

The law does allow you to withhold payments to someone who owes you. For example, it’s legitimate to withhold rent from your landlord as long as you are setting it aside and have a legitimate habitability case ongoing.
This should follow the same logic
No, it would be blue states (not just California) setting aside in escrow money owed to the federal government, while pursuing a legal suit for the federal government to follow through on its commitments. This is a legit approach for an individual with a complaint against a business like a landlord, so it seems like you could pursue similar logic