On the first day of the federal government shutdown, New York City is learning just how costly its commitment to “diversity, equity, and inclusion” policies could be under President Donald Trump’s administration.
Russ Vought, director of the White House Office of Management and Budget, announced Wednesday that roughly $18 billion in federal funding for two major New York City infrastructure projects has been frozen.
“Roughly $18 billion in New York City infrastructure projects have been put on hold to ensure funding is not flowing based on unconstitutional DEI principles,” Vought wrote on X. “More info to come soon.”
The projects affected are among the most significant in New York’s long-term transportation planning. One is the Hudson Tunnel Project, which would add a new passenger rail tunnel under the Hudson River, a vital corridor for Amtrak and New Jersey Transit. The other is the long-delayed Second Avenue Subway expansion, a project that has been discussed for decades and is seen as critical to easing congestion on Manhattan’s East Side.
In a follow-up post, Vought confirmed both projects are on ice, immediately sparking debate over whether the freeze was primarily about DEI or about politics.
The Associated Press noted that the timing suggested more than policy. Senate Minority Leader Chuck Schumer, a New York Democrat, has made the Hudson Tunnel Project one of his signature priorities. In 2023, Schumer locked in a $6.88 billion federal grant for the tunnel. At the time, he acknowledged the funding was partly a safeguard in case Trump returned to the White House and Republicans reclaimed the Senate.
Both of those things have now happened.
House Democratic Leader Hakeem Jeffries, who represents Brooklyn, also has a stake in the projects and has been one of Trump’s most vocal opponents in Congress.
The decision to freeze funding hits directly at the priorities of both New York Democrats who are central to the shutdown fight.
CBS News highlighted how the move reverberated beyond policy debates. For Schumer and Jeffries, it was a political gut punch delivered on the same day Democrats were already facing pressure for allowing the shutdown to drag on.
The broader context is that Trump has made rolling back DEI spending a cornerstone of his second administration.
During his first term, Trump signed an executive order restricting DEI training in federal agencies, though it was later rescinded by President Joe Biden.
Now, with Trump back in office and Republicans holding a Senate majority, the administration is applying that principle to billions of dollars in federal spending.
Vought framed the decision as a matter of constitutional principle. Supporters of the freeze argued online that taxpayers should not be forced to fund projects or programs that prioritize ideological commitments over core infrastructure needs.
“This is what accountability looks like,” one Trump supporter wrote on X. “No more DEI slush funds disguised as public works.”
Critics, however, accused the White House of weaponizing federal funding to punish political opponents. Some Democrats argued that the timing — the very first day of the shutdown — made it clear the freeze was aimed squarely at Schumer and Jeffries.
“This isn’t about DEI, it’s about Donald Trump flexing power,” one Democratic strategist said.
For New Yorkers, the practical implications are serious. The Hudson Tunnel Project is part of the larger Gateway Program, which seeks to modernize a century-old rail system that millions of commuters depend on.
Delays in federal funding could set the project back years, raising costs and leaving existing tunnels vulnerable to breakdowns. The Second Avenue Subway, meanwhile, has been in the works since the 1920s and has already been plagued by delays and cost overruns.
