IMF Funding Spat Shouldn’t Slow Ukraine Aid, Lowey SaysDerek Wallbank
Senate Democrats should drop their demand to tie an International Monetary Fund measure to Ukraine aid legislation so Congress can speed assistance to the country’s fledgling government, Representative Nita Lowey said.
“I think they should have passed the House bill yesterday or today; I think get that out and then consider the discussion on IMF and reform,” Lowey of New York, the top Democrat on the House Appropriations Committee, said at a Bloomberg Government breakfast today in Washington. “I was really surprised and very disappointed that they didn’t do that.”
The House bill, H.R. 4152, includes $1 billion in U.S.- backed loan guarantees to Ukraine. It lacks provisions sought by Democrats to boost the U.S. share of funding at the Washington-based IMF.
Republicans have resisted changing the IMF quota funding for several years. It was one of the last things to be left out of a government spending bill in January, Lowey said, as Republicans rejected arguments from her and Treasury Secretary Jacob J. Lew to include it.
Lowey believes Congress should immediately approve both the IMF language and the Ukraine aid, her office said later in an e-mailed statement.
“It is disappointing that Republicans have only allowed a vote to extend U.S. loan guarantees,” she said in the statement.
During the Bloomberg Government session, she said, “If the IMF reform was in place, it would have produced even more money and we would have had a greater role.”
President Barack Obama’s fiscal 2015 budget plan, sent to Congress on March 4, would boost the U.S. quota at the IMF by shifting about $63 billion from an existing credit line.
The U.S. is delaying implementation of a 2010 agreement by all IMF member countries to double the fund’s lending capacity to about $733 billion. The plan would give emerging markets such as China more clout at the institution, which was set up at the end of World War II to help ensure the stability of the global monetary system.
Changes to IMF funding are part of the Senate’s proposed Ukraine aid legislation, S. 2124. The bill would authorize $1 billion in loan guarantees and sanctions against Ukrainians and Russians deemed responsible for corruption and violence.
The Senate plans to take up the measure during the week of March 23, following a break next week.
“It’s extremely important for the country and the world that we be heavily involved in the IMF,” Senate Majority Leader Harry Reid, a Nevada Democrat, told reporters yesterday. IMF funding “has everything to do with Ukraine” because credit guarantees from the international agency are important to that country’s future, Reid said.
Ukraine faces $3.6 billion in debt repayments including interest through the end of June, according to data compiled by Bloomberg.
While the biggest hurdle is a $1 billion bond maturing on June 4, there are also payments due to the IMF, including the equivalent of about $670 million on April 30. Ukraine’s foreign-repayment needs will peak in May, June and August, Finance Minister Oleksandr Shlapak said in Kiev on March 5.
The IMF overhaul is backed by chief executive officers of major U.S. companies and Republican former secretaries of state Henry Kissinger and Condoleezza Rice, who have said funding the IMF would help Ukraine.
None of that has swayed House Republicans.
“The IMF money has nothing to do with Ukraine,” House Speaker John Boehner, an Ohio Republican, said yesterday as he repeated a call for the Senate to pass the House bill. “I understand the administration wants the IMF money, but it has nothing at all to do with Ukraine.”
On another issue, Lowey said Democrats will resist any changes to food-stamp spending that Republicans might propose after states boosted funds for a heat-and-eat program to dodge some of the $8.6 billion in food-stamp cuts enacted in a farm-policy law last month.
The home-heating subsidy is tied to increased U.S. food-stamp aid. At least six states, including Lowey’s New York, are triggering extra federal nutrition spending by adding money to the home-heating subsidy.
Boehner yesterday said states were “perpetuating a fraud” to get around the food stamp cuts and the House should act to stop it.
Lowey, 76, said Democrats would “absolutely” block any such move.
She also said she views legislation cleared by the Senate March 11, authorizing $12.6 million annually to expand pediatric medical research, as a commitment by Republicans to provide the federal funds to actually pay for it.
The measure, sent to Obama for his signature, abolishes public financing for the quadrennial Republican and Democratic conventions and allows the savings to be spent on pediatric research.
The bill has been a primary focus for House Majority Leader Eric Cantor. It was named for Gabriella Miller, a 10-year-old Virginian who died of brain cancer in October 2013.
“It is misleading to the public to think that this authorization will put a dime more in the appropriations process,” Lowey said. Authorization legislation sets spending levels, while appropriations bills actually provide the money.
She said she now expects Republicans who backed the bill to vote for annual federal research funding at least $12.6 million above levels enacted in fiscal 2014.