Ruling Marks Setback for Administration’s Foreign Aid Cuts, Sparks Debate Over Executive Power

March 5, 2025 - WASHINGTON, D.C. – In a landmark 5-4 decision on Wednesday, March 5, 2025, the U.S. Supreme Court rejected President Donald Trump’s bid to maintain a freeze on $1.9 billion in foreign aid payments administered by the U.S. Agency for International Development (USAID). The ruling upholds a lower court order mandating the immediate release of funds owed to contractors and grant recipients for work completed prior to the administration’s controversial aid suspension, delivering a significant blow to Trump’s “America First” agenda.

The decision stems from a legal battle ignited by Trump’s January 20 executive order, issued on his first day back in office, which imposed a 90-day pause on all foreign aid disbursements. The administration argued the freeze was necessary to review whether USAID programs aligned with its foreign policy priorities, a move that halted life-saving humanitarian efforts worldwide and prompted lawsuits from aid organizations. These groups contended that the freeze violated federal law and the Constitution by overriding Congress-authorized spending, plunging their operations into chaos.

U.S. District Judge Amir Ali, appointed by former President Joe Biden, issued a temporary restraining order on February 13, prohibiting the administration from suspending payments. When the government failed to comply, Ali escalated the matter on February 25, ordering the release of nearly $2 billion by a midnight deadline the following day.

Chief Justice John Roberts briefly paused that deadline on February 26 to allow further review, but the Supreme Court’s majority—comprising Roberts, Justice Amy Coney Barrett, and the court’s three liberal justices—ultimately declined to block Ali’s directive.

In its unsigned order, the court noted that the February 26 deadline had passed and instructed Judge Ali to “clarify what obligations the government must fulfill to ensure compliance with the temporary restraining order, with due regard for the feasibility of any compliance timelines.” The ruling leaves intact Ali’s initial order while shifting the focus back to the district court for further proceedings, where a longer-term injunction against the aid freeze remains under consideration.

The Trump administration had sought to terminate over 90% of USAID’s contracts—nearly 5,800 awards worth $54 billion—and an additional 4,100 State Department grants, slashing a total of $60 billion in global assistance. Critics, including the nonprofits and contractors who brought the suit, warned of dire consequences, from layoffs and financial ruin for aid organizations to the disruption of food and medical aid in crisis zones like Ukraine, Georgia, and Nigeria. “The irreparable damage inflicted by this freeze cannot be overstated,” said a spokesperson for HIAS, one of the plaintiff groups, expressing relief at the ruling but lamenting the toll already taken.

Dissenting justices—Samuel Alito, Clarence Thomas, Neil Gorsuch, and Brett Kavanaugh—sharply criticized the decision. In a stinging dissent, Justice Alito called it “an act of judicial hubris” that “imposes a $2 billion penalty on American taxpayers,” questioning whether a single district judge should wield such power over executive-branch decisions. “I am stunned,” Alito wrote, arguing that the majority’s stance sets a dangerous precedent.

The administration, backed by Trump adviser Elon Musk, has framed the aid cuts as part of a broader push to shrink the federal government and redirect resources domestically.

USAID, which disbursed $43.79 billion in fiscal 2023 and employs 10,000 workers assisting 130 countries, has been a primary target. Most of its staff have been placed on leave or terminated, and its Washington headquarters shuttered amid the overhaul.

Legal experts see the ruling as a mixed outcome: a short-term loss for Trump, as funds must now flow, but not a definitive block on his broader aid-reduction strategy. “The court didn’t strike down the review process itself,” noted constitutional scholar Laura Hensley. “It’s about paying for work already done—future cuts could still proceed if done lawfully.”

As global aid groups await payment and the administration scrambles to comply, the decision reignites debate over the balance of power between the judiciary and the executive, with implications that may echo through Trump’s term and beyond.