In a bold and unapologetic move, the Trump administration has slashed an entire federal agency amid a grinding government shutdown, sending shockwaves through Washington.
The Daily Caller reported that on Friday, the White House unleashed mass layoffs, completely dismantling the Community Financial Institutions Fund (CDFI) under the U.S. Department of the Treasury, while broader cuts ripple across federal departments as part of a strategy to shrink government and refocus spending.
The shutdown began on October 1, 2025, after Senate Democrats rejected a bipartisan spending bill, leaving government funding in limbo.
Since that deadlock, Senate Majority Leader John Thune has pushed the same bill six more times, only to be stonewalled by Democrats demanding $1.5 trillion for progressive priorities and limits on presidential budget authority.
Republicans have dismissed this counterproposal as a nonstarter, leaving the standoff unresolved as the shutdown hit its tenth day with a joint news conference by Thune and House Speaker Mike Johnson at the Capitol.
Amid this chaos, the administration, guided by Office of Management and Budget (OMB) Director Russ Vought—a staunch advocate for trimming federal bloat—had agencies draft reduction-in-force plans for programs lacking funding or alignment with President Trump’s vision.
The CDFI, employing 102 full-time staff per its latest 2025 report, was entirely wiped out on October 10, 2025, with every employee receiving a layoff notice.
Originally tasked with boosting economic opportunity in underserved areas through financial institution support, the fund has drawn fire for veering off course, with critics alleging it has become a vehicle for politicized agendas.
Administration officials pointed to questionable grants—like $4.9 million to an organization critiquing “whiteness” in development, $6.7 million to another hosting transgender-focused events, and support for clinics offering hormone therapy across all ages—as justification for its elimination.
President Trump, who issued an executive order in March 2025 to confine agencies to their legal mandates, has made no secret of his intent to cut programs seen as misaligned, saying during a Cabinet meeting on October 9, 2025, “We’re only cutting Democrat programs, I hate to tell you.”
While the zinger lands with a smirk, it underscores a deeper frustration among conservatives who view such initiatives as wasteful detours from core government functions—though one wonders if the axe fell too swiftly for the 102 now-jobless CDFI staffers.
Meanwhile, OMB’s Vought took to X on October 10, 2025, with a terse declaration: “The RIFs have begun,” signaling that the CDFI’s demise is just the opening act in a broader fiscal purge.
Yet, not everyone is cheering—federal unions, including the American Federation of Government Employees (AFGE) representing over 800,000 workers, have already launched lawsuits to halt these shutdown-tied layoffs, claiming they’re unlawful.
The total scope of job cuts across government remains murky, but with other moves like slashing $7 billion from prior energy initiatives and freezing billions in infrastructure funds for cities like New York and Chicago, the administration’s cost-cutting zeal is clear—and clearly contentious.
As the shutdown drags on, the question looms: Will these bold reductions withstand legal scrutiny, or will they become another casualty of Washington’s endless tug-of-war? One thing’s certain—this is a gamble that’s reshuffling the deck of federal priorities with a distinctly conservative hand.