President Donald Trump scrapped a plan to cancel more than $4 billion in unspent foreign aid, following a bipartisan uproar from Capitol Hill, lawsuit threats from stakeholders and pushback within his own Cabinet.
Transmission of the rescissions request to cut unspent funds at the State Department and U.S. Agency for International Development was expected sometime this week. But “POTUS decided not to move forward,” one source with knowledge of Trump’s decision said Thursday.
The decision to drop the plan came after Oval Office talks Thursday that included Trump, Deputy Secretary of State John J. Sullivan, White House legislative affairs director Eric Ueland, acting White House Chief of Staff Mick Mulvaney and acting White House budget chief Russell Vought. Treasury Secretary Steven Mnuchin was patched in by phone, according to people familiar with the discussions.
Vought and Mulvaney have been advocating for the cuts, with critics pointing to accounts such as those that have funded Caribbean renewable energy projects and aid to Northern Triangle nations Trump believes haven’t done enough to stem the tide of migration to the U.S.
On the other side, Secretary of State Mike Pompeo has led the internal push to reconsider the cuts package, and Mnuchin has been sympathetic, including after his main negotiating partner on the recent two-year budget deal implored him to weigh in. House Speaker Nancy Pelosi, D-Calif., told him in a letter late last week that the foreign aid cuts would negate the “good faith of our budget negotiations” last month.
Mnuchin, as well as Ueland and Sullivan — Pompeo’s deputy who was present while the secretary was away in Canada — argued against the cuts package in Thursday’s meeting. They said the president would be better served by letting the appropriations process play out on Capitol Hill and preserving the bipartisan budget deal, according to people familiar with the talks.
Other top lawmakers, including the bipartisan leadership of the House Foreign Affairs and Senate Foreign Relations panels, as well as the top Democratic appropriators and the lead Republicans on the State-Foreign Operations spending subcommittees, also criticized the cuts push. They said it could disrupt fiscal 2020 spending talks this fall, with a deadline on Sept. 30 to pass at least a stripped-down stopgap measure to avert yet another partial government shutdown.
A senior administration official Thursday pinned the blame for revoking the rescissions plan on big spenders in Congress.
“The president has been clear that there is fat in our foreign assistance and we need to be wise about where U.S money is going. Which is why he asked the [administration] to look into options to doing just that. It’s clear that there are those on the Hill who aren’t willing to join in curbing wasteful spending,” the official said.
The Thursday talks followed a similar conversation Monday between Trump, Pompeo, Mnuchin and Ueland. Pompeo urged Trump to back away from the idea at that time, and White House officials were already mulling a smaller package that could satisfy both camps.
Proposing cuts so late into the fiscal year had also raised a legal quandary. That’s because the 1974 budget law that created the current rescissions process allows the president to freeze spending on certain programs for 45 days of a continuous legislative session, while lawmakers weigh whether to approve the proposed cancellations.
But given that authority to spend the funds would lapse anyway after Sept. 30, the process could essentially do an end-run around Congress and cut funding without lawmaker’s assent. One option under consideration was a lawsuit seeking an injunction against canceling the funds.
The Government Accountability Office concluded in December that such a move would violate the 1974 law as it would nullify a requirement that Congress approve any such cuts during that period or the money must be released. But OMB officials argued that the law was silent on the timing of a rescissions push, and there is precedent for similar moves dating back to the 1970s.
One 1975 case, in which the GAO sued for release of funds the White House sought to take back late in the year, was never settled in court as the Ford administration reversed course during the proceedings.
Paul M. Krawzak and John T. Bennett contributed to this report.