Consider this the natural follow-up to the La Résistance posturing from blue states and cities in response to immigration enforcement. If these jurisdictions want to create danger and violence around legitimate federal operations, Donald Trump has some options at hand. The nuclear option would be the Insurrection Act, which Trump has mentioned at times but has yet to use – although the situation in Minnesota, where Governor Tim Walz suggested the state was “at war” with the federal government and openly threatened to use the National Guard to oppose ICE, probably provided a sore temptation.
Instead, Trump has decided to hit these blue states and cities where it really hurts … their wallets. Yesterday in a speech at the Detroit Economic Club, Trump announced that any jurisdiction that claimed “sanctuary” for illegal aliens and refused to cooperate with the Department of Homeland Security would have all of its federal funding cut off:
“Starting February 1, we are not making any payments to sanctuary cities or states having sanctuary cities because they do everything possible to protect criminals at the expense of American citizens,” Trump said during his address at the Detroit Economic Club.
He continued, “It breeds fraud and crime and all of the other problems that come, so we’re not making any payment to anybody that supports sanctuary cities.”
Sanctuary cities often have policies limiting local law enforcement’s ability to cooperate with federal immigration officers.
The Department of Justice has identified 11 states as sanctuary jurisdictions, including California, Illinois, Minnesota and New York. The District of Columbia is also considered a sanctuary jurisdiction.
Only eleven? Perhaps the DoJ needs an updated list. Also, some cities have made similar declarations over the last two decades. Will the White House drill down to that level, or will they just start with these eleven states?
Either way, this is not just a rhetorical flourish. Trump reiterated the message on Truth Social this morning, with more capital letters:
EFFECTIVE FEBRUARY FIRST, NO MORE PAYMENTS WILL BE MADE BY THE FEDERAL GOVERNMENT TO STATES FOR THEIR CORRUPT CRIMINAL PROTECTION CENTERS KNOWN AS SANCTUARY CITIES. ALL THEY DO IS BREED CRIME AND VIOLENCE! If States want them, they will have to pay for them! MAKE AMERICA GREAT AGAIN!!!
If Trump succeeds at this, it will put most of these states into a critical budget crisis. California in particular already has massive shortfalls on its plate, and any interruption in federal funding would be catastrophic. The same would be true for the remaining states to varying degrees. A month ago, Minnesota revealed the state faces a $3 billion deficit in its projected biennial budget for 2028-9, although it has a projected $2.4 billion surplus in the 2026-7 budget. What’s driving these deficits?
- Healthcare costs: Officials are projecting a $1.4 billion increase in healthcare costs in the upcoming budget cycle and a $1.3 billion increase in the 2028-29 cycle compared to previous estimates. Officials said 90 percent of the increase stems from changes to the state’s medical assistance program. Officials say they are seeing more patients, higher costs per patient, and higher-than-expected rates paid to managed care organizations – which is the single largest factor.
- Education: Projected costs for education have risen by $115 million for the next budget cycle and $288 million for the 2028-29 cycle since the end of the legislative session. Officials said the increase is primarily because of higher-than-expected costs for special education and staff salaries.
- Property tax refunds: The state is projecting refunds that are $116 million higher than expected for the 2028-29 budget cycle.
One factor the budget officials did not blame for the looming shortfall was fraud.
No one should be surprised that Minnesota officials didn’t account for widespread fraud in government programs. Until very recently, Walz and other officials barely acknowledged it exists, and still claim the amounts lost are not significant. But even apart from fraud, the biggest areas of federal support coming into states like Minnesota are health care and education, with nutrition assistance a large additional area. And that support is already the subject of a court fight:
The U.S. Department of Agriculture has warned states that have refused to provide data on recipients of Supplemental Nutrition Assistance Program money that they’ll be docked administrative funds. A court fight over the request for information was already under way before the threat came. Money hasn’t been stopped yet.
The U.S. Department of Health and Social Services said last week that it was halting money from five Democratic-led states for daycare subsidies and other aid to low-income families with children over unspecified suspicions about fraud. A court put that on hold[.]
The administration has tried to use additional financial pressure against Minnesota, a state where it has also sent a wave of federal officers in an immigration crackdown. The Agriculture Department has said it’s freezing funding in the state — but without laying out many details.
A halt in these funding streams will immediately impact budgets and services in blue states. That will force leadership to take some accountability for the sanctuary policies they have adopted for almost no cost at all up to this point.
Still, the question remains whether Trump can actually halt federal funding in these programs and others. The administration has attempted similar actions over the past year, all of which are being held up in the courts. That includes a previous effort on this same policy:
In an executive orders last year, the president directed federal officials to withhold money from sanctuary jurisdictions that seek to shield people in the country illegally from deportation.
A California-based federal judge struck it down despite government lawyers saying it was too early to stop the plan when no action had been taken and no specific conditions had been laid out.
That case is still tied up in the courts, but this would allow the Trump administration to tailor the effort differently in order to deal with the court’s objection. That may not make much difference, however, as these funds are allocated by Congress to the states, and the authority to halt these payments may not rest entirely with the executive. Trump likely sees the fight as a way to exhaust blue states financially and politically while making clear that “sanctuary” policies will no longer be cost-free virtue-signaling options. And that would cost Trump a lot less than using the Insurrection Act.
Editor’s Note: Unelected federal judges are hijacking President Trump’s agenda and insulting the will of the people.
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