CNN’s Elie Honig Calls Supreme Court Opinion Ordering Release of USAID Funds a ‘Substantial Setback’ for DOGE and Trump Admin

President Donald Trump and Elon Musk’s efforts to drastically reshape the federal government took a hit at the Supreme Court Wednesday, when the nation’s highest court rejected the Trump administration’s request to continue to freeze about $2 billion in foreign aid funds.

Trump and Musk’s efforts at DOGE have been highly controversial, as an email demanding all federal workers justify their continued employment, massive layoffs, and Musk’s conflicts of interest have all raised eyebrows.

Multiple lawsuits have already been filed challenging the creation of DOGE, its activities, access to sensitive government data and files, and Musk’s role — as well as the DOGE-led effort to cut off vast swaths of foreign aid funding.

The approximately $2 billion at issue in a case decided on Wednesday had been approved by Congress to be distributed under the State Department and U.S. Agency for International Development (USAID) to American businesses and nonprofit organizations.

The Supreme Court ruled in a 5-4 decision, with Chief Justice John Roberts and Justice Amy Coney Barrett, a Trump appointee, joining the three justices appointed by Democrats — Justice Elena Kagan, Justice Sonia Sotomayor, and Justice Ketanji Brown Jackson — in the majority. The short, unsigned opinion ruled that the funds must be paid as “owed for work already completed,” sending the matter back to the District Court to “clarify” the government’s obligations and deadlines.

Justice Samuel Alito penned a dissenting opinion, joined by Justice Clarence Thomas, Justice Neil Gorsuch, and Justice Brett Kavanaugh, in which he wrote that he was “stunned” by the majority’s ruling, which he characterized as “a most unfortunate misstep that rewards an act of judicial hubris and imposes a $2 billion penalty on American taxpayers.” Alito acknowledged the “serious concerns” raised by the businesses and nonprofits “about nonpayment for completed work,” but still argued that the relief granted — unfreezing the funds and ordering their swift distribution — was “too extreme a response.”

CNN chief legal affairs correspondent Paula Reid commented that this ruling still left unanswered “the larger questions about what Trump can and cannot do with DOGE with this kind of foreign aid.”

“The Supreme Court has not weighed in on what we call the merits, or the larger constitutional questions” regarding if the executive branch did actually have the power to not send out funds that Congress had appropriated, said Reid. “That’s going to take some time. But again, twice they’ve [the Trump administration] asked the Supreme Court to help them out, and twice they have declined.”

Reid added that her White House sources were telling her that they were playing the “long game for all of these efforts with DOGE and reshaping the federal government,” expecting them to all end up eventually before the Supreme Court, and hoping they would prevail in the end.

Elie Honig, CNN senior legal analyst, still viewed the ruling as a “substantial setback” for the Trump administration, explaining the opinion’s impact to anchors Wolf Blitzer and Pamela Brown:

This is a substantial setback for the trump administration. Now, the winning side here, the challengers, they had argued in the lower courts that essentially the president has no power to block this federal funding because Congress had already allocated it. And under Article One of the Constitution, Congress has the power to tax and spend. That was ultimately the argument that prevailed here….

[T]he dissenting conservative justices argue what we, the Supreme Court should have done is put this whole thing on hold so that we can have the full rounds of briefing and argument that we’d ordinarily have. And as the dissent correctly notes, the practical impact of this is that $2 billion is almost certainly going to get out the door, and nobody can stop it at this point….

So, as Paula said, the Supreme Court has now sent this case back to the District Court, the trial level court. And this is the same judge who previously ordered the federal government, “you cannot block this, you need to get it out the door.” He gave him something like 36 hours to get it out the door. Well, now the Supreme Court has said back to the District Court: U.S. District Court judge, you do have jurisdiction and authority to order that this money be paid, and you need to work with the parties to get this money out the door in a way that’s quick, but also feasible, not impossible from a technical point of view…

This is why I think this case is so important, because we need to get ready. We’re going to see a whole series of these lawsuits about DOGE, the firings, the withholding of federal funding. They are making their way through the federal courts as we speak.

And this is one of the first two, really, to reach the Supreme Court in general. This is a conservative Supreme Court in general. This court is going to side with broad conceptions of executive power, of presidential power.

However, I think one big exception we need to watch for, and we see it in this case, is when it comes to federal funding, because these these justices are conservative, but they can read the Constitution. And again, Article One, the very first enumerated power is given to Congress. So if Congress has decided to spend money, I think under a strict reading of the Constitution, then the president cannot block it. So watch for that pattern, I think, to repeat itself in the coming weeks and months, generally siding with the president, but not necessarily on these issues of withholding federal funding.

Watch the clip above via CNN.