May 6, 2025
President Trump has only been in office since January, but he's already made a number of significant changes. One of them was halting funding for foreign aid programs.
Specifically, Trump initiated a 90-day freeze on the U.S. Agency for International Development, or USAID, which aims to reduce poverty, fight disease and address humanitarian needs in foreign countries.
Advertisement
By Feb. 4, his administration announced that nearly all 10,000 USAID employees were being put on leave and that those working overseas would be recalled.
While a federal judge halted the move, the block was only temporary.
As of March 10, The Guardian reported that the Trump administration has officially eliminated 83% to 90% of USAID's programs. Most recently, funding to the U.N. World Food Program was cut, which helped millions in 14 countries, including Syria, Yemen and Afghanistan. It's unclear which programs remain, but the State Department will be administering them.
Halting foreign aid clearly hurts overseas communities, but the impacts have hit hard domestically, too.
In fact, halting aid is already hurting U.S. farmers.
Advertisement
As Kansas farmer Vance Ehmke told ABC News, “We are having a real crisis out here in terms of income."
Why they’re now struggling
The Trump administration’s decision has resulted in the stoppage of critical supplies to at least 177 countries. But the impact isn't limited to USAID recipients. Local U.S. suppliers of food and other resources have lost a share of their income.
That includes Vance Ehmke and his wife, Louise. Their farm produces grain that gets shipped overseas. And if the program goes away completely, they, and many farmers like them, will be at a loss for income.
"USAID annually buys about $2 billion of surplus and commodities like wheat and grain," Vance told ABC News. "There's a very valuable market that's vanished."
The Ehmkes aren't the only ones losing income in light of the USAID freeze. USAID contractors are said to have reported laying off nearly 13,000 American workers — though the number could be much larger.
Must Read
- Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake — are you doing the same?
- Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how
- Robert Kiyosaki says this 1 asset will surge 400% in a year and begs investors not to miss this ‘explosion’
Join 250,000+ readers and get Moneywise’s best stories and exclusive interviews first — clear insights curated and delivered weekly. Subscribe now.
Far-reaching consequences
Cutting off aid to foreign countries could have a massive impact on international relationships. But that aside, it could cause a world of unfavorable consequences domestically.
Advertisement
USAID doesn't just send supplies overseas. It also, as the Ehmkes explain, helps fund a lot of research — research that’s critical to preserving the U.S. food supply.
As Louise explained, farmers need drought-resistant crops. But they can't do that sort of research on their own. In the absence of research, the U.S. food supply could be threatened by extreme weather events, which have increased in frequency in recent years due to climate change.
For example, a University of Illinois Urbana-Champaign lab working to expand soybean usage has now been shutdown because of a lack of funding. And that's just one of many food labs reliant on grant money from USAID for critical research.
Farms may also have to raise prices to compensate for their lost income if they lose out on their USAID contracts. That could drive food prices up across the board.
Advertisement
As of March, food prices were up 3.0% annually, per the Consumer Price Index. Given that 70% of Americans are already struggling to cover the cost of groceries, according to Swiftly, a rise in food prices would only exacerbate the problem.
And even if local farmers raise prices, that may not be enough to compensate for lost USAID contracts. This means that farmers across the country risk struggling financially or, in a more dire scenario, falling into poverty.
More than 80% of companies with USAID contracts are American, according to data company DevelopmentAid. So, this decision has the potential to spur an unemployment crisis.
For Vance Ehmke, the concern is twofold. He's worried about his family's livelihood and the wellbeing of in-need communities overseas.
"We do have a humanitarian and a moral obligation to help, you know, get food to these food-deficient areas," he said.
You May Also Like
- Turning 50 with $0 saved for retirement? Most people don’t realize they’re actually just entering their prime earning decade. Here are 6 ways to catch up fast
- Inside a $1B real estate fund offering access to thousands of income-producing rental properties — with flexible minimums starting at $10
- Vanguard’s outlook on U.S. stocks is raising alarm bells for retirees. Here’s why and how to protect yourself
- Here are 5 easy ways to own multiple properties like Bezos and Beyoncé. You can start with $10 (and no, you don’t have to manage a single thing)
Maurie Backman has been writing professionally for well over a decade. Since becoming a full-time writer, she's produced thousands of articles on topics ranging from Social Security to investing to real estate.
