President Donald Trump's budget office has rescinded an order freezing spending on federal grants, less than two days after it sparked widespread confusion and legal challenges across the country, according to two people familiar with the matter. "There was a short term pause or a funding freeze on certain discretionary spending payments, such as government grants, only for us to quickly look at the scams, dishonesty, waste and abuse," Trump said. "As was explicitly stated, this in no way affected Social Security, Medicare, Medicaid or other entitlements that Americans depend on," he added. White House suspends order on federal grant freeze after widespread backlash and confusion A two-sentence memo from the Office of Management Budget canceled a previous memo issued two days before that had directed federal agencies to “temporarily pause all activities related to obligations or disbursement of all federal financial assistance.” The Monday evening memo from the White House Office of Management and Budget sparked uncertainty over a crucial financial lifeline for states, schools and organizations that rely on trillions of dollars from Washington and left the White House scrambling to explain what would and wouldn't be subject to a pause in funding. The reversal was the latest sign that even with unified control of Washington, Trump's plans to dramatically and rapidly reshape the government has some limits.