The Trump administration concluded 2025 with a flurry of significant actions and policy reversals, marking a turbulent final day of the year. Key among these was an abrupt retreat from efforts to deploy federal troops in major U.S. cities and a nationwide freeze on childcare payments to states, alongside other controversial moves and legal developments.

Donald Trump announced a sudden climbdown from his attempts to impose federal troops in law enforcement roles on Democratic-run cities, ending attempted deployments from Los Angeles, Chicago, and Portland. This move represented a significant U-turn following months of tension between the federal government and local authorities. Trump, in a statement on Truth Social, claimed the troops had greatly reduced crime but their work was stymied by local opposition. The withdrawal followed a rare Supreme Court ruling on December 23, which refused to lift blocks on the Chicago deployment, effectively halting similar legal battles concerning Portland and Los Angeles. Despite the federal deployments, violent crime notably plunged dramatically across the U.S. in 2025, with homicides expected to drop roughly 20 percent—the largest one-year decline ever recorded. Washington D.C., which saw the largest deployment of approximately 2,000 National Guard troops, experienced a 31 percent drop in killings. The deployments, initially intended to protect Immigration and Customs Enforcement (ICE) agents and reduce crime, faced immediate legal challenges, with federal courts ruling Trump lacked authority without specific criteria, such as quelling a rebellion. The administration’s stance was also complicated by the shooting of two National Guard soldiers in D.C., one fatally, further fueling debate. While the Supreme Court has frequently backed Trump's broad assertions of presidential authority, this ruling was a rare setback, with three justices—Samuel Alito, Clarence Thomas, and Neil Gorsuch—publicly dissenting.

Separately, the Department of Health and Human Services (HHS) enacted a nationwide freeze on all childcare payments to states. An official indicated that funding would only be released once states could prove the money was being used “legitimately.” This action came shortly after HHS officials announced a similar freeze for Minnesota. The department's deputy secretary, Jim O’Neill, and assistant secretary, Alex Adams, unveiled a “defend-the-spend system” requiring “justification, receipt or photo evidence before we make a payment.” States will be compelled to provide extensive documentation, including attendance records, licensing, inspection and monitoring reports, and complaints and investigations. HHS spokesperson Andrew Nixon emphasized the onus on states to ensure legitimate use of federal taxpayer dollars. These changes were reportedly in response to a viral video by a self-described “independent journalist” and right-wing influencer, which purported to expose massive fraud at daycare centers operated by Somali Americans in Minneapolis. However, other news outlets have been unable to verify these claims, though allegations of exploitation of Minnesota’s social safety net have been covered previously. Trump intensified his xenophobic attacks on Somali Americans, including Representative Ilhan Omar, following the Minnesota funding freeze. Minnesota’s Democratic governor, Tim Walz, denounced the freeze as part of “Trump’s long game,” despite the state’s efforts to combat fraud.

In other significant developments, a U.S. appeals court agreed to allow the Trump administration to strip Medicaid funding from Planned Parenthood health centers in 22 states and Washington D.C., putting on hold a prior injunction. Public opinion reflected widespread concern over the healthcare system, with a record 23 percent of Americans believing it is in a “state of crisis” and 47 percent identifying “major problems,” according to a West Health-Gallup Center poll. The Kennedy Center reportedly adopted new bylaws earlier in the year that would limit voting to Trump-appointed trustees, a controversial move suggesting a long-held plan to install Trump’s name at the center. Economically, Wall Street finished 2025 near record highs, driven by ballooning tech valuations and hopes of lower interest rates, defying a year of economic uncertainty. Furthermore, Jack Smith, the former justice department special counsel, stated in a deposition that he never spoke to Joe Biden about his cases against Trump. An unsealed court order revealed that high-level justice department officials pushed for the indictment of Kilmar Ábrego García after his mistaken deportation and subsequent return to the U.S. Lastly, ICE reportedly planned a $100 million, one-year media blitz for what it termed “wartime recruitment.”