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Trump administration cancels $1.5 billion in blue-state federal grants

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Trump administration cancels $1.5 billion in blue-state federal grants

The Trump administration’s budget office told FOX Business Wednesday that it is canceling $1.5 billion in blue-state grants, citing concerns about how funds are being managed in California, Colorado, Illinois and Minnesota.

The Office of Management and Budget (OMB) said it will target projects at the Department of Transportation (DOT) and the Centers for Disease Control and Prevention (CDC), cutting $943 million and $602 million, respectively.

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An OMB spokesperson told the New York Post that the states were being targeted due to “waste and mismanagement” of taxpayer funds.

The announcement follows OMB launching a sweeping review of federal funding for several Democratic-led states in January, which required states to submit detailed receipts proving no funds were being mishandled, CBS News reported.

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The Office of Management and Budget is planning to cancel over $1 billion in grants from the Department of Transportation (DOT) and the Centers for Disease Control and Prevention (CDC). (Stephen Goin / Fox News)

The initiative reflects a shift in fiscal policy toward “America First” priorities by withholding funds from states that maintain sanctuary policies or projects the administration deems wasteful. 

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Concerns cited include tax support for illegal immigrants, green initiatives and alleged fraud in certain states, such as the $250 million COVID-era scam in Minnesota uncovered in the “Feeding Our Future” case.

Several DOT and CDC programs in blue states could be affected by the funding cuts, including equity-focused infrastructure projects and public health initiatives the OMB previously criticized as “social engineering” rather than legitimate public health efforts. 

“The use of Federal resources to advance Marxist equity, transgenderism, and Green New Deal social engineering policies is a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve,” the OMB previously said in 2025. 

TREASURY SECRETARY ANNOUNCES CASH REWARDS FOR MINNESOTA FRAUD WHISTLEBLOWERS

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US President Donald Trump speaks to members of the media on the South Lawn of the White House before boarding Marine One in Washington, DC, US, on Tuesday, July 15, 2025. Trump will announce $70 billion in artificial intelligence and energy investments in Pennsylvania on Tuesday, the latest push from the White House to speed up development of the emerging technology. Photographer: Al Drago/Bloomberg via Getty Images

The Trump administration’s budget office is canceling $1.5 billion in funding for DOT and CDC projects in four blue states over funding misuse concerns. (Al Drago/Bloomberg via Getty Images / Getty Images)

In January, Trump halted more than $10 billion in federal childcare and social services funding to four states, as well as New York, over concerns that some benefits had been fraudulently funneled to noncitizens, the Post reported

In California, San Francisco was slated to receive $15 million to expand its electric vehicle charging network, with a focus on “disadvantaged communities that are marginalized by underinvestment and overburdened by pollution,” city officials said in 2025. 

Similarly, the California Reducing Disparities Project, an equity-focused public health program serving marginalized communities, including racial minorities and LGBTQ+ populations, was awarded $60 million over six years.

Chicago has drawn scrutiny for its initiatives focused on diversity, equity and inclusion. 

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The Biden-era Red Line Extension and the Red and Purple Modernization Programs, which together total approximately $2.1 billion, were paused in 2025 pending a review of “race-based contracting” practices.

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CDC research may be subject to potential cuts. (Nathan Posner/Anadolu Agency via Getty Images / Getty Images)

Additionally, funding for CDC research on sexually transmitted diseases affecting “adolescents and young adults, gay, bisexual, and other men who have sex with men” may be subject to potential cuts. The project, which listed Chicago as a recipient, was in line to receive $7 million, The Post reported.

In October 2025, the Trump administration labeled federal funding for various climate and renewable energy initiatives as a “Green New Scam” and subsequently terminated or paused $7 billion in grants, with Colorado among the primarily affected states, according to local media CPR News

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The Trump administration may expand grant cancellations in the future amid concerns about systemic failures in sanctuary city leadership, which surfaced prominently following Minnesota’s fraud schemes.

The governors of California, Colorado, Illinois and Minnesota did not immediately respond to FOX Business’ request for comment.

Fox News Digital’s Greg Norman contributed to this report. 

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Dollar rebounds as Middle East tensions reignite, Hormuz closed

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Oil prices rebound 7% as Strait of Hormuz is closed again

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How small businesses could save thousands on fuel as gas prices rise: expert

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How small businesses could save thousands on fuel as gas prices rise: expert

High gas prices continue to squeeze small businesses across the U.S., but cutting one costly habit could help owners save significantly.

New data from Ford Pro, the commercial vehicle division of Ford Motor Company, shows that unnecessary idling — leaving a car running while parked — can cost fleet operators thousands of dollars each year, cutting directly into margins at a time when fuel prices remain high.

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According to the U.S. Department of Energy, the average fleet vehicle idles between one and two hours per day, burning up to two gallons of fuel daily per vehicle. With gas prices rising, those costs can add up quickly.

As of Sunday, the national average price for unleaded gas stood at $4.04, up from $3.88 just a month ago, according to AAA.

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2019 Ford Motor Co. F-150 pickup trucks are displayed at a car dealership in Orland Park, Illinois, U.S., on Friday, Sept. 27, 2019. Auto sales in the U.S. probably took a big step back in September, setting the stage for hefty incentive spending by carmakers struggling to clear old models from dealers' inventory

Ford Motor Co. F-150 pickup trucks are displayed at a car dealership in Orland Park, Illinois, on Sept. 27, 2019.  (Daniel Acker/Bloomberg via Getty Images / Getty Images)

“You can burn up one to two gallons of gas just doing that,” Matt Krukin, who leads software and digital growth for Ford Pro, told FOX Business. “So if that happens per day… that’s $8 a day that’s idling.”

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For businesses operating multiple vehicles, the impact can be substantial. A 20-vehicle fleet idling for two hours a day could waste more than $160 in fuel every day, according to Ford Pro.

Excessive idling is particularly common in North America, where about 29% of fleet vehicles idle unnecessarily, compared to just 10% in Europe, Krukin noted.

To help address the issue, Ford Pro is investing in software and data-driven tools.

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A person pumps gas into a car. (Sean Gallup/Getty Images / Getty Images)

Its newly launched artificial intelligence (AI) assistant allows fleet managers to monitor vehicle behavior in real time, identify inefficiencies and coach drivers to adopt more fuel-efficient habits. 

Ford Pro says customers using these tools have seen measurable improvements, including a 52% reduction in idling.

While reducing idling is one of the simplest ways to cut costs, other driving behaviors — such as aggressive acceleration, rapid braking, and speeding — can also increase fuel consumption and wear on vehicles, according to Krukin.

The system can even limit acceleration, while in-cab alerts provide real-time feedback.

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Cars are seen driving on the highway. (Jonas Walzberg/picture alliance via Getty Images / Getty Images)

“It’s like the fleet manager’s right next to them to coach them along the way,” Krukin said.

Users have also seen a 25% drop in speeding, a 16% decrease in hard braking and an 11% reduction in harsh acceleration, according to Ford Pro.

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“We’re not just recommending solutions for the heck of it,” Krukin said. “… At the end of the day, it’s really about bringing it all together, so that these fleets actually get a pleasurable experience with the tools and technology coming together.”

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Eli Lilly in advanced talks to acquire Kelonia Therapeutics for over $2 billion, WSJ says

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World Bank Highlights AI Boom as a Bright Spot Amid Slowing Growth in East Asia and the Pacific

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Asia Pacific Defies Global Slowdown in Sustainable Finance

Growth across East Asia and the Pacific is losing momentum this year, weighed down by an energy shock, rising trade barriers, and persistent domestic vulnerabilities, but a surge in artificial intelligence-related trade and investment is offering a rare point of optimism, according to the World Bank’s latest regional economic report.

Key takeaways

  • AI-related exports and investment surged across East Asia and the Pacific in 2025, with Malaysia, Thailand, and Viet Nam leading the way.
  • Regional growth is forecast to slow to 4.2% in 2026, pressured by the Middle East energy shock, trade barriers, and weak domestic demand.
  • Closing gaps in connectivity and skills is essential for the region to fully capture the productivity benefits of AI.

Regional growth is projected to slow to 4.2% in 2026, down from 5.0% in 2025, as the energy shock stemming from the Middle East conflict compounds the adverse impact of elevated trade barriers, global policy uncertainty, and domestic economic difficulties.

China, the region’s largest economy, is expected to decelerate from 5.0% growth in 2025 to 4.2% in 2026 and 4.3% in 2027, as weak domestic demand and property sector challenges persist and the global slowdown weighs on exports. The rest of the region is forecast to slow to 4.1% in 2026 before rebounding to 5.0% in 2027 as geopolitical tensions ease.

Against that difficult backdrop, the World Bank’s East Asia and Pacific Economic Update: Industrial Policy in the Digital Age identifies AI as a meaningful bright spot. The report highlights surging AI-related exports and investment in 2025, particularly in Malaysia, Thailand, and Viet Nam, as a notable positive development for the region.

Yet the Bank cautions that the full benefits of AI remain out of reach for much of the region. Adoption is constrained by gaps in connectivity and skills, with only 13 to 17% of multinational subsidiaries in China and Thailand currently using AI, roughly one third of the proportion seen in industrialised countries.

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The report also examines how rising energy costs could deepen hardship for ordinary households. A sustained 50% increase in fuel prices could result in a 3 to 4% loss in income for households across the region, with the poor and small and medium enterprises identified as the most vulnerable.

On a longer-term strategy, the update argues that industrial policy, if carefully designed, can help unlock productivity gains. Targeted support for specific industries in the Republic of Korea, Malaysia, and, more recently, Viet Nam proved effective in part because those countries had strengthened their economic foundations, including infrastructure, education, and regulatory institutions, and had liberalised trade and investment. The Bank warns that similar efforts elsewhere have delivered weaker results where those foundations remain fragile.

World Bank Vice President for East Asia and the Pacific Carlos Felipe Jaramillo noted that while the region continues to outperform much of the world, sustaining growth will require confronting structural challenges and seizing the opportunities of the digital age to increase productivity and create more jobs.

World Bank Group Director of Research Aaditya Mattoo cautioned that present difficulties could increase economic distress and inhibit productivity growth, adding that measured support for people and firms could preserve jobs today while reviving stalled structural reforms could unleash growth tomorrow.

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