🔒 Trump’s foreign aid cuts shake NGOs and philanthropists

Key topics:

USAID funding slashed by 83%, jeopardizing global health programs.
Donors scramble to prioritize aid amid widespread funding gaps.
Foundations rethink development aid as nationalism rises.

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By Devon Pendleton and Antony Sguazzin ___STEADY_PAYWALL___

Billionaire philanthropists and foundations are reeling from US President Donald Trump’s decision to gut America’s foreign aid agency and slash tens of billions of dollars in assistance, leaving recipient organizations — fighting everything from HIV to malnutrition — anxiously waiting for a white knight.

For non-governmental organizations, the silence is deafening, with increasing concerns about funding for 2026 and beyond for programs that support millions of the poorest people on earth. Philanthropists and global-health focused charitable foundations privately describe a state of shock over the magnitude of the cuts — the greatest drop in funding since the US created the current foreign aid model in the 1960s — and the difficult decisions they face, given the lives at stake.

“How do donors pick” which NGO survives? said Michael Jarvis, executive director at TAI Collaborative, a donor network that includes some of the world’s biggest charities, including the MacArthur Foundation and the Ford Foundation.

On Monday, Secretary of State Marco Rubio said he’d cancelled 83% of USAID’s programs. Donors are racing to assess which areas they care most about and which grantees they’ll continue funding. For some groups, it’s a life-or-death choice, Jarvis said.

“Who are the key groups under threat who might go under? That question is very sensitive,” Jarvis added, noting that triaging the needs is even more urgent than during the pandemic.

The void created by the US pullback is so vast even the world’s biggest charity couldn’t come close to filling it.

The Gates Foundation, founded by Bill Gates — the sixth-richest person on Earth with a net worth of $163.4 billion — pays out nearly $9 billion annually, the most of any charity. USAID had about $43 billion worth of projects in 2023.

“There’s a huge gap that I don’t see anybody filling,” said Remy Rioux, chief executive officer of Agence Française de Développement.

Permanent Change

Many donors are hurrying to form coalitions to pool resources to assess need. They also want to frame their giving carefully, given Trump’s retributive politics, said a person familiar with philanthropists’ thinking. That may mean sticking to causes they’re known for, and having a clear rationale behind significant donations to avoid extra scrutiny from officials.

“The way it’s been done has been quite cruel and quite callous because what you’ve had is people in the middle of HIV/AIDS treatment, people are in the middle of war situations, people in refugee camps” being hurt, said Binaifer Nowrojee, president of the Open Society Foundations, which was founded by billionaire George Soros. “You can see a kind of an inhumanity in the manner in which it’s been done and the way it has left people in the lurch.”

Talks are being held between philanthropies and development finance institutions. Rioux said he has spoken to Mark Suzman, CEO of the Gates Foundation, about possibly providing concessional loans for healthcare programs.

Both charities and development finance groups are seeing this less as a moment in politics and more as a permanent change.

It’s not just the US that’s curbing foreign aid. The UK, Belgium and the Netherlands are among countries that recently announced plans to reduce development funding, indicative of a widespread tilt toward nationalism and higher defense spending.

“Most of the governments told us that we have to prioritize among the institutions,” said Alvaro Lario, president of the International Fund for Agricultural Development. “Overall official development assistance is being questioned.”

That’s prompting a wholesale rethink of the nature of international development aid among ultra-wealthy donors, particularly next-generation inheritors, according to Jarvis.

There’s growing interest in funding initiatives aimed at strengthening economic systems, by improving revenue generation and debt management.

Anxiety and Resolve

The assault on foreign aid has stirred anxiety but also resolve among nonprofits that are reckoning with the need to swiftly prove their value.

“It’s made us look at everything we do and make sure we’re extremely efficient in how we work and how we budget and what we can and cannot do,” said Damilola Ogunbiyi, CEO of the United Nations’ Sustainable Energy for All. “You step up your game a bit and just show the value you add at the country level.”

*Aid workers move bags of yellow lentils at an aid operation run by USAID, in Mekele, Ethiopia, in 2021. Photographer: Jemal Countess/Getty Images*

One way private donors are choosing to prioritize is by favoring NGOs that serve as a central pillar of broader networks. Their failure could cause a domino effect among smaller, more localized groups. Another is immediacy — for example, focusing on nonprofits that distribute medicine soon to expire.

To be sure, a few foundations have announced specific ways they’re addressing the Trump administration’s pullbacks.

Bloomberg Philanthropies, the foundation of Michael Bloomberg, founder and majority owner of Bloomberg News parent company Bloomberg LP, committed along with others to fulfilling America’s obligations to the Paris climate accords, following its withdrawal in January.

The MacArthur Foundation said last month its boosting its charitable payout from the legal minimum of 5% of its assets to at least 6%, which the foundation estimates will amount to at least $120 million in additional funding over the next two years.

“The need for a surge of funding is plain,” MacArthur President John Palfrey said in a statement announcing the change. “Philanthropy needs to step up.”

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Key topics:

Permanent Change

Anxiety and Resolve

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