On Friday, September 26, 2025, the U.S. Supreme Court handed down a decision that has reignited a high-stakes debate over the balance of power in Washington: the Court allowed President Trump’s administration to continue withholding more than $4 billion in foreign aid funding, money that Congress had already approved for a vast array of overseas projects. The ruling, which came from the Court’s emergency docket, is not a final judgment on the merits of the case, but its immediate impact is profound—both for the organizations that rely on U.S. foreign aid and for the constitutional principle known as the "power of the purse."
The Supreme Court’s unsigned order reflected the Court’s 6-3 conservative majority, with Justices Elena Kagan, Sonia Sotomayor, and Ketanji Brown Jackson dissenting. The majority’s rationale, as summarized in the order, was that the "asserted harms" to the executive branch’s ability to conduct foreign affairs "appear to outweigh the potential harm" faced by the recipients of the foreign aid. The Court emphasized that its decision "should not be read as a final determination on the merits," instead characterizing it as a preliminary view consistent with standards for interim relief, as reported by States Newsroom and DW.
The legal battle at the heart of the case centers on whether the White House budget office can unilaterally withhold or rescind funding that Congress has already appropriated. At issue is a tranche of more than $4 billion that Congress approved last year for overseas development assistance, peacekeeping operations, and efforts to promote democracy around the world. In late August 2025, the Trump administration sent Congress a second rescissions request, proposing a clawback of billions in foreign aid dollars, including funds for the Corporation for Public Broadcasting and various international programs. However, neither the House nor the Senate has voted on this proposal, and the Supreme Court’s ruling now allows the White House to withhold the money regardless.
White House budget director Russ Vought was quick to celebrate the decision, calling it a "Major victory" on social media shortly after the order was released. According to States Newsroom, Vought and others in the administration argue that the Impoundment Control Act gives the president the authority to send Congress a rescissions request and, if Congress does not act within 45 days, to cancel the funding unilaterally. The Government Accountability Office, however, has deemed this move illegal, stating that Congress must explicitly approve any such rescission.
The origins of the dispute stretch back to February 2025, when the Trump administration paused foreign aid programs for 90 days to review whether they aligned with the president’s "America First" foreign policy agenda. The administration has been particularly critical of what it considers "wasteful" aid programs, seeking to redirect or eliminate funding that does not support its stated objectives. As DW reported, since returning to office for a second term in January 2025, the Trump administration has drastically downsized U.S. foreign aid operations, with Secretary of State Marco Rubio leading efforts to merge USAID’s programs with the State Department, effectively dismantling the world’s largest international aid agency.
For many organizations that depend on U.S. foreign aid, the consequences of the freeze are potentially catastrophic. Plaintiffs in the case, including nonprofits and development companies, warned the courts that withholding the funds could threaten their very existence. One such organization, Democracy International, derived 98% of its 2024 revenues from U.S. Agency for International Development (USAID) awards, according to court filings cited by CBS News. Lawyers representing these groups argued that the appropriations legislation passed by Congress remains binding on the executive branch, and that the administration’s actions undermine the basic constitutional structure of government.
Justice Elena Kagan, writing for the dissent and joined by Justices Sotomayor and Jackson, did not mince words about the gravity of the situation. "This emergency application raises novel issues fundamental to the relationship between the President and Congress," Kagan wrote. "It arises from the refusal of the President and his officers to obligate and spend billions of dollars that Congress appropriated for foreign aid." She continued, "Deciding the question presented thus requires the Court to work in uncharted territory. And, to repeat, the stakes are high: At issue is the allocation of power between the Executive and Congress over the expenditure of public monies."
Kagan’s dissent went further, emphasizing the constitutional principle at stake: "But that is just the price of living under a Constitution that gives Congress the power to make spending decisions through the enactment of appropriations law." She argued that the result of the emergency order conflicts with the "separation of powers" enshrined in the U.S. Constitution, which is designed to ensure that no branch becomes so powerful that it overwhelms the others. As DW noted, the "power of the purse" has long been regarded as a core congressional prerogative.
The impact of the aid freeze, however, reaches far beyond the halls of government. Humanitarian groups and researchers have warned that the cuts could have dire consequences for millions of people in developing countries. According to a July 2025 study by the Fielding School of Public Health at the University of California, Los Angeles, the aid reductions could result in more than 14 million additional global deaths by 2030. The International Rescue Committee (IRC) has also sounded the alarm, pointing out that ending disease prevention and treatment programs increases the risk of global health crises. "Without prevention and treatment efforts, diseases are more likely to spread unchecked, mutate and become harder to control," the IRC stated on its website. "This creates a higher risk for future global health crises that could threaten lives worldwide."
The legal journey of the case has been complex and fast-moving. In early September 2025, U.S. District Judge Amir Ali ruled that the administration’s refusal to spend congressionally approved funds likely violated federal law, and that only Congress could rescind the funding. However, a three-judge panel on the U.S. Court of Appeals for the District of Columbia Circuit later ruled that the nonprofits and businesses could not sue on separation of powers grounds, though it left open other legal avenues. The Trump administration, dissatisfied with the lower court’s injunction, appealed to the Supreme Court, with Solicitor General D. John Sauer arguing that the injunction "raises a grave and urgent threat to the separation of powers."
Democratic members of Congress, including House Appropriations Committee ranking member Rosa DeLauro and Senate Appropriations Committee ranking member Patty Murray, have sharply criticized the Supreme Court’s decision. In a joint statement, they called on their Republican colleagues to defend Congress’s authority over federal spending. "Congress can—and absolutely should—promptly reject President Trump and Russ Vought’s illegal effort to do an end run around the people’s elected representatives by passing a bill like the one we introduced last week," they wrote, urging bipartisan action to uphold the institution’s power of the purse.
As the legal and political battle continues, the fate of billions in U.S. foreign aid—and the core constitutional question of who controls federal spending—remains uncertain. For now, the Supreme Court’s decision stands as a stark reminder of how the separation of powers can be tested in moments of national and global consequence.
