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Recently, the administration of President Trump issued an executive order to freeze all federal grants and offered federal workers the option to resign from their positions with eight months’ pay in an effort to downsize the government. These actions caused concern nationwide and have the potential to impact an already struggling housing market, further delaying progress towards safe, affordable, and equitable housing for many Americans.
U.S. District Judge Loren L. AliKhan intervened, leading the administration to rescind the order within 24 hours as federal employee unions stepped in to address the mass severance offer.
(Editor’s note: White House Press Secretary Karoline Leavitt clarified that OMB’s memo rescinds the initial memo, not the freeze. The possibility of a freeze remains uncertain unless a court order prevents it until Feb. 3.)
While it’s common for new administrations to review federal spending, the nature and impact of this specific review are unprecedented, potentially freezing essential funds that many households rely on for survival. In this article, we’ll explore how these orders are expected to affect the economy, housing, and safety for numerous households.
Impact on Non-Profit Organizations
Non-profit organizations nationwide that rely on grant funding to offer services not covered by private or government entities are at risk of losing future funding. These organizations provide crucial services such as education, food programs for low-income individuals, domestic violence shelters, refugee programs, mental health support, and many more. If funds are cut, these organizations and the populations they support could face uncertainty and challenges.
President and CEO Diane Yentel of the National Council of Nonprofits issued a statement acknowledging the reversal of the memo but also expressed concerns about lingering uncertainty.
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Mass Federal Job Elimination and Community Impact
The White House’s proposal for federal job cuts could result in 10% of the 2 million federal workers opting for resignation, potentially causing chaos and hardships in the job market. As the Feb. 6 deadline approaches for federal workers to decide their future, communities reliant on federal worker incomes may face challenges if a significant number leave their jobs.
The consideration of eliminating certain departments, such as FEMA, could have lasting impacts on communities that depend on these job sites.
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Consequences on Housing and Social Wellbeing
The proposed changes and uncertainty in federal policies could exacerbate the already high cost of living and contribute to the decline in overall happiness and prosperity in the United States. The future of homeownership, equity, and support systems for vulnerable populations is at risk, potentially leading to housing instability and crises for many Americans.
As the market and social issues are interconnected, the administration’s decisions could have far-reaching consequences for the future of American society and its pursuit of prosperity and happiness.
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Rachael Hite is a respected housing counselor and industry thought leader with a wide-ranging expertise in business journalism, retirement housing, and affordable housing initiatives. Connect with Rachael on Instagram and Linkedin.
