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The 1-Minute Brief

What: Executive Order 14238 directs seven federal agencies to eliminate all non-statutory functions and reduce their legally required activities and staff to the absolute minimum. It is part of a broader initiative to decrease the size of the federal government.

Money: The order itself does not specify a dollar amount, but it instructs the Office of Management and Budget (OMB) to reject funding requests from the targeted agencies that are inconsistent with the order's mandate to shrink. The affected agencies have combined annual budgets in the hundreds of millions of dollars. For example, the U.S. Agency for Global Media's budget was $882 million in FY2024, the Institute of Museum and Library Services awarded over $266 million in grants in 2024, and the Federal Mediation and Conciliation Service spent $50.3 million in FY2024.

Your Impact: The order could eliminate or reduce access to a wide range of services, including grants for local museums and libraries, support for minority-owned businesses, funding for affordable housing and community projects, and conflict resolution services for labor disputes.

Status: The Executive Order was signed by the President on March 14, 2025, and published in the Federal Register on March 20, 2025.

What's Actually in the Bill

Executive Order 14238, "Continuing the Reduction of the Federal Bureaucracy," mandates a significant downsizing of seven specific federal entities. The order requires these agencies to eliminate all their non-statutory components and functions. For the functions that are explicitly required by law, the agencies must reduce their operations and personnel to the "minimum presence and function required by law."

Core Provisions:

Agency Downsizing: The order targets the following seven agencies for reduction:
- Federal Mediation and Conciliation Service (FMCS)
- United States Agency for Global Media (USAGM)
- Woodrow Wilson International Center for Scholars in the Smithsonian Institution
- Institute of Museum and Library Services (IMLS)
- United States Interagency Council on Homelessness (USICH)
- Community Development Financial Institutions (CDFI) Fund
- Minority Business Development Agency (MBDA)
Compliance Reporting: Within 7 days of the order (by March 21, 2025), the head of each listed agency was required to submit a report to the Director of the Office of Management and Budget (OMB) confirming compliance and detailing which, if any, of their functions are legally required to continue.
Funding Restriction: The OMB Director is instructed to reject future budget and grant requests from these agencies to the extent they are inconsistent with the order's directive to eliminate or reduce functions.

Stated Purpose (from the Sponsors):

The White House states that the purpose of this order is to continue efforts to reduce the size of the federal government, which it has determined contains unnecessary elements.

To enhance accountability, reduce government waste, and refocus resources.
To save taxpayer dollars and streamline government priorities by cutting entities deemed a "waste of taxpayer dollars."
To return power to local communities and state governments by reducing the federal footprint.

Key Facts:

Affected Sectors: Labor Relations, International Media, Academia, Arts and Culture, Social Services, Community Development, Minority-Owned Businesses.
Timeline: The order was signed on March 14, 2025, with agency compliance reports due by March 21, 2025.
Scope: The order has a national scope, affecting federal agencies that provide services, grants, and coordination across the United States and, in the case of USAGM, internationally.

The Backstory: How We Got Here

Timeline of Events:

Post-War Era and Great Society (1940s-1960s):

The foundation for several of the targeted agencies was laid during periods of expanding government roles. The Federal Mediation and Conciliation Service (FMCS) was established in 1947 by the Taft-Hartley Act to promote stable labor-management relations. The U.S. Agency for Global Media (USAGM), which oversees Voice of America, has roots in Cold War-era broadcasting to counter Soviet propaganda. The Minority Business Development Agency (MBDA) was created by executive order in 1969 to address racial disparities in business ownership.

Late 20th Century: Bipartisan Support for Community and Culture (1980s-1990s):

Several other targeted agencies were created with broad support to address specific social issues. The U.S. Interagency Council on Homelessness (USICH) was authorized in 1987 under the McKinney-Vento Homeless Assistance Act to coordinate the federal response to homelessness. The Community Development Financial Institutions (CDFI) Fund was established in 1994 to provide capital to financial institutions serving low-income communities. The Institute of Museum and Library Services (IMLS) was created in 1996 to provide federal support for the nation's museums and libraries. The Woodrow Wilson International Center for Scholars was established by Congress in 1968 as a non-partisan think tank.

Why Now? The Political Calculus:

"Dismantling the Administrative State": The order is a key component of a long-held conservative goal to reduce the size and power of the federal bureaucracy, often referred to as the "administrative state" or "deep state."
Department of Government Efficiency (DOGE): The Trump administration created a new entity, the "Department of Government Efficiency" (DOGE), led by prominent business figures, to identify federal waste and recommend cuts. This executive order is a direct outcome of that initiative.
Partisan Distrust: There is a significant and growing partisan divide in confidence regarding federal employees. Recent polling shows that while a large majority of Democrats trust federal workers, a majority of Republicans do not, viewing the bureaucracy as inefficient at best and politically hostile at worst. This provides a political mandate for actions that reduce the federal workforce.
Fiscal Pressures and Rhetoric: The action is framed as a necessary measure to control government spending and reduce national debt, a consistent theme in Republican messaging.

Your Real-World Impact

The Direct Answer: This directly affects specific groups who rely on these agencies' services and funding—including small business owners, cultural institutions, local governments, and those in labor disputes—but the downstream effects could be felt more broadly.

What Could Change for You:

Potential Benefits:

Proponents argue that eliminating these agencies will save taxpayer money and reduce government waste, which could theoretically contribute to lower taxes or a reduced national debt in the long run.
Streamlining the federal government could, according to supporters, lead to more efficient and accountable operations.

Possible Disruptions or Costs:

Short-term (First Year):

Loss of Funding: Local libraries and museums could lose access to federal grants from IMLS, which in 2024 distributed $266.7 million for professional development, literacy programs, and cultural preservation.
Business Support Disappears: Minority-owned businesses would lose a dedicated federal agency (MBDA) that in FY23 helped secure $1.5 billion in capital and $3.8 billion in contracts.
Community Investment at Risk: The CDFI Fund, which leverages every $1 in federal funds to attract $8 in private investment for things like affordable housing and small businesses in low-income areas, would be gutted.

Long-term:

Labor Disputes: Without FMCS mediation, labor strikes in the private and public sectors could become more frequent and longer-lasting, potentially disrupting supply chains and services.
Homelessness Response: The coordination of federal efforts to address homelessness through USICH would cease, potentially hindering national strategies and support for local governments.
International Information: The significant reduction of USAGM could diminish the reach of U.S.-funded news sources like Voice of America and Radio Free Europe/Radio Liberty in countries with limited press freedom.

Who's Most Affected:

Primary Groups: Minority entrepreneurs, libraries and museums (especially in smaller communities), low-income communities seeking investment, unions and management in contract disputes, and non-profits and local governments working on homelessness.
Secondary Groups: The general public who uses libraries and museums, communities benefiting from new businesses and affordable housing, and consumers impacted by labor strikes.
Regional Impact: The impact will be diffuse, but communities with a high concentration of minority-owned businesses and areas relying on CDFIs for economic development may be disproportionately affected.

Bottom Line: The order will likely lead to a significant reduction in federal support for cultural institutions, minority businesses, and community development, while its effect on government efficiency and cost-savings remains to be seen.

Where the Parties Stand

Republican Position: "Rein In Big Bureaucracy"

Core Stance: The federal government is bloated, wasteful, and inefficient, and many of its agencies are unnecessary or overstep their authority.

Their Arguments:

✓ Eliminating non-essential agencies and programs is a crucial step to cutting wasteful spending and reducing the national debt.
✓ The "administrative state" has grown too powerful, and returning functions to the states and the private sector is a core principle of good governance.
⚠️ While some functions may be necessary, they should be streamlined and reduced to their absolute legal minimum.
✗ Taxpayer money should not fund programs that are not core to the federal government's responsibilities, such as arts, culture, and certain forms of business development.

Legislative Strategy: To support the President's executive actions to dismantle parts of the federal bureaucracy and use congressional authority to defund or eliminate agencies through the budget process.

Democratic Position: "Protecting Critical Services"

Core Stance: These agencies provide vital services and support to American communities that the private sector cannot or will not provide.

Their Arguments:

✓ These agencies support vulnerable populations, promote economic opportunity for marginalized groups, and enrich American culture and society.
✓ The programs run by these agencies, like the CDFI Fund, are successful public-private partnerships that leverage federal dollars to create significant economic impact.
⚠️ The President is overstepping his authority by attempting to dismantle agencies created by Congress without legislative approval.
✗ Gutting these entities will harm local economies, increase social inequality, and weaken America's standing in the world.

Legislative Strategy: To publicly oppose the executive order, challenge its legality, and use the appropriations process to attempt to restore funding for the targeted agencies.

Constitutional Check

The Verdict: ⚠️ Questionable

Basis of Authority:

The Executive Order is issued "By the authority vested in me as President by the Constitution and the laws of the United States of America." This generally refers to the President's executive power under Article II to oversee the executive branch.

U.S. Constitution, Article II, Section 3: "[The President] shall take Care that the Laws be faithfully executed..."

Constitutional Implications:

[Separation of Powers]: The core legal question is whether the President can effectively abolish or cripple an agency that Congress created by statute. The order attempts to do this by directing the OMB to "reject funding requests." This raises significant questions about the President's power of the purse, which Article I of the Constitution grants to Congress.
[Precedent]: The Supreme Court has previously limited a President's ability to unilaterally withhold funds appropriated by Congress (an act known as "impoundment"). In Train v. City of New York (1975), the Court ruled that the President could not simply refuse to spend money that Congress had directed to be spent.
[Federalism]: While the order's stated goal is to return power to the states, critics argue it does the opposite by removing federal partners and funding streams that state and local governments rely on for key initiatives like homelessness and economic development.

Potential Legal Challenges:

Legal challenges are highly likely. Critics argue that the President cannot unilaterally defund and dismantle agencies that Congress established through law. Lawsuits could be filed by affected stakeholders (such as grant recipients or states) or based on the argument that the executive order violates the separation of powers by usurping Congress's funding and legislative authority. The order's directive to "eliminate" non-statutory functions and reduce statutory ones to a minimum could be challenged as an illegal attempt to repeal legislation through executive action.

Your Action Options

TO SUPPORT THIS EXECUTIVE ORDER

5-Minute Actions:

Contact the White House: Use the White House comment line or website to express your support for reducing the federal bureaucracy.
Call Your Rep/Senators: [Capitol Switchboard: (202) 224-3121] "I'm a constituent from [Your City/Town] and I support Executive Order 14238. I urge [Rep./Sen. Name] to support efforts to cut wasteful government spending and reduce the size of the federal bureaucracy."

30-Minute Deep Dive:

Write a Letter to the Editor: Submit an opinion piece to your local newspaper arguing that the order is a necessary step to rein in government spending and overreach.
Join an Organization: Find and support advocacy groups that promote limited government and fiscal responsibility.

TO OPPOSE THIS EXECUTIVE ORDER

5-Minute Actions:

Call Your Rep/Senators: [Capitol Switchboard: (202) 224-3121] "I'm a constituent from [Your City/Town] and I urge [Rep./Sen. Name] to oppose Executive Order 14238 and protect funding for agencies like the Institute of Museum and Library Services and the Minority Business Development Agency."

30-Minute Deep Dive:

Write a Detailed Email: Contact your congressional representatives and the members of the House and Senate Appropriations Committees, detailing how the services provided by the affected agencies benefit your community.
Join an Organization: Support organizations that advocate for the arts, libraries, minority businesses, or other sectors affected by the order. Many of these groups will have active campaigns against these cuts.