In a move that has sent shockwaves through Washington, President Donald Trump has invoked a rarely used executive maneuver to block $4.9 billion in congressionally approved foreign aid, setting off a fierce debate over presidential power and the future of U.S. assistance abroad. The decision, announced in a letter to House Speaker Mike Johnson on August 28, 2025, and posted publicly the next morning by the White House Office of Management and Budget, marks the first use of a so-called "pocket rescission" in nearly half a century.
For those unfamiliar with the term, a pocket rescission is a procedural tactic that allows the president to propose the cancellation of funds that Congress has already approved. By submitting the request near the end of the fiscal year—which wraps up on September 30—the administration effectively prevents Congress from acting within the 45-day window required to approve or reject the rescission. As a result, the money simply goes unspent, slipping quietly out of reach as the clock runs out. According to reporting by The Associated Press and The Economic Times, the last time a president used this maneuver was in 1977, under Jimmy Carter.
The funds targeted by Trump’s pocket rescission are significant: $3.2 billion earmarked for development assistance grants, $520 million for the United Nations, $838 million for international peacekeeping operations, and $322 million to support democratic values abroad. All of this money had been allocated through the State Department and the U.S. Agency for International Development (USAID). The administration’s move is the latest—and arguably the boldest—in a series of deep cuts to foreign aid, a hallmark of Trump’s policy agenda since returning to office. USAID, once the primary vehicle for U.S. development assistance, has been largely dismantled, with remaining programs folded into the State Department.
Supporters of the pocket rescission argue that it is a legally permissible tool under the 1974 Impoundment Control Act. This law gives the president authority to propose canceling funds, but Congress must act within 45 days to approve or reject the proposal. By timing the request so close to the end of the fiscal year, the Trump White House contends that the funds will lapse before Congress can respond, making the cancellation a fait accompli. As a White House official told reporters on background, the administration is confident it would prevail in any legal challenge and aims to make "the cleanest case possible for these types of clawbacks."
Not everyone shares this view. The move has drawn immediate and sharp criticism from both sides of the aisle in the Senate. Senator Susan Collins of Maine, a Republican, did not mince words: "The Constitution makes clear that Congress has the responsibility for the power of the purse, and any effort to claw back funds without congressional approval is a clear violation of the law." She called for spending reductions to be made through the "bipartisan, annual appropriations process," not unilateral executive action. Senate Democratic Leader Chuck Schumer of New York went further, warning that Trump’s use of the pocket rescission could undermine the normal funding process and risk "a painful and entirely unnecessary shutdown." Schumer accused the administration of trying "an unlawful gambit to circumvent the Congress all together."
Legal experts are also weighing in. Eloise Pasachoff, a law professor at Georgetown University and an authority on federal spending, wrote in an academic paper last year that the Impoundment Control Act’s language "admits no exceptions, indicating that Congress expects the funds to be used as intended before the end of the fiscal year if it does not approve the proposed rescission." In other words, Pasachoff argues, the White House cannot unilaterally decide to withhold funds simply by running out the clock.
The timing of the pocket rescission is no accident. With the fiscal year drawing to a close, Congress faces a compressed timeline to respond—not just to the rescission, but also to the broader challenge of keeping the government funded. As The New York Post first reported, the White House’s maneuver could set a precedent that allows future presidents to bypass Congress on key spending decisions, potentially shifting the balance of power between the legislative and executive branches.
This latest episode is only one front in a broader struggle over control of federal spending. The Trump administration has repeatedly tested the boundaries of executive authority, from firing federal workers to imposing tariffs without congressional approval. The courts have become the battleground for these disputes, with mixed results. On August 28, 2025, the full U.S. Court of Appeals for the District of Columbia Circuit declined to rehear a case that would have stopped the administration from withholding billions in foreign aid. The next day, the administration withdrew its emergency request to the Supreme Court, having secured a favorable ruling from a three-judge panel that found only the Government Accountability Office, not private aid groups, could challenge the use of the Impoundment Control Act.
Yet the appeals court’s decision left the door ajar for further legal challenges. Judge Brad Garcia, appointed by President Joe Biden, noted in a separate statement that the revised order "allows that claim to proceed," meaning aid groups could still challenge the administration’s actions in district court. Judge Patricia Millett, another Democratic appointee, joined Garcia’s statement, suggesting that the separation-of-powers issues at stake remain unresolved. Judge Florence Pan, also appointed by Biden, dissented more forcefully, calling the case "a textbook separation-of-powers claim" and warning that the decision "creates a circuit split on an issue that is likely to recur."
While the legal wrangling continues, the practical impact of Trump’s action is immediate. Billions of dollars in aid for development, peacekeeping, and global health are now frozen, with ripple effects likely to be felt by vulnerable populations around the world. Advocates for foreign aid warn that the cuts could damage America’s reputation and undermine efforts to promote stability and democracy abroad. The administration, for its part, insists that the rescission is both lawful and necessary to rein in what it sees as wasteful spending.
As the fiscal year draws to a close, lawmakers and aid organizations are scrambling to respond. The outcome of this battle will shape not only the fate of billions in foreign assistance, but also the contours of executive power for years to come. With Congress and the courts still at odds over who holds the purse strings, the debate over the pocket rescission is far from over.
For now, the White House’s bold use of a nearly forgotten tool has reignited a fundamental question at the heart of American government: Who really decides how the nation’s money is spent?
