filed to block or limit the implementation of personnel- and agency-restructuring plans by DOGE and the Administration affecting the Department of State and USAID. However, there is no current injunction that comprehensively stops the Administration from moving forward.
The cases are preliminary and on appeal, with the outcomes uncertain. A case brought by the largest union representing US workers secured a preliminary injunction, but the Supreme Court stayed the relief. The case is ongoing, but it does not prevent the Administration from proceeding. Another case challenged the USAID firings and resulted in a district court decision that temporarily blocked the dismantling of USAID, but a circuit court subsequently lifted that relief. The case remains pending.
Many lawsuits were also filed to block the Administration from pursuing the sweeping foreign assistance cuts. The Administration has faced losses at the lower court, though many appeals courts have overturned those decisions in interim rulings, while the core legal issues remain unresolved.
In one case challenging Trump’s pocket rescission to claw back US$10 billion in foreign aid, a federal judge ordered the release of the funds. Yet when the White House appealed, the Supreme Court issued a preliminary view that the harm to the president’s ability to conduct foreign policy would ‘outweigh the potential harm’ to the groups being denied funding. The Administration was allowed to implement the change rescission while the broader merits of the case are considered.
Consequences
The cumulative effect of these actions has produced significant humanitarian consequences, an erosion of US global influence and diminished international standing.
Humanitarian impacts and insecurity
UNICEF cautioned that the reduction in assistance would limit its ability to reach millions of children, and the World Food Programme projected deep reductions in emergency food assistance. Mercy Corps, a global humanitarian aid organisation, stated that the US funding cuts would unequivocally ‘cost lives’.
Secretary of State Rubio has repeatedly claimed that he issued waivers for lifesaving assistance and that no one has died because of US foreign assistance cuts. However, anecdotes have emerged that challenge this assertion. One such example is when a five-year-old child died in the Democratic Republic of Congo when the malaria drug she needed could not be delivered, even though it was being held in a regional distribution warehouse just seven miles away.
A study jointly funded by the Spanish government estimated that an 83% reduction in USAID funding could lead to more than 14 million avoidable deaths by 2030, including 4.5 million deaths of children younger than five years old.
UN Secretary-General António Guterres has also warned that the US pullback would make the world ‘less safe’. UN peacekeeping forces will be reduced by 25% after the Trump Administration cancelled US$800 million in peacekeeping support in FY24 and 2025, and proposed eliminating funding in FY26.
Erosion of US influence and values
Before USAID was dismantled, it had served as an important tool of US soft power. It strengthened US influence by providing critical aid, bolstering diplomatic relationships, promoting political and economic models favourable to US interests, and mitigating instability. USAID’s departure erodes decades of trust and partnerships and signals to international partners that the government is no longer reliable.
Moreover, the current uncertainty surrounding US funding makes the partnership less predictable. For risk-averse nations, a Chinese funding offer that arrives quickly, without public drama and with fewer conditions, may be preferable to a US commitment that could be easily reversed.
The Trump Administration has also stopped funding nearly all US government programmes promoting democracy, human rights and press freedom worldwide. Authoritarian governments like China welcome reduced pressure, accountability and oversight. Two human rights organisations said the Chinese government sought to silence them after they lost US funding support.
Diminished geopolitical and multilateral standing
One of the most significant consequences of the US retrenchment is that it creates opportunities for China and other US competitors to fill. There have been documented cases of China stepping in to fund programmes when US foreign assistance was paused. For example, as the US has retreated from Africa, China has extended a zero-tariff policy on almost all exports to nearly all 54 African nations to bolster ties to the region. The head of Russia’s international assistance agency has also spoken openly about plans to capitalise on the gap left by USAID’s demise.
The cuts to USAID and DFC also undermine the US government’s aim to compete with China’s Belt and Road Initiative, its global infrastructure and economic development strategy. From 2013 to 2021 China invested US$679 billion in international infrastructure, almost nine times as much as the US during this period.
Lastly, pausing or cutting contributions to the UN diminishes US voting power and operational influence within the international system. This pullback from multilateral leadership reduces Washington’s ability to shape global norms and standards, set agendas at key UN agencies and secure leadership posts for US personnel. China, meanwhile, holds leadership positions in key agencies, giving it more room to shape international norms on issues ranging from food security to technology.
Observations
Foreign assistance cuts
In recent years, opinion polls have regularly shown that the US public believed foreign assistance accounted for 25% of the federal budget. In fact, it was just 1.2% in FY23. Surveys after Trump eliminated most USAID programmes found modest disapproval. This partially explains the tepid pushback from Congress when DOGE dismantled USAID.
The US government has increased foreign assistance levels over the years to advance US economic, security and governance objectives, backed by the belief that the country would prosper if other countries prospered as well. For Trump, however, foreign assistance is a giveaway, and the US is too generous. He thinks in terms of near-term deals or transactions and is therefore unwilling or unable to accept that foreign aid advances longer-term US interests.
Since the mid-20th century, US global interests have expanded beyond fighting the spread of communism to include advancing other goals, such as democracy, human rights and economic development. And given USAID’s broad mission and its decentralised approach, the Administration was able to cherry-pick –and sometimes stretch the truth– to highlight specific activities that were hard to defend in short soundbites to justify its sweeping cuts.
Cuts and reforms to USAID and the Department of State
The Administration’s cuts and so-called reforms to USAID and the Department of State have made little strategic sense. Instead, they are part of the Administration’s broader efforts to reduce the government workforce through mass layoffs, devalue the remaining federal workforce to encourage them to quit and protect officers who demonstrate allegiance to the President.
Ever since the late 19th century, the US federal civil service has been nonpartisan. In 1978 the US government adopted additional civil service reforms to ensure that the selection and advancement of federal workers were determined solely by relative ability, knowledge and skills, and that workers were retained based on the adequacy of their performance.
However, Trump favours a workforce that shows its allegiance to him. The Department of State announced new criteria for promotions and career advancement in the Foreign Service that evaluate employees on their ‘fidelity’ to the Administration’s policy goals, amongst other criteria.
It is far more difficult to fire federal workers than those in the private sector, though the Administration has sought to change that. It has fired thousands of workers, removed civil service protections from certain workers and attacked workers’ collective bargaining rights.
Russell Vought, Trump’s Office of Management and Budget Director, said that his goal once Trump returned to office would be to put career government servants ‘in trauma’. He added that when federal workers ‘wake up in the morning, we want them to not want to go to work because they are increasingly viewed as the villains’.
Institutions
It has been surprising how easily the Administration dismantled USAID, cut Department of State staff and implemented rescissions, eliminating billions of dollars in programmes the US Congress recently approved. These significant changes reveal a weakening of the institutional checks and balances and a penchant for this Congress to support the White House’s policy agenda over its institutional prerogatives.
Congress created USAID via the Foreign Assistance Act of 1961, but it allowed DOGE and the Administration to dismantle it without much of a fight. Congress has also said very little about the Department of State’s plans to significantly curtail functions established by acts of Congress, such as human rights, refugee admissions and stabilisation. And, as Democrats noted during the shutdown negotiations in fall 2025, if the Republican Congress is going to rubber-stamp Trump’s rescissions, how can Democrats trust Republicans to stick to these funding levels during the annual appropriations process?
DOGE was launched in January to great fanfare, but it has been quietly disbanded since then. After Elon Musk departed Washington in June, DOGE’s functions have been taken over by OMB. A senior government official recently confirmed that DOGE ‘doesn’t exist’ and is no longer a ‘centralised entity’.
Actions by Trump and DOGE have also pushed Congress to the sidelines of the larger debate about federal spending cuts. The DOGE website lists US$214 billion in savings, though many experts question or dispute these figures. DOGE or the OMB does not have the authority to cut spending after Congress appropriates funds. Only Congress can cut funds through rescissions, and the White House has requested only two rescissions in 2025, totalling US$15 billion. Moreover, even though Congress has the constitutional power of the purse, it does not actually know how much funding the White House has cut or frozen.
Trump’s actions also have shown that, if the Administration moves quickly enough, the courts will struggle to keep up. And even if the courts eventually rule against Trump on the merits, months if not years later, the damage is done and the changes will be hard to reverse.
The Supreme Court, with its six/three conservative majority, has issued many rulings favourable to the Administration. It has thus far given the President and the White House considerable latitude and deference, enabling the Administration to advance much of its agenda.
Conclusions
Taken together, the policies enacted by the Trump Administration represent a pivot away from decades of bipartisan consensus on US global leadership. The combined effect of deep personnel cuts and multi-billion-dollar funding cuts has produced a US foreign policy posture that has fewer resources to promote and advance US interests via soft power, has less leverage in bilateral and multilateral settings, is producing devastating humanitarian consequences and is creating a vacuum increasingly filled by rivals, particularly China.
The path forward is fraught with risk. If these policies are continued, there is likely to be higher mortality from preventable diseases, worsening famine conditions, increased instability and a marked increase in China’s and other US competitors’ influence.
The US can still compete on the world stage, but it now stands on a narrower and more fragile footing. And when the country decides it wants to change course, it will take a sustained commitment over many years to rebuild the human capital, capacity of foreign assistance implementers, partner relationships and international trust.
