Bloomberg Audio Studios, podcasts, radio news. Since his first day in office, President Donald Trump has taken aim at the US Agency for International Development, better known as USAID. The whole thing is a fraud, very little being put to good use. First came his executive order on January twentieth, putting a ninety day freeze on foreign assistance funded through the agency. Thousands of USAID personnel were put on administrative leave.
Ngngos and contractors around the world who get funding or work with USAID staff scrambled to make sense of the order. But last week a federal judge halted Trump's order to put USAID workers on leave. We've also seen at least two other federal judges block broader attempts at freezing federal funding. As the battle over USAID's future heats up, Bloomberg reporter Simon Marx, who's based in Nairobi, says the ripple effects are already palps.
A lot of people in Kenya are hopeful that some of this funding can be re established, but in a period where there's a lot of doubt, people are just putting the brakes on. So the reality on the ground is that the programs have stopped basically.
After the news of Trump's order first broke, Simon visited a health clinic in Naerobi. One of the clinic's main jobs is distributing drugs to combat HIV. More than one point two million people in Kenya are being treated for the virus. Preventing its spread, managing symptoms, and combating stigma are all crucial tasks that the clinics staff perform.
When we arrived at the Matari North Health Center, as we walk through the doors, there was an emergency meeting ongoing with state Civil servant staff.
So that's what I say, and fourteen fels to man.
And they were essentially grappling with the huge fallout from the USAID cuts. Seventeen staffers been let go. They were in a sort of state of semi crisis and disbelief.
On the days Simon visited, many of the clinics staff didn't show up for work. They had been told that given Trump's order, they may not be paid.
I met one nurse who said, on the first day of these cuts, she was already doing a double shift and couldn't go back to see her family.
The one nazis HD years, the ones who do their testing in.
Such and some of the staff worry because there had been a long queue of HIV patients line up looking for the anti retroviral drugs in a state of panic.
Those Spiciens come visically.
When they arrived, there was no one to administer those drugs.
While Washington fights over USAID's future, the reality and communities that rely on its funding is already shifting. For the people who rely on USAID funded clinics, this faraway debate in Washington can have even life or death consequences. From Bloomberg's Washington bureau, This is the Big Take DC podcast. I'm Saleamosen today on the show the ongoing battle over USAID and what the turmoil could mean for communities on
the ground and American influence abroad. To understand the fight over USAID, I sat down with Bloomberg's National Security editor Nick Wattams. Nick, let's start big picture. What is USAID.
USAID is the US Agency for International Development. It's sort of under the umbrella of the State Department, but it's also an independent federal agencies. And these are the guys who distribute food aid in times of disaster and crisis overseas. They also do anti HIV programs all across the continent of Africa and elsewhere. It's also a way to prevent pandemics. So USAADA is involved in diase tracking in a lot of countries, particularly in Africa, and they launch vaccination campaigns.
They also give farmers advice and instruction on how to plant crops better in situations where there's drought. So a whole range of operations that go from immediate disastered relief to sort of broader cultural exchange and community programs. And the annual budget is about forty billion dollars a year.
So how did the US become such a critical source of international aid here?
Overall? When you speak about pure dollars, the US contributes more foreign aid overseas than any other country in the world. When you talk about it as a percentage of GDP, the US is actually very very far down the list. But there is also a very heavy soft power component, so trying to use civil society programs, libraries, interaction with people often poor pus in these countries as a way to extend SELT power and get people to like them.
And there's a geo strategic element there of doing competition with China, get people to like the US more than they like other countries.
Trump took action essentially to freeze the organization. Explain what he did.
President Trump essentially shut down USAID entirely through the State Department and also through some of his executive orders put a blanket freeze on US foreign aid, with some exceptions for life saving treatments, so all of those programs were halted. There are about ten thousand people who work for USAID. That includes Americans foreign service officers, but also local staff
and countries all around the world. They basically put all the Americans they could on administrative leave, so paying them but telling them not to come to the office, and then did even very symbolic things like they took the name US Agency for International Development off of the building where it's headquartered. People were cut off from their email accounts, finding it impossible to communicate or even to get direction. So within a very short period of time, they basically ground USAID.
To a halt. And what's the ultimate goal that Trump has presented for doing all of this?
His claim and Elon Musk's claim because his DOGE group has been central to the work to freeze USAID. What they claim is that USAID became a hotbed for some of the DEI and progressive leaning initiatives that they really want to get rid of. They also claimed that USAID had essentially become a rogue agency where people were implementing these programs and despite being told to stop, were refusing
to do so. We had one report where USAID staff were brought into a room with some of the political appointees who had been brought in and were told, listen, we know you're funding abortions, we know you're funding transgender surgery. You need to come clean on that and stop hiding it. And their response was, we do not do that. That's not part of USAID's remit. And the response was essentially,
we know you're lying. And then they also just more broadly went through USAID's accounts and said that there was a ton of waste and fraud in there where they felt that those programs were ineffective, weren't going to produce anything, and so sort of cast it both as a rogue agency and also as an agency that was spending money in a wasteful way.
Nick, why is Trump taking aim at this agency? In twenty twenty three, USAID's budget made up about one point two percent of overall government spending.
There are several things happening here. One is that it's an easy target. They do have programs focused on priorities of democratic administrations, such as climate change, transgender rights, outreach
to LGBTQ communities. It's also a small target. If DOGE and President Trump are going to go after the Pentagon, for example, or Treasury or a bigger agency, that's going to be a bigger challenge because there are just so many more people and so many more equities involved from folks who may have a stake in keeping those agencies alive.
But it also reflects a bigger issue, which is that President Trump and a lot of Republicans, particularly those involved in Project twenty twenty five, want to get away from this idea of aid for aid's sake, so you put grain on a ship and it goes and helps a community that's suffering from a catastrophe. They want aid that's more economically driven, public private partnerships, where you have US companies or you have an investment driven model rather than a pure aid model.
So Elon Musk is helping the president assess government agencies, and he came out and called USAAD evil. Do we know what his involvement was in the decision.
Initially, what happened was that he deployed several people to USAID to try to essentially gain access to its computer systems, and there was a standoff early on where they tried to get access to classified information in a secure area of USAID and two security employees tried to stop them, and there was actually a confrontation where they said, you can't come in here. You don't have the appropriate clearances. This is not legal, and they were essentially told that's
not the case. We do have the right clearances, and those people were essentially swept aside. So Doge was involved in this from the very beginning. But then there came to be this huge online pileon where people were going through all of USAID's records in terms of what it spent, because this is all public information. I mean, USAID broadcasts to the world on its website well before the website
got shut down, all the programs it does. So then there was this pilon where Netizin's citizens sleuths were sort of going going through USAID's books and pointing out programs that they felt were inappropriate or irrelevant, So it had the snowball.
Effect after the break. What the legal challenges to Trump's actions could mean for USAID's future, and what a world without American leadership on humanitarian aid could look like. Nick, you and I covered the first Trump term together. We kind of know a little bit about reading the tea leaves of how different actions reveal something about how decisions
are made in the White House. What can you tell us about how Trump is getting advice and what kinds of conversations you think might be happening inside the administration over USAD and what it tells us about how they might handle other agencies.
One of the things about USAID that's so fascinating, and I've had sources at USAID for years. USAID was a tool under the first Trump administration, particularly through Trump's daughter Ivanka, who launched federally funded women's programs using USAID. So at that time, the Trump administration in the first term saw value in USAID. Obviously that's changed. He's essentially given Doge and his lieutenant's free reign to do what they want
to this agency. The other issue that's really fascinating to me is there may be a legal battle over whether USAID as a congressionally mandated agency can be destroyed in this way. But what do you do when you essentially put people in charge of the agency who believe it
should be destroyed. So you can have a court say yes, USAID should stay in existence, but then you install staff at the top of the agency who essentially want to make it defunct, so it becomes almost like a zombie agency where it's the only people who are being allowed to report to work are staff who believe it should
not exist. So we still haven't seen how that's going to play out because courts have so far tried to block the President from essentially putting the entire agency on administrative leave, but that appears to be what their strategy is, and.
What are you watching for next in that case.
It'll be interesting to see what happens in terms of whether the administration agrees to essentially put people back to work as courts have ordered. You're also going to start to see some real aftershocks here, and it'll be interesting to see what happens with Congress and how much pressure
they bring to bear. A huge element of what USAID does is it buys often surplus crops from US farmers hundreds of millions of dollars worth of crops, puts those on ships and sends them to disaster zones or places in need. A lot of those shipments have been suspended or are in limbo or in the process of being canceled.
We've seen some rumblings from my senator in Kansas, for example, where they have constituents, they have farmers who are not getting paid or who are watching these crops get spoiled while they await pickup. We've seen some indication that they're willing to speak up a little bit on X, but really not go to battle with the Trump administration. And then the final one I would say is just does
this cost cutting actually work. There's some indication that it will actually be more expensive to the US taxpayer to defund the USAID because you have all of these staff overseas they are now going to need to be brought home. You have contracts that have to be canceled. There are going to be lawsuits, There's going to be millions and
millions of dollars in US government assets all overseas. So you could see a scenario where the financial waste from destroying USAID actually in the end comes to cost more than the cuts that they had envisioned.
Nick, at the start of our conversation, you mentioned the soft power element and how usad's work also benefits America in certain ways. What kind of soft power vacuum do you think could be created globally?
I think that's a very real concern. I mean, this has fit a broader approach by the Trump administration that it seems very clear they don't believe in soft power the way that successive administration is basically dating back to the Cold War believed in. You have USAID and a lot of these countries providing life saving food and medicine, and very intentionally, a lot of the sacks that carry that grain or the cans of food, whatever it may be,
are labeled with American flags or USAID. So there's a direct correlation that the US government has been very intentional about that, says, Hey, it's the United States government that's providing this. So the absence of that obviously gives other countries like China the opportunity to step into the gap. But then there's also just the negative effects. Hey, we were dependent on the United States and then they pulled out we don't see them anymore. They abandoned us.
What could that mean for American influence the longer term?
Well, if you're foreign government and the US comes and says, okay, we have all of this aid we want to give to you, but as part of our conversations, we also want to share our values or expect a certain adherence to values. And then the US is suddenly out of that situation. You have another country that doesn't put as much of a priority on those issues or actively opposes some of those issues. Maybe it's climate change, maybe it's LGBTQ issues, and so that silence will be filled by others.
So that's the real concern there.
Well, Nick, thanks so much for joining in unpacking all of us with me.
My pleasure.
On Tuesday, President Trump and Elon Musk held a press conference in the Oval Office, and they doubled down on their critiques of usaid.
But overall, you say, what does the bank of the buck? I would say it was not very good.
As I said, much as incompetence and much as dishonesty.
We have to catch it.
On Wednesday, Bloomberg reported that the President's advisors have discussed moving usaad funds to a government run agency created during Trump's first term. That agency, the US International Development Finance Corporation, uses taxpayer dollars to invest in private sector projects overseas. It's set to be run by the son of private equity investor Leon Black and Today, protesters disrupted a congressional hearing over USAID spending, calling for a full restoration of
money for AIDS treatment. A Republican and congressmen rebutted, saying that funding was exempt and had already been restored, something that several AID groups disputed, and with other court rulings on the horizon, the battle continues. This is the Big Take DC from Bloomberg News. I'm Salaia Moosen. This episode was produced by Julia Press. It was edited by Aaron Edwards, Greg White, and Ian Marlow. It was fact checked by Audreyan Atapia and mixed and sound designed by Alex Sugira.
Our senior producer is Naomi Shaven and our senior editor is Elizabeth Ponso. Our executive producer is Nicole Beemster Bower. Sage Bauman is Bloomberg's head of Podcasts. If you liked this episode, make sure to subscribe and review The Big Take DC. Wherever you listen to podcasts, it helps new people find the show. Thanks for listening.