‘I don’t think anyone can survive for 90 days’: Aid’s grim new reality

For nearly two weeks, the hits have been ceaseless. First, a 90-day pause on all foreign development assistance. Then, a gag order to keep the U.S. Agency for International Development staff from talking about it. And after that, a halt of nearly all USAID-funded programs — a move that’s thrust thousands of the agency’s partners into free fall. “I’ve got people crying. I’ve got people not knowing whether they have a job or not,” said the leader of one humanitarian organization, which receives more than half of its funding from USAID. “I have people saying: but we really need to send these medicines. Are you telling me I can’t do that?” From the largest for-profit contractors to the smallest local organizations, the last two weeks have been marked by fear, chaos, and confusion. Most are scared to speak up about the challenges they’re facing — and terrified to draw attention by asking USAID for help. Many are tangling with their subprimes, unable to pay them (or their staff members) the money they’re due. Medicine is idling on borders, and supplies are waiting on piers. And with every new announcement, more questions than answers seem to surface. “It feels like being in a boxing ring with multiple opponents, trying to figure out where the next blow is going to come from,” said the leader of a second humanitarian agency, who — like nearly all others in this story — spoke on the condition of anonymity so their team wouldn’t pay the price. It’s not like these organizations didn’t expect change. Whenever a new administration takes the helm, a review of USAID’s programs is always anticipated. But very few had expected the change to come at this speed, scale, or level of disarray. “There needs to be review, there needs to be reform,” said Rev. Eugene Cho, the president and CEO of Bread for the World. “But for the current administration to just completely halt [foreign aid] is unprecedented, and has so many damaging effects all around the world.” Confusion reigns Last Friday, the stop-work order noted an exception for emergency food aid, a criteria that no one really knows how to define. Earlier this week, a waiver was created for “life-saving humanitarian assistance,” but it’s unclear who qualifies and how. While headlines about a “reversal” of the aid freeze splashed across mainstream media, the organizations it affected remained in a lurch — and it took days to understand how to apply for a waiver or who it might affect. As of Thursday morning, not a single source Devex spoke to had heard more information about those waivers. “Everyone is in paralysis, and people are completely gutted,” a person familiar with the matter told Devex. “Organizations are scared to move forward because even if they feel they fall within the waiver, they’re expecting explicit authorization.” The same happened yesterday. Trump rescinded his previous directive to freeze federal funding, leaving the aid community struggling to understand whether that directive applied to USAID’s multibillion-dollar budget. (It doesn’t.) USAID also issued a blanket stop-work order to all its implementing partners earlier this week, with Jami Rodgers, the agency’s senior procurement executive, stating it served as an “official notice” for all grantees and contractors to pause their USAID activities. “The most dramatic impact of this is that people are going to die.” --— Rev. Eugene Cho, president and CEO, Bread for the World But after the directive was issued, David Berteau — the president and CEO of the Professional Services Council — warned his coalition of government contractors. According to federal regulations, Berteau said, the only real guidance that affects their projects should come from the contracting officers assigned to them. “If an executive order says stop work, if a memorandum from the secretary of the Cabinet department says to stop work, that has no contractual effect under the federal acquisition regulation,” Berteau explained in a Wednesday press briefing. Throughout it all, the USAID workforce continued dissolving, leaving fewer and fewer staff members to provide the answers. Last year, USAID obligated $30.3 billion across the world — less than 0.5% of the $6.1 trillion federal budget. Now the U.S. government has said no new funds will be obligated until they’ve been approved as “consistent with the President Trump’s agenda.” But at the same time, USAID’s workforce has been slashed, first at the senior executive level, and then across both the global health and humanitarian bureaus. It’s left many organizations asking: Who will be doing these reviews? And who will answer their questions? Apparently, even those on Capitol Hill don’t know, with several aid officials telling Devex they’d approached Republican congresspeople for help, but received blank stares of confusion in response. “There’s a lot of nervousness that in this vagueness, we’ll do something that then — retroactively — is described as not allowed,” another humanitarian official said. “It puts all of us at great jeopardy, which is probably intentional so they can go backward and ding organizations, deny costs, and try to strip organizations of their U.S. funding [for good].” A fight to survive Across the world, organizations are stuck between USAID, their partner organizations, and the communities they serve. And the trickle-down effect — to programs, to staff, to subs — has been painful. While some have been able to channel other funding streams toward programs previously funded by the U.S., far more don’t have the bandwidth to do so. “There are many organizations that have 70%, 80%, 90%, 100% of U.S. government funding,” a humanitarian official told Devex. “They won’t have the flexibility or ability to weather this storm, and it’s pretty clear that a lot of organizations are not going to be able to survive this.” Even some of the largest international aid agencies get more than half their funding from the U.S. government, as USAID is the largest provider of humanitarian assistance in the world. In fact, with the U.S. providing more than 40% of such aid globally, programs affecting some 122 million people are now at risk, according to the U.N. Office for the Coordination of Humanitarian Affairs’ latest Global Humanitarian Overview. The real figure is likely much higher. “We're hearing stories about food that's basically just sitting idle, thousands of tons of food spoiling and discarded,” said Bread for the World’s Cho. “The most dramatic impact of this is that people are going to die.” The freeze has already meant shuttering clinics, stalling deliveries, and preparing to lay off staff, even though doing so could cost more than those staff members’ 90-day salaries. The leader of one aid organization told Devex his staff of doctors and nurses are in the field with no ability to respond — including mothers coming into clinics to deliver babies, and communities waiting for lifesaving nutrition support. It’s prompted some of the organization’s staff to volunteer, and in Gaza, many are choosing to work without pay to ensure medicine, baking in the heat of a truck, gets where it needs to be. “They’ve told me, don’t pay us anything,” the organization’s head said. “We just cannot walk away from these patients.” Still, multiple organizations told Devex they’re preparing for layoffs and severances, especially for their sub-grantees. Another aid leader said the number of jobs on the line has ticked into the thousands, with the vast majority of those jobs outside of the U.S. And to comply with local labor laws, some are being forced to think about bankruptcy as the only way to pay the costs of shutting down an office or letting staff members go. “We already told our sub-partners to stop everything, and they’re already talking about lawsuits,” said the leader of another organization, who said that if things don’t change, they’re expecting to last another 30 days. “We don’t have any guidance, and they don’t know what to do. They have their staff, they don’t have the reserves, and don’t have the money because we cannot draw the money from our lines of credit.” “We’re trying to tell them: We’re in this together,” they added. “And if we get reimbursed we will solve it. But 90 days? I don’t think anyone can survive for 90 days.” All of this is likely to hit the smallest organizations hardest. Over the last three years, local groups across the world have been coached by USAID to revamp their protocols, hire more staff, and invest in new systems to be better partners for the agency. After making those changes, some of these organizations received major grants from USAID — and now, that cash is frozen. “It’s a full-scale attack on … all government programs. If you can kill things through this process, then you get to win points for having made cuts.” --— Anonymous official “Local organizations have no play, no reserves, no endowment,” a different aid official told Devex. “And the other irony of this is that if this crew doesn’t like for-profit contractors, they’re the most likely to survive. Meanwhile, it’s hurting the groups who have the lowest overhead, and who are not trying to make a profit.” Confrontations with community The ripple effects of the stop-work order are already pulsating throughout communities, especially in places such as Afghanistan, Syria, and Lebanon which — even before the freeze — were at a tipping point. In Afghanistan, the head of one aid agency told Devex the trust they built with those they’ve served is now crumbling. “They already felt betrayed by the withdrawal [of U.S. troops in 2021]. They already felt betrayed by the cessation of a lot of the assistance that was going in,” the individual said. “There are people who have received their visas to come to the U.S., and now they’re being told they can’t. It’s just betrayal after betrayal after betrayal, with major consequences.” For communities, those consequences mean lifesaving assistance is being stripped away. For organizations, it means the trust that’s taken years — and often decades — is dissolving day by day. And for the United States government, it means others are already making moves to fill the gaps, taking advantage of the power vacuum that the U.S. has just created. In southern Lebanon, the individual added, they’ve already seen Hezbollah reestablishing clinics, and serving people that were previously being supported by nonprofit groups. “We needed civil society to come in and establish clinics so we could erode what Hezbollah was doing to win the hearts and minds of the population,” the same individual said. “And now, we’ve given it to them on a silver platter.” Another organization at work in Syria said the same, stating that “the reality is that if there’s a vacuum, someone else is going to step in.” “When people suddenly don’t have the food, water, shelter, and opportunities that they have relied on, communities are going to look elsewhere,” the official said. “And in those places, it is groups like ISIS who are looking to capitalize on the confusion. They’re going to step in and say, we’ll provide this. We can help. Trust us. We told you you could not trust them. And that opens up a real security risk.” A culture of fear From the halls of USAID to the countries it supports, another layer has permeated the work of thousands: fear. Both former and current USAID staff members have moved onto Signal, an encrypted messaging application. Most in the international development community have done the same. A chill has been cast across the entire ecosystem, made icier by the 57 senior executive staff that were placed on administrative leave on Tuesday. “We have identified several actions within USAID that appear to be designed to circumvent the President’s Executive Orders and the mandate from the American people,” Jason Gray, the agency’s acting administrator, wrote in an email reviewed by Devex. “As a result, we have placed a number of USAID employees on administrative leave with full pay and benefits until further notice while we complete our analysis of these actions.” Every press briefing, every communique — it’s all on background, with organizations terrified that if they draw attention to themselves, they’ll be next. One official described it all as a silent, terrified “tip-toe,” with everyone “just trying to keep their head above water.” “It’s a full-scale attack on not just international government programs, but all government programs,” another humanitarian official said. “If you can kill things through this process, then you get to win points for having made cuts.”