Bulwark Takes - Deadly Effects of USAID Cuts Are Already Happening

Episode Date: February 28, 2025

Sam Stein is joined by Jeremy Konyndyk, president of Refugees International, to discuss what USAID aid was cut and whom it will affect, why George W. Bush who supported many of these programs hasn’t spoken up, and how cuts at USAID is a test case for what will happen across all of government.  Read more, “A Midnight Global Health Massacre”

Hey, guys. Welcome back. Sam Steinman of The Bulwark here. I have a special guest, Jeremy Knyndyke, President of Refugees International, former top official at USAID during the Biden or Obama or both? Both. Both. Okay. He's been around the block. Let's just put it that way. Jeremy's been instrumental for anyone who's been following this calamity and catastrophe that's happening at USAID. Amid a torrent of misinformation and disinformation, Jeremy has corrected narratives. He's only one man, but he's done his part. What we're going to talk about today is what I consider from my reporting to be probably

the most calamitous set of cuts that we've seen to date. And they took place last night. Thank you, Jeremy, for joining us. I really appreciate it. Let's talk about what happened last night. What happened last night? Do you want to explain? Yeah. So there has been a legal challenge now for the last few weeks by some of the organizations that work with USAID. So to step back, the work that USAID does is almost always in partnership with nonprofit organizations and government contractors who actually do the kind of implement the programming on the ground. And of course, they need to get paid. And the way that they often get paid is they will do a program. And then when they've, you know, implemented a certain amount, they will come back and they will draw down money

from the government payment system to reimburse them for the costs that they've incurred. When the Trump administration came in, they just turned that off and stopped paying those costs. So they began basically stiffing the contractors, which is a rich tradition for both Elon and Donald Trump. I was going to say, highly in character. They're very good at it. There's some pedigree. There's some pedigree. Yeah, they're the best.

Old habits, right? So they began stiffing the contractors. And to the tune of, collectively, billions of dollars. Right. And for organization— It was about $2 billion, right? $2 billion is the amount they're citing. Yeah, the amount that the government swore that they couldn't possibly pay in the appeal.

And so for many of these organizations, that's an immediate existential financial crisis. Right. Because they basically spend their own reserves in order to kind of front front load the costs and they assume they'll get paid. They'll get reimbursed. They're sunk. So and to be clear, this is not just like a freeze on future programs, future work. This is a refusal to pay costs that were lawfully incurred during the Biden administration. You know, these are U.S. government debts. Right. Well, they're also contracts, right? I mean, we said we would pay you for your services or we will give you money and reimburse

you and then just cancel the contract midstream. Now, that suit went up to the Supreme Court. It's still potentially going to be settled. But essentially, John Roberts said, you know what, this midnight deadline of Thursday, I'm sorry, I guess it was Wednesday midnight. I can never really tell. That is not – we agree with the government that they just cannot meet these obligations, putting aside that, of course, they could because they just need to bring the people back in place who can handle the contracts, administration. But putting that aside, Roberts basically said you don't have to do this right away.

But they may eventually have to do this, correct? They may. And I think the best way to understand what Justice Roberts did is not even necessarily agree with the government so much as just to say this is brand new to us. We need to figure out what's going on. Right. So give us two days to figure out what's going on. And they're going to figure it out by Friday according to what the Roberts, or they're at least giving themselves until Friday to figure it out. Right.

They've asked for arguments by Friday, and then they will see where they go from there. And now, secondarily to this, as this is all happening, because this is one piece of it, we get news yesterday that huge amounts of additional contracts, awards, grants that the USAID and State Department have put together for a variety of products across the globe that are unrelated to this $2 billion hotronch have now been canceled, correct? Correct. I mean, it was an absolute bloodbath yesterday. So the guy named Pete Morocco at State Department, who is the director of the Foreign Assistance Budget Office, and he has taken upon himself the authority to cancel all these things. And he yesterday, basically to get out ahead of the court, I mean, I think it's important

to understand the timing here, that what they did yesterday was go back to the court and say, well, now we've canceled everything. There is no more freeze to lift because everything that, you know, we're not freezing anything anymore. It's all either canceled or back underway. Right. So it's about 500 or so, 500 or so programs. We're still going to keep going, but, you know, 5,000 we've canceled.

We've canceled the other 90 plus percent of the programs that USAID was funding. It's a really bald-faced attempt to just circumvent a court order. And so it will be interesting to see what the Supreme Court makes of that. But in the meantime, the things they were canceling were – Yeah, let's get into that because that's the most important thing. So what exactly – because I woke up to dozens of signal messages, freaked out people across the globe saying, holy shit, I think this PEPFAR contract I worked on in South Africa is just gone.

Water in Congo and stuff like that. So run through your basic understanding and take however long you want. Like get granular about what exactly we just lost last night. Well, and I think the important context here too is that, you know, Secretary Rubio has been saying for weeks that life-saving programs would continue and would not be disrupted. So, you know, the PEPFAR programs that support HIV meds for 20 million people around the world, the humanitarian programs that provide food, water, shelter for people in disaster zones, all of that. He had said that will not be touched. He issued a waiver.

They had been giving waivers to different organizations saying these programs are waived from the freeze. They had yet to pay any of those organizations, by the way, but they had at least given the waivers. I have yet to talk to an organization in the last 24 hours that has not had a waived program now canceled. So the waivers, we always suspected the waivers were basically a sort of bullshit diversion tactic, and this just confirms that. So the sorts of things that have been canceled, that I have personally heard

about. One of the things that I did, I used to run disaster response at USAID and the Obama administration. And so I was kind of the guy who would push the button to deploy the search and rescue teams after an earthquake. So if there were an earthquake, for example, Nepal, a major earthquake in Kathmandu, Nepal in 2015, we deployed U.S. search and rescue teams. USAID contracts with the team from Fairfax County and the team from L.A. County. So the L.A. County team, of course, very specialized in earthquakes, given where they're from. The Fairfax County team, very good at that, but also that is one of the key teams for major emergencies in the national capital area. We provided a lot of funding to those teams, and we would deploy them when there was a disaster.

The entire unit that deploys those teams has now been pushed out of the agency. And yesterday, they canceled the contract with the L.A. County team, with the L.A. County search and rescue team. They canceled a contract for what's called ready-to-use therapeutic food, or more commonly called Plumpy Nut. This is an incredible product that is made of peanuts and dairy and some other nutrients. It's sort of like a peanut butter paste. It comes in little sachets, and it can basically bring children back to life. It is highly nutritious and highly adapted to the nutritional needs of children suffering from severe malnutrition. And when this product was created, I think about 20 years ago, it revolutionized how we fight malnutrition globally.

It meant that a kid who used to need to go into inpatient intensive malnutrition treatment over a protracted period could now just be sent home with plumpy nut, eat the plumpy nut under some supervision and basically recover from malnutrition treatment over a protracted period could now just be sent home with plumpy nut, eat the plumpy nut under some supervision, and basically recover from malnutrition. It is a miracle product. It is produced with peanuts grown on American farms, and it's produced from an American manufacturer here. That contract was canceled yesterday. I have had colleagues from Refugees International in Syria over the past week talking to humanitarian organizations there. And they woke up yesterday morning, too. One of them is still on the moon. He woke up yesterday morning to hundreds of thousands of displaced people who remain

in displacement camps within Syria, feeding programs, hospitals and clinics for displaced people inside Syria, mine clearance and UXO clearance in Syria. So if refugees are, there's six million refugees outside of Syria right now. For those people to be able to go home, they need to be able, you know, they need to know that their neighborhoods are not full of unexploded ordinances. The teams that were querying those canceled. So obviously that's a risk, but it also, it's a risk kind of in the immediate term, it's going to kill people, but it's also going to make it harder for refugees to go home, which puts more burden on the surrounding countries that are still hosting refugees.

I talked to another organization today that had had health and water programs, is providing one of the largest networks of health clinics in Darfur. So Darfur, for those who probably aren't as in the weeds of this, of Sudan as I am, Darfur is currently experiencing both a famine and a genocide in the midst of the Sudanese civil war. The only lifeline that people in Darfur have right now is through international humanitarian support. The U.S. is the largest single donor to all that, provides the support to the largest network of NGO clinics. That was all just pulled down. And all of these are definitionally life-saving programs. All of these are things that

very literally keep hundreds of thousands, even millions of people alive day in, day out. And that is what's being pulled down. Why do people have trouble saying that? I mean, I know it sounds crude, but it's true that Marco Rubio and Pete Maraco just killed a bunch of people. They're going to kill people. Yeah. People are already dying. I mean, people are already dying from the disruption to HIV treatment. They're dying from... people. Yeah. People are already dying. I mean, people are already dying from the disruption to HIV treatment. They're dying from programs that had already been disrupted because even before they were canceled, the funding was cut off. So I talked to an organization last week that was choosing with their own money, by the way, with their own funding.

Do we keep running our nutrition centers in Darfur, or do we keep running our anti-malaria programs in Southeast Asia? It's like a Sophie's Choice situation. Every organization has been in this Sophie's Choice situation. The argument you get from critics is twofold. One is, well, I'd rather spend our money here. We have needs here. And obviously, I think that's what you're talking about. The Syrian refugee thing is just a classic example. The refugee crisis shows up on our doors. That's something we have to pay for, right? But the other one is, well, can other countries and private philanthropists fill the void? And I'm curious about what you think about that. As someone who, I mean, Refugees International, obviously, you guys recruit private philanthropy. But what

is the current state of private philanthropy around these types of global health and global well-being initiatives? Yeah, it's a great question. I mean, the short answer is no, they can't fill that gap. You know, the U.S. is the largest donor in the world. And if you put, so USAID's annual budget was like $40 billion a year. Gates Foundation is by far the biggest philanthropic institution in the world. I think their budget is under $10 billion a year. And that's already in the system. So it's not like they can just find four times that amount.

Just go find five more Gates. That's already baked in. Yeah, look. If Elon and Jeff Bezos and some of these other fantastic people decided to do what Bill Gates has done, maybe they could do some of that. They've never been terribly charitable. But yeah, no, there's no way for other donors to fill in a gap like this. In the humanitarian system, which is where I've spent most of my career, the U.S. usually provides about 40% of the global humanitarian financing. And the next biggest donor is about 10%. Well, that's why I was talking to someone last night

who was freaked out like everyone else. And they noted that we had pulled our grant to the U.N. AIDS project. And it's just a global monitoring of the AIDS epidemic. It's like we just suddenly lost our eyes and ears. And I was trying to get a sense of like how consequential it was. And they pulled up the data and like, that's half of their funds. Yes. Half just, just ripped away. And it's like, I don't mean to laugh because it's, it's obviously so tragic, but it's so dark. It's hard to conceive. It really is. And, and, and look, I, I wish more donors stepped up. I wish China put more into the system. I wish Russia and India and other large and increasingly wealthy countries put more into

the system. But at the same time, this is what U.S. leadership is. Right. U.S. leadership is showing that generosity, but also understanding that is a convergence of our interests and our values. It's not to U.S. interest to let the gold blades epidemic get out of control. No, of course not. Well, so the thing that I – and this is kind of what piqued our interest in talking to you.

The administration is like – there is some cases – I'm not trying to overstate it. Trust me, I'm not. Where the administration will be reactive to negative news and then come back and say, actually, we're going to restore this. So yesterday, and I just think it's bullshit, but whatever. Yesterday, Elon Musk says, once we figured out that we had defunded Ebola, we wanted to refund Ebola, which, yes, of course, I'm glad. But the reality is they didn't. Like they had not. Or at least if they had, it was so piecemeal that it didn't make up

for all the other cuts they had made. So talk about that. But then talk specifically about this idea. Can social and political pressure be applied to restore some of these cuts? I hope so. I hope social and political pressure, definitely. And we've seen some of that already. We have? It's been very interesting to watch. Yeah, we've seen a bit. Not enough. Okay.

Not enough. Where have we seen it? Just out of curiosity. So there have been a number of Republican members of Congress who have weighed in about protecting specific programs, who have weighed in about – Yeah, but that's like so provincial. It's like Jeff Moran being like, oh, the food that's going away. It's like, yeah, it's because it's from Kansas. Yeah. But hey, look, it's something.

I think there's going to be a ton of damage. And I think the essential thing now is to preserve enough of the core capacity and expertise of what the U.S. government has built up at USAID over many, many decades, that it is not completely lost and that we have something to rebuild from again, you know, when there's an administration that's inclined to do so. But, you know, it will take that kind of pressure. And yeah, I think where we have seen the administration backpedal is when they are under, when they're kind of taking some incoming politically over the stupidity and recklessness of some of what they've done. So, you know, the first, the first instance we saw of that was in the very first part of the aid freeze when the programs that were supporting guards at some

camps in northeast Syria that held a lot of members of ISIL and their families walked off the job because their funding had been cut right and oops whoops yeah and then they scrambled and and you know amazingly even as they're telling the government the courts that they can't possibly turn the funding back on they managed to get the funding back on for that one yeah because there was a ton of political pressure and i think inside the administration a bunch of the syria experts were going what the f are you doing right and they were not you know this is just pete morocco shutting things down this is not him like going to the syria team and saying hey what happens well yes but there was also that story in the post where it's like Rubio wanted to sign off on a few things,

and then it was the Doge brothers who were checking off and saying, actually, no, we're not going to do this. So maybe it's not just Pete Morocco. Maybe it's this weird Elon task force, too. It's entirely possible. Either way. There's no transparency about any of it, right? Right. What you can say from the outside, it's clearly not working.

So I guess this ends where my piece this morning sort of left off, which is PEPFAR. It's not fully defunded. I don't want to overstate it. There's different funding sources into PEPFAR than just USAID. But USAID is a funding source into it. And we know for a fact that PEPFAR in South Africa lost its contracts last night. There are officials in South Africa worried that it's going to completely end the program because it's so critical. That's George W. Bush's crown jewel program.

George W. Bush has not said a peep. Nope. Have you guys or do you know of anyone reaching out to George W. Bush to say, hey, bud, you know, if there there's ever a time it might be on this one i i don't personally know it wouldn't surprise me at all if some of the folks are um but you know a lot of the i mean that was such a different republican party i get it but it doesn't matter like at some point he should be speaking out and and frankly every president should be speaking out um the the former usa administrators and george george bush's usa administrator andrew nazios who is a friend of mine and just a

phenomenal guy he's been very very vocal yeah um and that you know it gets to like this really is a sort of trump and elon thing this is not even a republican thing i mean they're all kind of bending the knee right now. But look, when there have been hearings, there was a hearing in the House Foreign Affairs Committee a couple weeks ago, you were not hearing too many Republicans apart from Chairman Brian Mast echoing the disinformation from Elon because they know better. They just aren't willing to stand up for it. And what we're facing now is ultimately, if – Congress could still step in and impose some breaks on this. The courts are kind of a delaying tactic to create some time.

Maybe Congress can do that. But ultimately, if Congress lets the administration do this – Well, they're going to vote on a funding bill in a couple weeks. Right, right. weeks right right yeah it's probably gonna it's probably gonna be a cr yeah which is fun which funds usa but i mean usa doesn't exist so i don't really know how that works well and this is where this is where it becomes an impoundment question and that is what they are angling for and that's why they want to escalate this to the supreme court so rapidly right they are not you know they are not doing this just because they hate foreign aid,

although I think that they do. I think Elon and Trump sincerely very much do. But also, for Russ's vote, this is the softest target for the impoundment fight. So it is a way for them to take that fight. It's foreign policy, which has been more traditionally the president's purview and then has no real domestic constituency beyond people who watch this program. Yeah, exactly. Small but mighty. Yeah, that's right. And so I think that's why you're seeing them stonewall the court so much, just so blatantly.

That's why they want to go straight to John Roberts with this. And they think they're going to win Roberts with this. And, you know, they think they're going to win that. They think they're going to win that fight. And we'll see. But there too, like Congress is not standing up for its prerogatives. And the kind of the larger story here is USAID, even if you don't care a whit about foreign aid, USAID is a test case for what they now want to do across the government. So the first thing they did at USAID was push out a bunch of the lawyers, including the ethics lawyers. We're now seeing that they're now going, they're doing the same thing at DOD. They're pushing out the JAGs.

So like this is, this is kind of the template. What they piloted at USAID is the template for what they're now exporting across the federal government. So it's really, really important to hold the line on USAID, even if you're not particularly interested in foreign aid, because if they get away with it here, then they're establishing precedents that they're going to try to get away with elsewhere. Jeremy, you're a busy guy. I don't want to keep you too much longer. So thank you so much.

Really appreciate it. Stay in touch as these things progress, okay? Absolutely. Thanks, Sam. All right.