USAID is in freefall, and the consequences for global humanitarian efforts are dire. While the world grapples with the devastating impacts of the recent U.S. foreign assistance freeze, a concurrent and equally alarming crisis is unfolding within the very agency tasked with managing it: USAID itself. As the world’s largest bilateral aid donor, USAID’s ability to function is paramount. However, this blog will expose how a combination of a crippling funding freeze, a systematically dismantled digital infrastructure, and a decimated workforce, as detailed in the January 28th directive and subsequent reports, have brought the agency to its knees. This is not just an internal administrative problem; it’s a systemic, possibly illegal dismantling of a vital U.S. agency, with potentially catastrophic consequences for millions of vulnerable people worldwide.
- We will delve into the deliberate dismantling of USAID’s online presence, explore the widespread furloughs and leadership vacuum crippling its operations, and analyze the breakdown of essential digital systems like the DIS, DEC, and DDL.
- Further, we will examine the incredibly complex and ultimately obstructive waiver process, highlighting how its byzantine requirements and multi-layered approvals are causing devastating delays in the delivery of life-saving assistance.
- This will be illustrated through detailed examples, including a case study of Northeast Syria, where the abrupt cessation of aid is creating a humanitarian time bomb with regional and global security implications.
- Finally, we’ll expose the devastating impact on implementing partners, including the looming threat of organizational collapse due to the ensuing cash-flow crisis.
This isn’t just an internal administrative problem; it’s a systemic failure with potentially catastrophic consequences for millions of vulnerable people worldwide. Whether by design or incompetence, the outcome is the same: a dangerous weakening of the U.S. foreign aid system. This blog will lay bare the crisis, explore the factors contributing to it, and issue an urgent call to action to save USAID and the vital work it supports.
A Shattered Digital Presence and Political Overhaul
In a dramatic turn of events, the official USAID website is now offline, with only a barebones front page hosted under the State Department. Previously, USAID.gov provided a comprehensive “Resources for Partners” section—including pages on private sector engagement, compliance, and detailed system links—but these critical components have disappeared. This move, widely reported by CNN and AFP, appears to be part of a broader effort to dismantle the agency’s independent identity. Elon Musk recently claimed in an X Spaces conversation that President Donald Trump agreed USAID should be shut down—a sentiment echoed by Trump himself, who described the agency as being “run by radical lunatics.”
Adding fuel to the fire, on February 3rd, a leaked email from within USAID revealed that all agency personnel were instructed not to report to the Washington, D.C. headquarters, ostensibly due to a directive from “Agency leadership.” This coincides with recent public statements where a prominent tech executive claimed that the agency had been shut down, further raising concerns about a coordinated effort to dismantle USAID. This email was sent by Gavin Kliger from a usaid.gov email, who according to a WIRED investigation, is one of a group of young engineers, many with ties to this tech executive’s companies, who are now in key positions within the government, as part of the so-called Department of Government Efficiency (DOGE).
Internal Upheaval: Furloughs, Leadership Vacuum, and the Purge of PSCs
Recent reporting from Devex, Politico, and other sources confirms that hundreds of senior USAID officials, including key leaders in the legislative and public affairs units, have been placed on administrative leave or furloughed. Nearly 40% of the Bureau for Humanitarian Assistance’s (BHA) workforce is now sidelined. This loss of experienced personnel is creating a leadership vacuum and severely undermining USAID’s capacity to manage its global humanitarian response at a time when it is needed most. The situation is further exacerbated by the following:
- Senior Leadership on Leave: Top security officials—such as USAID’s Director of Security John Voorhees and his deputy—were placed on leave after refusing DOGE personnel access to classified areas. This incident, reported by CNN and corroborated by AFP, highlights deep internal conflicts as Trump-appointed DOGE teams attempt to exert control.
- Decimated Communication Teams: Key groups responsible for liaising with Congress and managing external communications have been gutted, leaving USAID’s ability to advocate for its mission and respond swiftly to emerging crises in disarray.
- Lack of Clarity on Working Status: Most BHA and USAID staff placed on leave were blocked from their emails before they could even put an out-of-office message on. As a result, implementing partners are sending in requests for information without knowing that their emails will not be read, and that no actions are being taken on them.
- The Purge of PSCs: It has been reported by several sources that on Sunday evening of the 2nd of Febuary, without any prior notice, all Personal Service Contractors (PSCs) had their email and network access terminated. PSCs are not merely administrative staff; they are the backbone of many USAID operations, particularly in BHA, where they constitute roughly half the workforce. They are individuals contracted directly by the agency to perform a wide range of services, often filling critical roles that would otherwise be held by direct-hire government employees. They are the individuals legally responsible for making, managing, and overseeing over 1000 awards to relief agencies. They lead response teams, plan operations, deploy overseas, and handle essential coordination within and beyond the U.S. government. This action, which reportedly includes staff working on urgent awards for Gaza, is not just disruptive; it’s a deliberate crippling of USAID’s ability to function.
It is being report that this multi-pronged attack on USAID’s workforce—through furloughs, the targeting of senior leadership and communication teams, and now the wholesale termination of PSC access—has effectively paralyzed the agency, rendering it incapable of fulfilling its mission at a time of unprecedented global need.
Digital Systems in Breakdown
The internal staffing crisis is compounded by the disruption of USAID’s critical digital infrastructure:
USAID.gov Under State Department Control: What We Know
- Before Last Week: USAID.gov served as the central hub for comprehensive “Resources for Partners.” It included detailed sections on private sector engagement, compliance, and tools such as the IPN Portals, ADS, and other internal systems that were essential for effective collaboration with USAID.
- What We Know Now: Recent observations show that the official USAID website is no longer operating in its complete form. Instead, only a rudimentary front page is now hosted under the State Department. Many key sections—including detailed partner resources and internal system links—are missing or inaccessible.
- What We Assume This Means: We assume this change is part of a broader effort to consolidate foreign assistance information under the State Department’s control. The removal or restructuring of detailed resource hubs likely signals an attempt to control messaging and centralize oversight, but it further hampers partner communication and operational continuity.
USAID Digital Front Door (DFD):
- Before Last Week: The DFD was the central online portal that allowed implementing partners to submit digital reports, performance data, and supporting documents. It streamlined communication and ensured that data was submitted in a standardized and timely manner.
- What We Know Now: Although the DFD remains online, it now operates in isolation. With key IT support and troubleshooting personnel furloughed, coordination is severely diminished, which is hindering real‑time decision‑making. (Source: Reuters, Time.com)
- What We Assume This Means: We assume that the reduced functionality of the DFD will lead to delays in data submission and a breakdown in communication between USAID and its partners. Without effective support, resolving technical issues becomes a major bottleneck.
Development Information Solution (DIS): https://dis.usaid.gov/
- Before Last Week: DIS was introduced in 2018 as an enterprise‑wide portfolio management system. It integrated program funding, award details, and development results into a unified reporting ecosystem that was central to USAID’s operations.
- What We Know Now: DIS was officially terminated on January 31, 2025, with no clear guidance issued on what system should replace it.
https://disreporting.usaid.gov/
- What We Assume This Means: We assume that the termination of DIS creates a significant gap in USAID’s capacity to track and manage its extensive portfolio. This loss of a unified system likely leads to increased operational chaos and uncertainty in reporting and program management.
Development Experience Clearinghouse (DEC) - https://dec.usaid.gov/
- Before Last Week: Established in 1975, DEC was USAID’s primary repository for over 168,000 documents—ranging from technical reports and evaluations to project materials. It served as a vital historical resource for staff, partners, and researchers.
- What We Know Now: The DEC website now displays a message stating that the resource is temporarily unavailable, indicating that the platform is offline.
- What We Assume This Means: We assume that the unavailability of DEC restricts access to decades of valuable development data and lessons learned. This loss hampers the ability of USAID staff and partners to reference historical insights when making informed decisions under crisis conditions.
Development Data Library (DDL) - data.usaid.gov
- Before Last Week: Launched in 2014, the DDL served as USAID’s public repository for agency‑funded, machine‑readable data. It provided standardized datasets that underpinned evidence‑based programming and rigorous evaluations, benefiting both internal and external stakeholders.
- What We Know Now: The DDL website currently shows a notice that it is undergoing maintenance in accordance with the President’s Executive Orders, meaning the platform is temporarily offline. (Source: DDL website notice, 2025)
- What We Assume This Means: We assume that this temporary shutdown restricts access to critical datasets, affecting both internal evaluations and external accountability efforts. This disruption undermines USAID’s ability to monitor program performance and adjust strategies in real‑time.
FEWS NET: What We Know
- Before Last Week: FEWS NET was the leading provider of early warning and analysis on food insecurity, operating in over 35 countries. It utilized a vast network of data—satellite imagery, field reports, market data, and expert analysis—to produce objective, evidence-based forecasts that informed humanitarian responses and helped prevent famines. They were the gold standard in providing early warning and analysis on current and future food security conditions.
- What We Know Now: The FEWS NET website, along with its Learning Platform, Data Warehouse, and Data Explorer, are currently unavailable, displaying the notice shown below. This outage, coupled with USAID funding cuts, staff furloughs, and the broader agency upheaval, severely restricts access to critical, time-sensitive data and analysis used by decision-makers.
- What We Assume This Means: We assume this outage, along with the broader USAID crisis, will significantly degrade FEWS NET’s ability to monitor and forecast food insecurity. Reduced funding, hampered data access, and weakened collaboration with partners likely mean slower, less accurate early warnings, diminished analytical capacity, and ultimately, a compromised ability to prevent and respond to food crises worldwide. The current administration has been clear on its intention to cut all funding for climate change related activities, this includes the climate data that FEWS NET relies on for its analysis.
Consequences for Implementing Partners
The internal chaos at USAID has a direct and immediate impact on implementing partners. Organizations on the ground are left to navigate this crisis with limited support, facing:
- Communication Breakdowns: With key staff furloughed and systems offline, communication with USAID has become increasingly difficult.
- Bureaucratic Hurdles: The already complex process of managing awards and seeking waivers is now further complicated by the agency’s internal disarray.
- Lack of Access to Essential Data: The inability to access historical project information, performance data, and geospatial tools severely hinders program implementation and decision-making.
The Broader Implications
This internal dismantling of USAID’s capacity is not happening in isolation. It’s a direct consequence of the administration’s funding freeze, and the changes within USAID raise serious questions about the motivations and priorities behind these decisions. The consequences of this deliberate disruption extend far beyond the agency itself, impacting millions of vulnerable people worldwide and undermining decades of development progress.
The Need for Transparency and Accountability
The situation at USAID demands immediate transparency and accountability. The administration must explain the rationale behind these internal changes and outline a clear plan for restoring the agency’s capacity to manage the ongoing crisis. Implementing partners, Congress, and the American people deserve answers.
The Waiver Process: A Bureaucratic Labyrinth with Crippling Delays
The recently announced humanitarian waiver, intended to allow the continuation of “life-saving” assistance, has proven to be anything but a straightforward solution. The process for obtaining a waiver is a bureaucratic labyrinth, fraught with delays, uncertainty, and a level of complexity that further jeopardizes already vulnerable populations. While the remaining Contracting Officers (COs) and Agreement Officers (AOs) at USAID are dedicated professionals committed to fulfilling their duties, the reported termination of Personal Service Contractor (PSC) access has created a severely constrained environment. COs and AOs are direct-hire U.S. government employees with the legal authority to bind the government in contracts and agreements. They are the only ones who can officially approve waivers.
However, they relied heavily on PSC support to manage the substantial workload associated with processing these waivers. With the PSCs gone, the system, even with the best intentions and most tireless efforts of the remaining staff, will face significant bottlenecks and delays. It’s not that waivers are likely to fail outright; it’s that the process, which was already slow, will now take a substantial amount of time, potentially extending towards the end of the 90-day stop-work order before any clarity is achieved. This delay will have devastating consequences for those awaiting life-saving assistance.
Understanding the Roles in the Waiver Process
Before delving into the steps, it’s crucial to understand the key personnel involved:
- Contracting Officers (COs) and Agreement Officers (AOs): These are direct-hire U.S. government employees, appointed and warranted under FAR subpart 1.6 and related USAID warrant programs. They possess the legal authority to negotiate, award, administer, modify, and close out contracts, grants, or cooperative agreements on behalf of the U.S. Government. They are the only ones who can officially approve waivers. They enjoy the full range of federal employee benefits and protections.
- Personal Service Contractors (PSCs): These individuals are engaged through personal services contracts. While they are treated like employees for tax purposes and may perform many duties similar to government employees, they are NOT government employees. They do not have the authority to bind the government in contracts or agreements. Their roles are defined by their contracts, and they often provide crucial support to COs and AOs, including in the processing of waivers. With their reported termination, this vital support function is eliminated.
Step-by-Step: How the Waiver Process (Doesn’t) Work
1. Blanket Stop‑Work Order
What We Know: On January 25, 2025, USAID issued a blanket stop-work order that halts all USAID-funded activities. This stated that no new funds can be spent, and ongoing work must be suspended until a waiver is formally issued.
What We Assume: We assume that this order is uniformly applied across all contracts, grants, and cooperative agreements—even if a program might later qualify for a waiver.
2. Individual Waiver Approval (No Automatic Waivers)
What We Know: A limited waiver for “emergency food assistance, emergency NFI, and life‑saving humanitarian assistance” has been announced (as evidenced by the recent PEPFAR waiver notice). Implementing partners are required to review their awards and identify eligible components.
What We Assume: We assume that every organization must conduct an internal review of all active USAID awards to identify which budget lines or activities qualify as “life‑saving.” We assume that organizations will compile a detailed waiver proposal specifying the percentage of funds dedicated to these critical activities.
3. Multi‑Tiered, Lengthy Approval Process
What We Know: The waiver proposal should be submitted via USAID’s central digital system, though many organizations are now forced to use email due to system outages. The proposal undergoes several layers of review—from regional and headquarters staff up to Bureau‑level approval and, possibly, sign‑off by the Secretary of State.
What We Assume: We assume internal reviews are slower than normal because of widespread system disruptions and furloughed staff, adding delays to the process. The absence of PSCs, who often facilitated communication, further exacerbates this issue. Even with the professionalism and dedication of the remaining COs and AOs, it is highly probable that the communication process will be significantly delayed. It is also possible that some waiver requests may not be processed at all, due to the inability of many staff to activate an out of office to direct emails.
4. Critical Timing and Communication
What We Know: Organizations must not resume spending until a formal, written waiver is received from their designated Contracting or Agreement Officer. Any work performed before receiving the waiver is subject to retroactive review, and payments may be delayed or refused.
What We Assume: We assume these communication delays are compounded by staff furloughs and outages in internal digital systems, meaning that even urgent proposals might not receive timely responses. The absence of PSCs, who often facilitated communication, further exacerbates this issue. Even with the professionalism and dedication of the remaining COs and AOs, it is highly probable that the communication process will be significantly delayed. It is also possible that some waiver requests may not be processed at all, due to the inability of many staff to activate an out of office to direct emails.
5. Conclusion: Prolonged Uncertainty and Delays
What We Know: The process to secure a waiver is complex and multi‑tiered, with confirmed disruptions slowing down approvals.
What We Assume: Without streamlined internal processes, clear, high‑level political commitment, and, crucially, the support of PSCs, organizations will face substantial delays in resuming vital operations. Proceeding without official waiver notification risks non‑compliance and potential financial penalties. The reported termination of PSCs has severely crippled the already challenging waiver process.
While the remaining COs and AOs will undoubtedly work tirelessly to process requests, the sheer volume of work, combined with the lack of support staff and system disruptions, means that approvals will likely take an unacceptably long time, potentially stretching towards the end of the 90-day period. Furthermore, the communication breakdowns caused by furloughs and the lack of out-of-office notifications mean that some waiver requests may be lost entirely, leading to a failure to process for some organizations, despite the best efforts of all involved.
Case Study: The Waiver Process in Action
Background: Imagine a humanitarian organization, called Foundation for Essential Support, operating in Country X. Foundation for Essential Support relies on a USAID grant to deliver emergency food and medical services. On January 25, 2025, they receive the blanket stop‑work order. Although they believe a portion of their activities qualifies as “life‑saving,” no funds can be spent until they secure a waiver. Under the current circumstances, with the reported termination of PSC access, this organization faces a significantly delayed and potentially unsuccessful waiver process.
Step 1: Notification and Team Assembly The Country Director of Foundation for Essential Support receives the official stop‑work notice. Immediately, they convene a response team including the Grants Manager and Head of Programs to review all active USAID awards.
Step 2: Internal Review and Proposal Preparation The team spends the weekend analyzing their grant portfolio. They identify that 40% of one key grant’s budget—covering direct food distribution and emergency medical services—meets the “life‑saving” criteria. They document the eligible budget lines, calculate support costs (including regional and headquarters expenditures), and compile a detailed waiver proposal.
Step 3: Submission Amid Disrupted Systems Due to outages in USAID’s central digital repository, Foundation for Essential Support emails the proposal to their designated Country Office Officer instead. This email serves as the formal submission of their waiver request. However, due to widespread furloughs and the reported termination of PSCs, there’s a high risk that this email might get lost in an overflowing inbox, especially if the designated officer was unable to set up an out-of-office message. Even if it reaches the intended CO/AO, the lack of PSC support means significant delays in processing are inevitable.
Step 4: Regional and HQ Review Assuming the proposal is eventually forwarded, it undergoes regional validation and reaches a Bureau‑level reviewer for initial validation. Assuming the Bureau‑level reviewer is still working they start work however, because many staff are furloughed and internal communications are delayed, feedback is slow. After several days, the Bureau‑level reviewer notes minor discrepancies and requests additional clarification, sending it back to country office level. This stage will now be significantly hampered. The COs/AOs, even if they are still working, are overwhelmed and lack the support staff to process requests efficiently. Expect substantial delays at this stage, with a real possibility that the request may languish due to the sheer volume of work.
Step 5: Final Approval and Communication Assuming the Bureau‑level reviewer eventually approves the proposal, it is escalated to the Acting Director for final sign‑off. Foundation for Essential Support must then wait for a formal, written notification before resuming any work. In the meantime, any expenses incurred while waiting for formal approval risk not being paid after the review.
Key Takeaway: This case study illustrates that, under current conditions, even a well-prepared waiver proposal faces significant delays due to system outages, staff furloughs, and an inherently complex, multi‑tiered approval process. Even a well-prepared waiver proposal is now likely to face weeks, if not months, of delays. The professionalism and dedication of the remaining COs and AOs, while commendable, cannot fully compensate for the loss of essential PSC support and the systemic disruptions. The waiver process, designed to be difficult, is now operating under crippling constraints, with the very real possibility that some requests may be lost or overlooked entirely. The 90-day deadline looms, and it is highly probable that many organizations will not receive approval in time, jeopardizing the delivery of life-saving assistance. Without clear guidance and expedited internal reviews, the process remains lengthy and uncertain—jeopardizing the resumption of life‑saving activities.
Likely Timeline Summary:
- Day 1: Stop-work order received.
- Days 2-4: Internal review and wavier proposal preparation.
- Day 5: Wavier Proposal submitted via email.
- Days 5-21+: Regional and HQ review (delays due to furloughs and system outages).
- Day 28+: Potential final approval (timeline highly uncertain).
Key Takeaway
This case study illustrates that, under current conditions, even a well-prepared waiver proposal faces significant delays due to system outages, staff furloughs, and an inherently complex, multi-tiered approval process. The need for high-level approvals, including potentially from political appointees, adds another layer of uncertainty and potential for ideologically driven decisions. Without clear guidance and expedited internal reviews, the process remains lengthy and uncertain—jeopardizing the resumption of life-saving activities. Even with a waiver, organizations face the risk of retroactive reviews and potential penalties if their work is later deemed non-compliant. This creates a chilling effect, discouraging organizations from resuming even potentially life-saving activities.
Specific Impacts of Suspended Activities
The delays caused by this convoluted waiver process have immediate and tangible consequences. For example:
- Emergency Food Assistance: The suspension of food programs, even temporarily, can lead to increased malnutrition and starvation, particularly in areas already facing food insecurity. The rumored, but unconfirmed, waiver for the World Food Programme (WFP) highlights the urgency of this issue. If true, the scope and mechanism of this waiver need to be clarified immediately.
- Medical Services: The interruption of medical care, including HIV/AIDS treatment under PEPFAR, can have life-threatening consequences. Patients may experience treatment interruptions, leading to drug resistance and increased morbidity. The PEPFAR waiver, while allowing for the continuation of some treatment, still restricts many vital services and requires a burdensome certification process, adding further delays.
- Shelter and WASH: Suspension of shelter programs leaves vulnerable populations exposed to the elements, while the interruption of water, sanitation, and hygiene (WASH) programs increases the risk of disease outbreaks.
- Protection Services: Programs that provide protection for vulnerable groups, such as refugees, displaced persons, and survivors of violence, are also impacted. This can lead to increased risks of exploitation, abuse, and human rights violations.
The human cost of these delays is immense. Every day that programs remain suspended is another day of suffering for those who rely on them. The burden of this convoluted process falls disproportionately on local implementing partners, who often lack the resources and capacity to navigate complex bureaucratic hurdles. Without the support of larger international organizations, many of which are now forced to scale back or suspend operations, these local actors are left to fend for themselves in an increasingly hostile environment.
This broken waiver process, far from offering a lifeline, has created a quagmire for humanitarian organizations. They are now forced to make impossible choices, each with potentially devastating consequences, as the next section will explore.
US Funding Cuts Threaten to Unleash Chaos in Northeast Syria, Undermining Anti-ISIS Efforts
The recent halt to U.S. foreign assistance is not just a distant policy decision; it has immediate and devastating consequences on the ground. Nowhere is this more evident than in Northeast Syria, where the abrupt suspension of aid is creating a humanitarian catastrophe and threatening to reignite the very conflict the U.S. has long sought to contain.
Abrupt US aid cuts are crippling humanitarian efforts in Syria, creating a dangerous vacuum that risks destabilizing the region, fueling a resurgence of ISIS, and causing immense human suffering. This isn’t just a humanitarian issue; it’s a national security concern.
The US government’s recent suspension of aid to Syria has sown confusion and uncertainty among aid organizations. Vague “waivers” offer little clarity, leaving groups unsure if they can even operate. The result? Aid has dried up, leaving hundreds of thousands vulnerable.
Why This Matters:
- ISIS Resurgence Risk: Northeast Syria is a volatile region where the fight against ISIS continues. The sudden withdrawal of aid creates a breeding ground for instability. Desperate people are more susceptible to radicalization. A Senior Humanitarian Official on the response warns, “You can’t have a de-ISIS mission working against its better interests, destabilizing the entire region with this move.” This isn’t just about humanitarian aid; it’s about US national security.
- Humanitarian Catastrophe: Basic necessities like food, water, and medical care are disappearing. Camps for displaced people risk becoming unmanageable, jeopardizing the security environment and allowing disease to spread rapidly. “Approximately 340,000 people live in some form of camp, informal settlement or school repurposed as an emergency shelter in the Northeast. These people are reliant on daily water, food and fuel. Life-saving assistance has stopped overnight for many,” according to a senior humanitarian official. This is a recipe for disaster.
- Undermining US Investments: The US has invested heavily in the region to combat ISIS and promote stability. These cuts risk squandering those investments and making the situation far worse.
What Needs to Happen:
- Immediate Reinstatement of Funding: The US government must immediately restore funding for humanitarian aid in Syria. Lives and regional security are on the line.
- Clear and Consistent Guidance: Vague waivers must be replaced with clear, unambiguous instructions for aid organizations to resume programming, communicated directly by the CO/AO’s, precisely as was outlined in the SWOs they received. “No HQ is going to be able to manage the fiduciary risk of interpretation”. Most organizations who hadn’t been directly contacted immediately following the EO were slapped with retroactive stop work orders late into last week, rending any cost incurred since Jan 24th ineligible. They need to know the rules to get aid flowing again.
The Bottom Line:
This isn’t just about charity. It’s about preventing a humanitarian catastrophe, safeguarding US national security interests, and ensuring that past investments in the region are not wasted. Failure to act quickly will have devastating consequences.
The Existential Threat: Cash Flow Crisis and the Risk of Organizational Collapse
Beyond the immediate humanitarian impact, the funding freeze has created an existential crisis for many organizations operating in the aid sector, especially those reliant on U.S. funding. The reality is that NGOs, UN agencies, and other humanitarian organizations, even the largest ones, do not operate like for-profit businesses. They do not make a profit. They do not have significant cash reserves. They operate on tight margins, often with funding allocated to specific projects and activities, leaving little room for flexibility in the face of sudden funding disruptions. This freeze has triggered an immediate and potentially devastating cash flow crisis that threatens the very existence of many of these organizations, and severely limits the ability of others to provide assistance.
The Cash Flow Time Bomb:
The abrupt halt to U.S. funding has created a dangerous cash flow vacuum. Organizations are faced with a terrifying dilemma:
- Continuing Operations Without Assured Reimbursement: If organizations continue providing life-saving assistance – such as distributing food, providing medical care, or maintaining essential services – without explicit authorization under a clear waiver, they risk doing so at their own financial peril. They might be forced to deplete their already limited reserves, draw on lines of credit (which, as noted in the Devex briefing, may be drying up), or divert funds from other programs, assuming they even have any flexibility to do so. This is money they may never get back. A large agency might weather this for a short time, but smaller and medium sized NGOs, and certainly most local NGOs, may not be able to for even a single day.
- Facing Retroactive Review and Potential Penalties: Even if organizations believe their work falls under the “life-saving” definition, they face the risk that the administration may retroactively disagree. This could lead to demands for repayment, financial penalties, and even debarment from future U.S. government funding, a death sentence for many.
- The Brutal Reality of Suspensions: Suspending programs, while seemingly the “safe” option, is not without significant costs. Organizations still have contractual obligations to staff, landlords, and vendors. They may face penalties for breaking contracts, and they still need to maintain a minimal level of operational capacity to manage the suspension and prepare for a potential restart.
- The Speed of the Crisis Exacerbates the Problem: The sudden and unexpected nature of this freeze, ordered on the 25th with a demand for compliance by the 28th, has left organizations with no time to plan or to make measured decisions.
The UK’s Charity Commission Regulations and the Ghost of Merlin:
The situation is particularly precarious for UK-based charities. Under UK Charity Commission regulations, charities are not allowed to continue operating if they cannot meet their financial obligations. This creates a legal obligation to cease operations if there’s a risk of insolvency, even if it means halting life-saving programs.
The current crisis evokes the specter of Merlin, a respected UK international medical NGO that collapsed in 2013 after losing several grants and while otherwise sound could not make payroll and continue, with Save the Children UK having to absorb its teams and projects. While not a direct comparison, the Merlin case serves as a cautionary tale, demonstrating how rapidly a seemingly stable organization can unravel when faced with funding shortfalls. The risk of a similar collapse among organizations heavily reliant on U.S. funding is now very real. The US has now created a situation where even well-managed charities may be forced to wind down due to this sudden, drastic, and poorly-implemented funding freeze.
The Ripple Effect: National NGOs and UN Agencies at Risk:
While the most immediate impact may be felt by smaller and medium-sized NGOs, the interconnected nature of the humanitarian system means that even large UN agencies are not immune.
- National NGOs: These organizations, often the primary implementers of programs on the ground, are particularly vulnerable. They typically have very limited reserves and are heavily reliant on funding from larger international organizations, many of which are now facing their own cash flow crises. The collapse of these national NGOs would have a devastating impact on local communities and dismantle carefully built networks of trust and local expertise.
- UN Agencies: Although UN agencies like UNHCR and IOM have multiple funding sources, they are still heavily reliant on U.S. contributions. For example, in FY2023 the US provided 54% of UNHCR’s budget, and 65% of IOM’s. The freeze jeopardizes their ability to carry out their mandates, particularly in areas where the U.S. was a major donor.
A Crisis Amplified by Previous Funding Cuts:
It’s crucial to remember that this funding freeze comes on the heels of significant cuts to development assistance by other major donors, including the UK, Germany, and the EU, in late 2024. Many organizations were already in a precarious financial position, having implemented hiring freezes, program reductions, and restructuring efforts. The US freeze pushes many over the brink, leaving them with no room to maneuver.
The “Selfish” Imperative: A System Forced to Prioritize Survival
The brutal reality is that organizations are now being forced to make incredibly difficult choices, prioritizing their own survival to avoid complete collapse. This means that even if a program is demonstrably “life-saving,” an organization may have no choice but to suspend it if continuing operations would jeopardize the organization’s overall financial viability. This is why we are seeing such a narrow interpretation of the waiver.
This is not a choice that any humanitarian organization wants to make. It goes against the very core of their mission. But the current circumstances, created by the abrupt and ill-defined funding freeze, leave them with no other option. The interconnectedness of programs, the lack of clarity on waivers, and the sheer scale of the funding cuts (43% of tracked global humanitarian funding in 2024) have created a situation where even a temporary pause can have cascading and potentially irreversible consequences.
The result is a humanitarian sector on the brink, forced to make impossible choices that will ultimately harm the very people they are meant to serve. The need for immediate clarity, a realistic and workable waiver process, and a restoration of funding is more urgent than ever.
Conclusion: A System on the Brink - Immediate Action Required
The U.S. foreign assistance freeze has plunged the global humanitarian and development sector into an unprecedented crisis. The January 28th directive, with its self-executing stop-work order and ill-defined waiver process, has created a perfect storm of financial instability, operational paralysis, and ethical dilemmas. Organizations, particularly those reliant on U.S. funding, are now facing an existential threat, forced to make impossible choices between risking insolvency and abandoning vulnerable populations. The specter of organizational collapse, particularly among smaller NGOs and local partners, is no longer a distant threat; it’s a rapidly approaching reality. The very system designed to alleviate suffering is now teetering on the brink, not due to a lack of will or expertise, but due to a deliberately engineered funding crisis.
We cannot afford to wait for further clarification or to allow bureaucratic paralysis to determine the fate of millions. The time for half-measures and vague pronouncements is over.
We must demand:
- Immediate Clarity from the U.S. Administration: We need clear, operational definitions of “life-saving assistance” and a transparent, streamlined process for securing waivers. The current ambiguity is unacceptable and is directly contributing to the suffering of vulnerable populations.
- Restoration of Funding: The U.S. government must immediately restore funding for all essential humanitarian and development programs.
- Protection for Organizations: Implementing partners need assurances that they will not be penalized for good-faith efforts to interpret the vague guidelines. They also need access to bridge funding and other financial support to weather this crisis.
What you can do:
- Contact your elected officials: If you are a U.S. citizen, make your voice heard. Demand that Congress intervene to restore funding and hold the administration accountable.
- Support humanitarian organizations: Donate to reputable organizations working on the ground. Even small contributions can make a difference.
- Share this information: Spread the word about this crisis. Use the hashtags #FundUSAID, #HumanitarianCrisis, #AidFreeze, #DefendAid, and #Devex on social media.
- If you are an implementing partner: Document the impacts of the freeze on your organization and the communities you serve. Share your stories with advocacy groups and, if possible, with the media.
The world is watching. Our collective response to this crisis will determine not only the fate of millions of vulnerable people but also the future of international cooperation and the very principles of humanitarian action. We must act now, with urgency and determination, to avert a catastrophe and reaffirm our commitment to a more just and humane world.