--:-- [Theme music fades out]
--:-- Michael Barbaro: It's day 12 of the government shutdown. Now, President Trump is ordering mass federal layoffs.
--:-- Michael Barbaro: In a court filing, the Budget Office said more than 4,000 employees across several agencies will receive layoff notices.
--:-- Michael Barbaro: The shutdown of the U.S. government, for which there is no end in sight, has given the Trump administration an extraordinary amount of power to remake, and in some cases, to decimate, dozens of agencies.
--:-- Michael Barbaro: The departments of Commerce, Education, Homeland Security, and the CDC are just some of the agencies impacted.
--:-- Michael Barbaro: In many ways, it's a power that the administration learned how to wield during two extraordinary weeks back in January, when it systematically destroyed USAID.
--:-- Michael Barbaro: Today, Chris Flavell on what he learned from reconstructing the death of that agency from the inside.
--:-- Michael Barbaro: It's Tuesday, October 14th. Chris, throughout the government shutdown that's now entering its third week, the threat that the Trump administration has issued is that it might use the shutdown as the rationale to gut the federal bureaucracy further gut the federal bureaucracy.
--:-- Chris Flavell: Yeah. The moment feels like a lifetime ago. But think back to the first few days of the new Trump administration when, as you said, they wiped out an entire government agency, USAID, the Agency for International Development, in a matter of days.
--:-- Chris Flavell: And it was so complete and so sort of shocking at the time to basically get rid of 10,000 federal workers that I wanted to go back to it and understand what happened and what was the thinking behind it?
--:-- Chris Flavell: What was the strategy? And what I found out was there wasn't, in fact, a plan to kill off USAID, at least not at first.
--:-- Chris Flavell: It happened a little bit on the fly, sort of a series of decisions and clashes that built on each other to advance an agenda that is ideologically consistent, but not, it turned out, all that planned out.
--:-- Chris Flavell: They were looking for opportunities and willing to use them really aggressively when they came up.
--:-- Michael Barbaro: It's interesting that you have found that the obliteration of USAID was essentially improvised.
--:-- Chris Flavell: Because right now, during this shutdown, the threat of traumas to the federal government, like what happened at USAID, feels quite explicit.
--:-- Michael Barbaro: That's exactly right. And I think the reason the case study of USAID remains really instructive today is it shows how they were willing to improvise and how effective that could be.
--:-- Michael Barbaro: And I think that applies in an important way to the shutdown, where it tells us maybe the outcome of the shutdown will not be dictated just by what is strictly legal, but also outcomes that we couldn't have imagined when it began.
--:-- Michael Barbaro: Well, Chris, take us inside the story that you have pieced together of this two weeks during which USAID went from a fully functioning agency to ultimately vanishing.
--:-- Chris Flavell: Yeah, it's really the story of just a few key characters.
--:-- Chris Flavell: Let's start with a man named Jason Gray. Long-time federal civil servant worked at a number of big agencies crucially had only been at aid for about two years when he was picked at the very beginning of this administration almost without warning to be in charge of USAID.
--:-- Chris Flavell: Now the fact that Jason Gray didn't have the kind of experience someone would usually have to run an agency like USAID became important when, on that very same day, on the first day in office, Donald Trump signed an executive order freezing foreign aid.
--:-- Chris Flavell: That order wasn't surprising. He didn't indicate that he would just think similar. But something about that order trying to be really important.
--:-- Chris Flavell: It was actually unclear what it meant. The order confusingly said that the government would, quote, immediately pause new obligations and disbursements.
--:-- Chris Flavell: But a lot of the money that was flowing at USAID was for projects around the world already in existence.
--:-- Chris Flavell: So that left open the question, well, what happens to those? Should those stop as well?
--:-- Chris Flavell: The people I spoke with said the idea that President Trump would stop existing programs, which is sort of a little crazy, right? Probably illegal.
--:-- Chris Flavell: So they didn't even think that would be what it was.
--:-- Michael Barbaro: And in fact, it seems so obvious to the people inside USAID that they didn't give much thought.
--:-- Chris Flavell: And the result was most programs just kept continuing as they were.
--:-- Chris Flavell: But this is where we introduce our second main character. Pete Morocco was a key figure in the first Trump administration.
--:-- Chris Flavell: He had a stint actually at USAID in the closing months of that administration, was remembered as being very hard-charging, very aggressive, being very eager, I'm told, to enforce President Trump's agenda, and left people a little unhappy.
--:-- Chris Flavell: He eventually left after just a few months at USAID.
--:-- Chris Flavell: Well, Pete Morocco suddenly reemerges in the early days of the second Trump administration because he has a senior role at the State Department, where as director of foreign assistance, he has some authority over USAID.
--:-- Chris Flavell: And all of a sudden, just a few days into this new administration, he calls senior staff at USAID.
--:-- Chris Flavell: He says, hey, it's come to my attention that AID is still spending money in violation of the executive order.
--:-- Chris Flavell: This is a real problem. And he said he wanted to get to the bottom of it.
--:-- Michael Barbaro: Okay, so suddenly you have a clashing view of what this executive order says.
--:-- Chris Flavell: You got the newbie head of the agency, a little out of his depth, seeing the language of the order and saying, I'm all good.
--:-- Chris Flavell: You got the old line, hard-charging Trump figure coming in and saying, you're totally wrong here.
--:-- Chris Flavell: All spending is now done.
--:-- Michael Barbaro: So here we are. This is just like four days in to the new administration, senior officials at the top of USAID gather for a meeting in the agency's headquarters, just a few blocks from the White House.
--:-- Chris Flavell: And they said, no, you know what? We've looked at this. We think this is all above board.
--:-- Chris Flavell: The way we spend money can be complicated.
--:-- Chris Flavell: Perhaps they said to themselves, Pete Morocco just maybe doesn't understand the way money flows from USAID.
--:-- Chris Flavell: We can fix this.
--:-- Michael Barbaro: Right, problem solved.
--:-- Chris Flavell: And of course, that's not what happened.
--:-- Chris Flavell: The following Monday, this is one week into the new administration, Pete Morocco, for the first time, shows up at the USAID headquarters.
--:-- Chris Flavell: And he says he's there because he wants to keep on digging.
--:-- Chris Flavell: He's not convinced this problem is fixed.
--:-- Chris Flavell: And crucially, he's not alone.
--:-- Chris Flavell: He brings with him members of the Department of Government Efficiency.
--:-- Chris Flavell: He says they're there to help him figure out what went wrong.
--:-- Michael Barbaro: And I think people at this point, as we speak today, know all about Doge, right?
--:-- Chris Flavell: Doge is under Elon Musk and went around looking for severe cuts and for ways to hear it of staff.
--:-- Michael Barbaro: But this is just one weekend. People don't yet know at this point what Doge is all about.
--:-- Chris Flavell: They didn't yet realize just how serious it was for Doge to be in the building.
--:-- Chris Flavell: In fact, this is one of the first agencies that Doge went to.
--:-- Chris Flavell: It was only later that day that people began to realize what Doge was there to do.
--:-- Michael Barbaro: Because that afternoon, senior figures from Doge made a demand.
--:-- Chris Flavell: They went into Jason Gray's office with a list of 57 senior officials at USAID and said, we've done some digging.
--:-- Chris Flavell: We think these 57 people were involved in these payments.
--:-- Chris Flavell: We want them put on administrative leave and sent home.
--:-- Michael Barbaro: So suddenly, Doge is operating as kind of a search-and-destroy operation to find the culprits for who has allowed spending to occur in violation of this executive order.
--:-- Chris Flavell: They're kind of the enforcement arm of the Trump administration coming in to settle that matter.
--:-- Michael Barbaro: That's right.
--:-- Chris Flavell: But though that's the story they gave, the people I spoke with said it didn't really hold up because these 57 names weren't on closer inspection people who were likely to have anything to do with these payments.
--:-- Chris Flavell: This list of names was something quite different.
--:-- Chris Flavell: It was really the senior most people in leadership roles from around the agency.
--:-- Chris Flavell: And so what it came to look like was an attempt to decapitate USAID.
--:-- Michael Barbaro: Okay, so as all these folks are pursuing their own ends, and there a lot of anger in the air over the idea that rules are being broken what happens next?
--:-- Chris Flavell: A few days later, Doge comes back and presents to USAID officials what they call their evidence for why these 57 people should not get to come back to their jobs.
--:-- Chris Flavell: The evidence turns out to be painfully thin.
--:-- Chris Flavell: It consists of an email that one of the members of the Doge team sent his teammates a few days earlier in which he said, quote, look, I reviewed these AID payments since the order.
--:-- Chris Flavell: And then he lists some people who had access to the system.
--:-- Chris Flavell: And then he goes on to say, I could be wrong.
--:-- Michael Barbaro: So this is not the evidence required to end the career of 57 leaders at USAID.
--:-- Chris Flavell: That is the judgment of the professionals inside USAID.
--:-- Michael Barbaro: In particular, a gentleman named Nicholas Gottlieb, whose role is to oversee employee and labor relations at USAID.
--:-- Chris Flavell: So this Nick Gottlieb suddenly becomes another player in this saga.
--:-- Chris Flavell: He looks at this evidence and he says, no, I cannot agree to keep these senior leaders on leave based on this.
--:-- Chris Flavell: This is not sufficient.
--:-- Chris Flavell: And then Nick Gottlieb does two things that prove to be tremendously important to the future of USAID.
--:-- Chris Flavell: First, he sends an email to those 57 people saying, look, based on the evidence, I've got no basis for keeping you on leave.
--:-- Chris Flavell: But then, arguably more important, he sends a memo to Jason Gray.
--:-- Chris Flavell: He says he will report Doge's actions to the Office of Special Counsel, which investigates wrongdoing and protects whistleblowers and is meant to protect federal employees.
--:-- Michael Barbaro: Wow.
--:-- Chris Flavell: So Nick Gottlieb decides to stand up and fight all this and ask for an investigation into Doge's investigation inside of USAID.
--:-- Michael Barbaro: Yeah.
--:-- Chris Flavell: It's really impossible to overstate just what a big deal this was in the eyes of Doge and Pete Morocco and eventually the White House.
--:-- Chris Flavell: They viewed this as absolute insubordination.
--:-- Chris Flavell: Their view was, how dare this mid-level career federal civil servants tell us what we can and cannot do?
--:-- Chris Flavell: This is the deep state personified.
--:-- Michael Barbaro: This starts to look a lot like the deep state.
--:-- Chris Flavell: And it set the tone for what happened next.
--:-- Chris Flavell: This is just 10 days in to the administration.
--:-- Michael Barbaro: So right away, they find Nick Gottlieb and march him out of the building.
--:-- Michael Barbaro: Wow.
--:-- Chris Flavell: But they don't stop there.
--:-- Chris Flavell: They go to Jason Gray and they say, this action from your employee, from this Nick Gottlieb, it shows that you've lost control of the building.
--:-- Chris Flavell: So they demanded that Jason Gray try to regain control of the building.
--:-- Chris Flavell: And the way they wanted him to do it was to lock out the entire staff from their phone and email systems.
--:-- Chris Flavell: Lock out every single one of the thousands of people who work at USAID around the world from the technology they use to work at USAID.
--:-- Michael Barbaro: That's right.
--:-- Chris Flavell: But it's worth saying it's not clear how well thought out this idea was.
--:-- Chris Flavell: I've heard different versions of it.
--:-- Chris Flavell: Someone said not necessarily.
--:-- Chris Flavell: They just wanted to prepare a plan.
--:-- Chris Flavell: They wanted the option.
--:-- Michael Barbaro: But what Jason Gray heard by the accounts of everyone I spoke with was something that he viewed as too much.
--:-- Chris Flavell: He said we've got people in combat zones, people delivering food in Gaza, people fighting Ebola in Africa.
--:-- Chris Flavell: I cannot lock them out.
--:-- Chris Flavell: That will put them in physical danger.
--:-- Chris Flavell: I won't do it.
--:-- Michael Barbaro: People, he's really seeming to say, could die.
--:-- Michael Barbaro: That's right.
--:-- Chris Flavell: He said people could die, and that to him was the line he wouldn't cross.
--:-- Michael Barbaro: And what that sounded like to the administration was yet another example of insubordination from USAID.
--:-- Michael Barbaro: And within days, the agency would effectively be shut down.
--:-- Michael Barbaro: We'll be right back.
--:-- [Theme music fades in]
--:-- Michael Barbaro: So, Chris, once Jason Gray, the head of USAID, the Trump-appointed head of USAID, says you can't freeze every employee out of their computer system, their phone system, what comes next on this journey towards the end of USAID?
--:-- Chris Flavell: A lot of things happen really quickly.
--:-- Chris Flavell: One of them is, as of the next morning, Jason Gray has been removed from his post as head of USAID.
--:-- Chris Flavell: And that's really just the beginning.
--:-- Chris Flavell: We're now into the weekend.
--:-- Chris Flavell: This is just the second weekend.
--:-- Chris Flavell: I cannot stress enough.
--:-- Chris Flavell: We are less than two weeks in.
--:-- Chris Flavell: And this is when members of Doge begin to go in and really aggressively begin rooting through the files, turning off social media, shutting down the website of USAID.
--:-- Chris Flavell: Someone described it to me as akin to the face of USAID being erased.
--:-- Michael Barbaro: So over this weekend, you can tell that USAID is in real trouble.
--:-- Michael Barbaro: At the same time, thousands of staff members begin losing access to their email accounts and computer systems.
--:-- Michael Barbaro: So in the background, the agency is starting to be dismantled.
--:-- Michael Barbaro: But then it moves to the foreground.
--:-- Michael Barbaro: This is Sunday afternoon.
--:-- Michael Barbaro: We're about 13 days into the new administration.
--:-- Michael Barbaro: What breaks out into the public is a tweet from Elon Musk.
--:-- Michael Barbaro: And he writes, USAID is a criminal organization.
--:-- Michael Barbaro: Time for it to die.
--:-- Chris Flavell: Yeah, and in hindsight, you know, it's clear what that meant.
--:-- Chris Flavell: But again, remember at the time, this is also new.
--:-- Chris Flavell: People don't really know how much power Doge has and they don't know how much power Elon Musk has right in theory if one is to stick to the law, Elon Musk, who's not really a government employee, certainly doesn't have the authority to unilaterally end a congressionally mandated agency.
--:-- Michael Barbaro: So this tweet marks a funny transition from a world where those kinds of rules still matter to a world where, oh, maybe Elon Musk and Doge can just end USAID.
--:-- Michael Barbaro: Right.
--:-- Chris Flavell: And the next day is when you can really tell beyond a shadow of doubt, USAID is not going to survive.
--:-- Chris Flavell: Because?
--:-- Chris Flavell: Because early on that day, that Monday, two weeks in the administration is an even more aggressive tweet from Elon Musk.
--:-- Chris Flavell: And it reads, we spent the weekend feeding USAID into the wood chipper, could gone to some great parties, did that instead.
--:-- Michael Barbaro: From there, staff who worked in the Washington, D.C. headquarters were told to stay home.
--:-- Michael Barbaro: Later that day, the State Department sent Congress a letter saying they would move, reorganize or otherwise wind down USAID.
--:-- Michael Barbaro: It even said, quote, the remainder of the agency may be abolished.
--:-- Michael Barbaro: Chris, I just want to make sure I understand the sequence of what happened here based on your investigation.
--:-- Michael Barbaro: We get this pretty confusing executive order and a bunch of people at USAID who interpret it exactly as it's written.
--:-- Michael Barbaro: And that leaves folks like Pete Morocco convinced that there's rampant insubordination going on across the agency.
--:-- Michael Barbaro: Doge comes in, starts punishing people for being insubordinate, and within a week or so, Doge is shutting the whole place down.
--:-- Chris Flavell: That is correct.
--:-- Michael Barbaro: And what it feels like is revealed in your reporting is that, while an underlying ideology might be behind the way the Trump administration sees USAID from the beginning, right?
--:-- Michael Barbaro: Which is America first and foreign aid are not so compatible.
--:-- Michael Barbaro: So USAID was always going to be suspect to this administration.
--:-- Michael Barbaro: It feels like the speed with which the agency just evaporates has a lot more to do with a few individuals becoming furious at what feels like a very normal process of employees engaging in a back and forth push and pull around rules and process.
--:-- Michael Barbaro: And the reaction being nuclear, you know this is disobedience, this is resistance, we are going to destroy your agency as a result of it.
--:-- Chris Flavell: That's exactly right.
--:-- Michael Barbaro: And I think you're landing on a really important point, which is maybe those two things aren't totally separate, right?
--:-- Michael Barbaro: Maybe the style and substance of government here affect each other, right?
--:-- Michael Barbaro: The policy decisions that reflect the ideology get influenced and overtaken by sort of the style of government, the combativeness, the hostility towards career civil servants, the suspicion of the deep state.
--:-- Michael Barbaro: And that sort of hostility and animus comes to overtake or redirect the policy goals.
--:-- Michael Barbaro: And those two things, rather than remaining separate, become sort of a cycle.
--:-- Michael Barbaro: And they start reinforcing each other, leading to really aggressive and fast outcomes that at the beginning of just this short two-week period probably would have been pretty hard to predict because you had two combustible elements interacting at the same time.
--:-- Chris Flavell: Right.
--:-- Michael Barbaro: But a clear lesson to have emerged from this, and I know this is complicated, is that the greater the resistance from people inside of it to what people from the administration wanted, the greater the pain, the trauma, and the gutting resulted.
--:-- Michael Barbaro: I think that definitely describes what happened at USAID.
--:-- Michael Barbaro: And I think that is, in fact, the lesson that others took away from from AID and from this early period that it's easier not to fight.
--:-- Michael Barbaro: It's easier just to give in.
--:-- Michael Barbaro: And we see that in the behavior of some law firms of some universities.
--:-- Michael Barbaro: I don't know if that is, though, a general concept.
--:-- Chris Flavell: Another lesson might just be that USAID fought back in the wrong way.
--:-- Chris Flavell: They thought that just by appealing to the letter of the law and to accepted HR practices, they would be able to stop this administration.
--:-- Chris Flavell: They probably underestimated the degree to which officials would feel sort of personally chagrined when they said no to their demands.
--:-- Michael Barbaro: So the lesson of USAID to my mind is the steps the Trump administration will take to try to shut down an agency, the steps they'll take in response to what they perceive as insubordination, they're unexpected and they can seem really extreme.
--:-- Michael Barbaro: And USAID wasn't ready for it.
--:-- Michael Barbaro: But as you apply that lesson to the shutdown, I wonder if what we see is this is not a saga.
--:-- Michael Barbaro: This is not a battle that unfolds along lines that make any sense.
--:-- Michael Barbaro: This is not an administration that's following a particular strategy, but instead they're reacting, they're looking for openings, they're aggressively pushing those openings, and they've learned a different but maybe more important lesson from USAID.
--:-- Michael Barbaro: And that lesson is they can get away with things like this.
--:-- Michael Barbaro: The consequences don't always materialize.
--:-- Chris Flavell: In other words, if the Trump administration decides that the shutdown is licensed to go into an agency it doesn't like or wants to severely reduce, what the lesson of this all is for the Trump administration is they can probably do what they want.
--:-- Chris Flavell: And that was true before the shutdown, perhaps is even truer now that the government is in shutdown because it's concentrated the president's authority over funding.
--:-- Michael Barbaro: And once they make a decision to go into an agency, any decision, as we've talked about, any resistance could then be used to very unpredictably take something that seems small and turn it into something very big and use it as a rationale to transform, maybe even end an agency.
--:-- Michael Barbaro: One of the unexpected conversations that's emerged from the shutdown is even the Trump administration needing to grapple with, is the government important?
--:-- Michael Barbaro: And the reality of USAID is that since it happened so early, we now have had the longest time to think about the repercussions of it going away.
--:-- Michael Barbaro: And I think we'd be remiss if we didn't, for a moment, talk about what it has meant to the world that USAID is now gone.
--:-- Chris Flavell: Yeah, what it looks like in real life is people not getting HIV medication, mothers not getting life-saving care, starving children not getting emergency nutrition packets, countries that used to get political assistance to remain democracies not getting that help, infrastructure that used to get built for drinking water and sewage and electricity and schools not being built.
--:-- Chris Flavell: It looks like the opposite of progress all over the world.
--:-- Michael Barbaro: And it's already happening.
--:-- Chris Flavell: Right.
--:-- Michael Barbaro: And that is no doubt of enormous importance to the countries where USAID was doing that work, to the people doing that work.
--:-- Michael Barbaro: Foreign policy experts would tell you that over time, this meant a lot to America's ability to exercise soft power and influence around the world.
--:-- Michael Barbaro: But at the same time, if you go walk the streets of the United States and ask people, do they miss USAID and the work that it does?
--:-- Michael Barbaro: And people are being honest.
--:-- Michael Barbaro: I'm not sure the answer is going to be, we miss USAID.
--:-- Michael Barbaro: I think the answer is probably, what was USAID again?
--:-- Chris Flavell: And that might be the most striking lesson of all.
--:-- Chris Flavell: It showed the genius of Trump to recognize, maybe not part of a plan, maybe out of emotional spite, but ultimately to recognize that he could do what almost no president has done and end a major agency and gamble that it wouldn't cost him any meaningful blowback from the public.
--:-- Michael Barbaro: and as of now, it looks like he was right.
--:-- Chris Flavell: It looks like that gamble paid off, which raises the question in this shutdown, well, if it worked at USAID, maybe he'll try it at other agencies.
--:-- Michael Barbaro: Maybe when he threatens to close, quote, Democrat agencies, maybe he'll do it and maybe it'll work out for him again, just like it did at USAID.
--:-- Michael Barbaro: Well, Chris, thank you very much.
--:-- Michael Barbaro: We appreciate it.
--:-- Michael Barbaro: Great to be with you.
--:-- [Theme music fades in]
--:-- Michael Barbaro: We'll be right back.
--:-- [Theme music continues]
--:-- Michael Barbaro: Here's what else you need to know today.
--:-- Michael Barbaro: On Monday, Republican state lawmakers in North Carolina said that they would soon begin to redraw the state's congressional maps to assure another Republican seat in the U.S. House of Representatives before next year's midterm elections.
--:-- Michael Barbaro: The effort would make North Carolina the latest state to fulfill President Trump's goal of trying to retain Republican control of the House by gerrymandering congressional districts rather than winning competitive elections.
--:-- Michael Barbaro: This summer, Republican lawmakers in Texas redrew their state's election maps to create five new Republican-friendly House seats, while Republicans in Missouri redrew its maps to create one more Republican seat.
--:-- Michael Barbaro: Today's episode was produced by Michael Simon Johnson, Mary Wilson, Shannon Lynn, Diana Nguyen, and Claire Tennesketter, with help from Nina Feldman.
--:-- Michael Barbaro: It was edited by MJ Davis-Lynn, Liz O'Balen, and Michael Benoit.
--:-- Michael Barbaro: Contains music by Marian Lozano, Alicia Baitu, Dan Powell, and Pat McCusker, and was engineered by Alyssa Moxley.
--:-- Michael Barbaro: That's it for The Daily.
--:-- Michael Barbaro: I'm Michael Barbaro.
--:-- [Theme music fades out]
