A freeze on all federal grants and loans

Summary

Marketplace Morning Report: A Freeze on All Federal Grants and Loans Release Date: January 28, 2025

In this episode of the Marketplace Morning Report, hosted by Sabree Ben Asore, listeners are brought up to speed on several critical developments in the realms of federal policy, labor movements, corporate compensation, and legislative actions. Below is a detailed summary of the key topics discussed, complete with notable quotes and timestamped attributions for reference.

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1. Trump Administration Freezes All Federal Grants and Loans

[01:06] Sabree Ben Asore opens the episode by addressing a significant policy shift: the Trump administration's decision to temporarily halt all federal grants and loans. This directive, effective immediately, stems from a memorandum issued by the Office of Management and Budget the previous day.

[01:29] Nancy Marshall Genser, Marketplace reporter, delves into the contents of the memo, highlighting the administration's prioritization of funding towards sectors like energy and manufacturing. She notes, "The memo says taxpayer dollars should be spent on things like energy and manufacturing, and their money is wasted on things like, quote, Marxist, equity and transgenderism." This controversial stance has sparked debate regarding the allocation of federal funds.

The memo explicitly states that "Medicare and Social Security benefits will not be impacted, and neither will assistance provided directly to individuals." However, uncertainties remain about the fate of USDA loans aimed at black and Native American farmers.

[01:58] Sabree raises a critical question about the legality of this move. Nancy Marshall Genser references Senate Minority Leader Chuck Schumer's reaction: "He sent out a statement last night saying the Trump administration must reverse course immediately, adding that Congress approved these investments and they are not optional, they are the law."

The memo further instructs federal agencies to cancel awards conflicting with administration priorities and mandates the submission of detailed reports on any paused programs by February 10th.

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2. Unionization Efforts Among Amazon Workers at Whole Foods

Transitioning to labor movements, [02:28] Sabree Ben Asore reports on a significant development: workers at a Whole Foods store in Pennsylvania have voted to unionize. This marks a departure from previous unionization efforts predominantly among Amazon's warehouse and delivery personnel.

[02:43] Nova Sappho provides a closer look, stating, "The unionization vote at the Philadelphia Whole Foods store was close. 134, 100 against, according to the National Labor Relations Board." Despite the narrow margin, this vote signifies the first instance of Amazon grocery workers seeking formal union representation.

Workers cite the need for "a labor contract that raises their wages and recognizes the physical demands they're under from having to work quickly." In response, Amazon maintains that it offers "competitive wages and benefits at the store."

The outcome of the vote means that the United Food and Commercial Workers International Union will enter negotiations to establish a labor agreement, a process that could be protracted. This movement aligns with broader efforts, including recent union activities among Amazon warehouse workers in New York City and the Teamsters union's attempts to organize Amazon drivers.

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3. CFOs Anticipate Reduced Salary Raises in 2025

[03:35] Sabree Ben Asore shifts focus to corporate compensation trends. Citing a new survey conducted by Gartner, she reveals that the optimism among Chief Financial Officers (CFOs) regarding salary increases is waning. The survey indicates a drop in CFOs planning to raise average compensation by 4% or more, down from 86% in 2023 to 61% in 2025.

This trend suggests tightening budgets and cautious financial strategies within corporations, potentially impacting employee morale and retention.

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4. Congressional Review Act: Potential Rollbacks of Biden-Era Regulations

A substantial portion of the episode is dedicated to the Congressional Review Act (CRA) and its implications for current federal regulations.

[05:24] Sabree Ben Asore introduces the topic, noting the complexity of Congressional procedures and the emergence of the CRA as a tool for legislative rollback of previous administrations' regulations.

[05:48] Sarah Hay, a policy analyst from George Washington University's Regulatory Studies Center, explains the CRA: "It's a law from 1996 that allows Congress to overturn rules and regulations issued by the last administration with just a simple majority in both houses plus the president's signature." She emphasizes the rarity of its use, requiring simultaneous control of both legislative houses and the presidency by the same party—a scenario that has been uncommon since 1996 but was achieved by the Trump administration during its terms.

[06:22] Sabree inquires about the types of policies at risk. Sarah Hay identifies approximately 1,300 rules established during the Biden administration that could be targeted, with about 100 deemed significant. Examples include:

• EPA's Methane Emissions Rule: Aimed at reducing greenhouse gas emissions.
• EPA's Lead Pipe Removal Mandate: Requiring the elimination of lead pipes in water systems within a decade.
• Consumer Financial Protection Bureau's Medical Information Restrictions: Prohibiting creditors from considering medical information in lending decisions.

[07:02] Sarah further explains, "There's a look back window in terms of how far back Congress can go to undo regulations. And it goes back to around August of last year."

[07:28] Sabree probes the feasibility of Congress using the CRA to reverse numerous regulations simultaneously. Sarah Hay responds by highlighting the logistical challenges: "Each rule or regulation they want to overturn has to be handled separately. They can't just bundle a bunch of them together. And floor time in Congress is pretty limited." Additionally, using the CRA to nullify a regulation permanently restricts the agency from issuing similar rules in the future, potentially limiting future regulatory flexibility.

[08:16] Sabree closes the segment with Sarah's insights, underscoring the strategic considerations Congress must weigh when employing the CRA.

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Conclusion

This episode of the Marketplace Morning Report provides an in-depth analysis of pivotal events shaping the economic and policy landscape in early 2025. From the Trump administration's controversial pause on federal funding to the evolving dynamics of labor unions within Amazon, and the shifting strategies of corporate compensation, the discussions offer listeners a comprehensive understanding of the current and impending trends. Additionally, the exploration of the Congressional Review Act sheds light on the legislative mechanisms that could reshape federal regulations, signaling potential shifts in policy direction.

Listeners are encouraged to stay informed on these developments, as they hold significant implications for both the economy and the workforce.

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Note: Advertisements and non-content segments have been omitted to focus solely on the substantive discussions of the episode.

Transcript

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[Sabree Ben Asore]

All federal Grants and Loans from Marketplace I'm Sabree Ben Asore, in for David Brancaccio. The Trump administration is ordering a temporary pause of all federal grants and loans. It takes effect at the end of today. The order came yesterday in a memo from the Office of Management and Budget. As Marketplace's Nancy Marshall Genza reports, it leaves a lot of questions unanswered.

[Nancy Marshall Genser]

The memo says taxpayer dollars should be spent on things like energy and manufacturing, and their money is wasted on things like, quote, Marxist, equity and transgenderism. It also says Medicare and Social Security benefits will not be impacted, and neither will assistance provided directly to individuals. So will USDA loans to black and Native American farmers be frozen. Another question Is this legal? Senate Minority Leader Chuck Schumer doesn't think so. He sent out a statement last night saying the Trump administration must reverse course immediately, adding that Congress approved these investments and they are not optional, they are the law. The memo does say that federal agencies should cancel awards in conflict with administration priorities. Quote, to the extent permissible by law, they have to submit detailed information on any program subject to the pause by February 10th. I'm Nancy Marshall Genser for Marketplace.

[Sabree Ben Asore]

Workers at a Whole Foods store in Pennsylvania have voted to unionize. It's the latest organizing effort by workers at parent company Amazon, but this one is different. Most other efforts have focused on Amazon's warehouse and delivery workers marketplaces. Nova Sappho has more.

[Nova Sappho]

The unionization vote at the Philadelphia Whole Foods store was close. 134, 100 against, according to the National Labor Relations Board. Still, it marks the first time that Amazon grocery workers have voted to unionize. The focus has previously been mostly on the retail giant's delivery operations. Workers at the whole food store say they want a labor contract that raises their wages and recognizes the physical demands they're under from having to work quickly. Amazon says it provides competitive wages and benefits at the store. The United Food and Commercial Workers International Union will now have to negotiate a labor agreement, which could take a while. Unionized Amazon warehouse workers in New York City have been trying for three years. Just before Christmas, they joined up with the Teamsters for a strike. The Teamsters union is also trying to organize Amazon drivers. I'm Nova Safa for Marketplace.

[Sabree Ben Asore]

The chances of getting a fat raise are getting a little slimmer in 2025, that is. According to a new survey of chief financial officers by Gartner, the percentage of CFOs who said they were going to raise average compensation by 4% or more went from 86% in 2023 to just 61% this year.

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[Sabree Ben Asore]

Rules of Congress are byzantine and seemingly endless and with the start of the new Congress and administration, a rarely used one has come out of the woodworks. It is something called the Congressional Review act and it could allow Republicans to roll back some but not all, Biden ERA rules and regulations Marketplace senior Washington correspondent Kimberly Adams is here to break it down. Good morning.

[Sarah Hay]

Good morning.

[Sabree Ben Asore]

Remind us, what is the Congressional Review Act?

[Sarah Hay]

It's a law from 1996 that allows Congress to overturn rules and regulations issued by the last administration with just a simple majority in both houses plus the president's signature. But it kind of takes a uni situation. You need to have a flip of control of the White House plus control of both houses of Congress by the new president's party. That's been a relatively rare scenario since the CRA became law. But Trump has had this situation both times he entered the White House.

[Sabree Ben Asore]

We have already seen the Trump administration rescind some Biden rules and regulations via executive order. But what sorts of policies might be at risk because of this cra?

[Sarah Hay]

So there's a look back window in terms of how far back Congress can go to undo regulations. And it goes back to around August of last year. George Washington University's Regulatory Studies center has been tracking which of Biden's rules and regulations could be subject to the CRA. And the team there figures there are about 1300 rules that Congress could target, although only about 100 or so are viewed as significant. Sarah Hay is a policy analyst there, and she gave me a few examples.

There's a EPA rule targeting methane emissions and then also EPA's rule telling water systems to remove all lead pipes in the next 10 years. The consumer Financial Protection Bureau's rule that's prohibiting creditors from considering medical information.

But of course, it's up to members of Congress which, if any of these, they're going to prioritize.

[Sabree Ben Asore]

Well, is there anything to stop Congress from just rolling back everything?

[Sarah Hay]

Well, I mean, time is a big one. In addition to that limited look back window, each rule or regulation they want to overturn has to be handled separately. They can't just bundle a bunch of them together. And floor time in Congress is pretty limited. But the bigger issue is that if Congress uses the CRA to cancel out a policy, it means the affected agency can never issue a similar rule. Here's Sarah Hay at the Regulatory Studies center again.

And so if there's a subject that an agency regulated on and Congress is thinking about overturning it, but then they might say, oh, but maybe we want to issue a regulation on that ourselves in the future.

And so to preserve that option for the future, members of Congress may want to leave it to the executive branch to tweak a regulation rather than completely throw it out.

[Sabree Ben Asore]

All right, Marketplace's senior Washington correspondent Kimberly Adams. Thank you so much.

[Sarah Hay]

You're welcome.

[Sabree Ben Asore]

Our producers are Nick Perez, Arianna Rosas, Alex Schroeder and Erica Soderstrom. Our senior producer is Meredith Garrettson Morby. In New York, I'm Sabru Benishore with the Marketplace morning Report from 8:00pm, American Public Media.

[Kai Ryssdal]

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