Trump offers federal workers exit package as funding freeze sows chaos

President Donald Trump on Tuesday offered most federal workers the option to leave their jobs in exchange for eight months severance, in his most radical move yet to drastically overhaul the government.

The announcement, apparently inspired by Elon Musk's uncompromising management of his companies, followed an attempted freeze on federal funding also ordered by Trump that opponents blasted as unconstitutional.

The emailed severance offer put the lives of US civil servants into disarray hours after the healthcare system for millions of low-income Americans was disrupted in the confusion of the decision to cut off federal aid.

A senior administration official told NBC News that the White House expects between five and 10 percent of federal staff to quit and around $100 billion in savings.

The email to public workers resembled a message that was sent to Twitter employees when it was taken over by Musk in late 2022 that asked for an emailed response if they wanted to stay at the company that was later renamed X.

Musk, who spent over $270 million to help Trump and other Republicans win election, has been tapped to lead a new Department of Government Efficiency aiming to make massive cuts to federal spending.

Federal workers wishing to take the deal on Tuesday were asked to reply to the email with the word "resign" written into the body of the email.

The moves were Trump's latest shock-and-awe steps since he took office a week ago, vowing to force the US government and its employees to back his right-wing political goals or face retribution.

Potentially trillions of dollars in federal grants, loans and other aid faced possible suspension by the White House halt in aid, but a federal judge suspended the order shortly before it was to take effect Tuesday afternoon.

Judge Loren AliKhan halted the order until at least Monday, after several non-profit groups filed suit claiming it was illegal.

Attorneys general of over 20 Democratic-led states later filed a separate suit seeking to block the order.

Even before the order was set to begin, online portals used to access the Medicaid health insurance program for poor families and disabled individuals became inaccessible.

"This is a blatant attempt to rip away health insurance from millions of Americans overnight and will get people killed," Oregon Senator Ron Wyden posted on X.

White House Press Secretary Karoline Leavitt said the website would be fixed soon and that "no payments have been affected."

She defended the drastic move as part of Trump's bid to make the government "good stewards of taxpayer dollars."

The freeze is not a "blanket" stop on spending, but a tool to check that "every penny that is going out the door is not conflicting with the executive orders and actions that this president has taken," Leavitt said.

She listed as examples racial equality and climate change programs that Trump has vowed to eradicate -- and did not answer a question about whether Medicaid recipients would be cut off.

Top Trump aide Stephen Miller later told CNN that Medicaid was not targeted and, in a post on X, said the confusion was a "media hoax."

- Constitutional challenge -

The order, signed by acting director of the Office of Management and Budget (OMB) Matthew Vaeth, did not make clear how such a pause on disbursements of funding will work or for how long.

Federal spending included more than $3 trillion in financial assistance like grants and loans in fiscal year 2024 -- all of which was approved by Congress.

Democrats accused Trump of usurping Congress' constitutionally mandated control over budget spending and attempting to force the government to bend to his personal will.

In the past week, his administration has fired independent government watchdogs and several career prosecutors who were involved in an official probe of his attempts to overthrow the 2020 election.

- 'Sweeping halt' -

Democratic Senator Patty Murray called the order "a brazen & illegal move."

Another Democratic senator, Richard Blumenthal, said the order will create "havoc" in medical and research facilities, which receive major government funding.

The White House memo  explicitly stated that Social Security and Medicare benefits -- used by retirees -- were excluded from the pause.

Areas that might be impacted, it said, include "financial assistance for foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal" -- references to racial equality and climate change programs that Trump has vowed to overturn.

Trump orders curbs on gender transitions for minors

US President Donald Trump signed an executive order Tuesday to restrict gender transition procedures for people under the age of 19, in his latest move targeting transgender people since returning to office.

The order comes the week after Trump said in his inauguration speech that his government would only recognize two genders, male and female, plugging into an issue at the heart of America's culture wars.

"Across the country today, medical professionals are maiming and sterilizing a growing number of impressionable children," said the order. "This dangerous trend will be a stain on our Nation's history, and it must end."

Trump's order said it would now be US policy that it would "not fund, sponsor, promote, assist, or support the so-called 'transition' of a child from one sex to another."

These included what he called "chemical castration and surgical mutilation" -- including puberty blockers, hormones and gender-altering surgery.

It added that the government would now "rigorously enforce all laws that prohibit or limit these destructive and life-altering procedures."

"Our Nation will no longer fund, sponsor, promote, assist, or support so-called 'gender affirming care,' which has already ruined far too many precious lives," the president posted later on his Truth Social platform.

While there is no US-wide law against gender-affirming medical treatments for transgender youth, Trump ordered an end to any federal backing for such procedures.

This includes barring funding for gender transitions under the Medicaid health insurance program for poor families, the Medicare scheme used by retirees, and under US Defense Department health insurance that covers some 2 million children.

Trump said he would also work with Congress to draft legislation to allow children and parents to sue doctors who had carried out gender surgery.

Trump told the Davos forum last week that gender surgery "will occur very rarely" under his administration.

Two dozen Republican-led states have already enacted laws restricting medical care for gender transitions for minors.

US Supreme Court justices clashed over the issue in December as they debated a Tennessee law banning puberty blockers or hormone therapy for under 18s.

Rubio widens exemption for US aid after freeze

US Secretary of State Marco Rubio on Tuesday widened exemptions in a sweeping freeze on foreign assistance, saying the United States would keep funding humanitarian items such as shelter and medicine.

President Donald Trump on returning office last week ordered a 90-day pause to review assistance by the United States, the world's largest donor in dollar terms.

Rubio followed up by freezing virtually all funding, though he specified exemptions for emergency food as well as military assistance to Israel and Egypt.

In a follow-up memo on Tuesday after an outcry from aid groups, Rubio clarified that other "humanitarian assistance" besides food would also be exempt during the review period.

Humanitarian assistance was defined as "core life-saving medicine, medical services, food, shelter and subsistence assistance," Rubio wrote in the memo, the contents of which were confirmed to AFP.

State Department spokeswoman Tammy Bruce, writing on X, said, "Urgent needs are being met."

"Blanket waivers are in place for emergency food and other emergency humanitarian assistance. And a waiver process exists for items not covered by pre-existing waivers," she wrote.

Bruce said that the goal was to get rid of "egregious" funding and programs not in line with Trump administration priorities.

She pointed in part to efforts related to assistance on climate change and gender.

"The mandate from the American people was clear -- we must refocus on American national interests," she said.

Aid groups and Democratic lawmakers have voiced alarm over potentially far-reaching consequences of the freeze.

The latest waiver would appear to give the go-ahead for funding for medication under PEPFAR, a major US program against HIV/AIDS.

Established in 2003 under former president George W. Bush, PEPFAR is credited with saving some 26 million lives.

Speaking before the latest waiver, ONE, the aid advocacy group co-founded by Irish singer Bono, voiced hope for exemptions but warned that "bureaucratic red tape" could still impact PEPFAR funding.

"Our adversaries will capitalize on this gap in US leadership and promote disinformation which will undermine trust in the US and damage our reputation around the world," said Elizabeth Hoffman, North America executive director at ONE.