By Alexander Bolton - 03/10/14 08:46 PM EDT
The White House and Congress are seeking a unified front against the Russian invasion in Crimea, but legislation to help Ukraine faces obstacles.
Congress is scheduled to be on recess next week, and failing to pass a relief package before lawmakers head out of town would be an embarrassing setback for President Obama as well as GOP and Democratic leaders on Capitol Hill. It could also lead the parties to devolve into finger-pointing, which would weaken U.S. leverage.
The Obama administration has insisted on attaching International Monetary Fund (IMF) reforms to the Ukrainian aid package. Republicans, however, have balked at the proposal.
Senate Foreign Relations Committee Chairman Robert Menendez (D-N.J.) is working with Sen. Bob Corker (Tenn.), the panel’s ranking Republican, on a package that could include sanctions on Russia.
Sen. Ben Cardin (D-Md.), a member of the Foreign Relations Committee, said Menendez and Corker would like to move a more comprehensive bill, but might settle for a straight aid package such as the one passed by the House last week.
“They’ve been working all weekend, I was told, and they have not reached agreement,” he said.
Corker told reporters Monday evening that a markup would not happen before Wednesday. A few minutes later, Menendez said he still hoped to tackle a Ukraine bill on Tuesday.
Thorny amendments, ranging from missile defense to natural gas exports, could be a problem at both the committee level and on the Senate floor.
House Republicans have shown little enthusiasm for adding sanctions to the Ukrainian aid package that passed the lower chamber 385-23 last week.
Despite the administration’s IMF-related concerns, not one House Democrat voted no. House Republicans say the best strategy for passing legislation promptly would be for the Senate to adopt the House measure, which would authorize $1 billion in loan guarantees to the new Ukrainian government.
“If they want to get anything done this week, they really just need to pass the House-passed bill,” said a House GOP aide.
U.S. corporations have expressed concerns in recent days that placing sanctions on Russia could hurt their bottom lines. Boeing, Ford Motor Co., Pepsico and General Electric all have substantial business interests in Russia.
Bilateral U.S. trade sanctions on Russia amount to only $40 billion compared to an estimated $460 billion in trade between Europe and Russia.
Senate Majority Leader Harry Reid (D-Nev.) initially suggested passing separate bills to provide loan guarantees to Ukraine and impose sanctions on Russia. That plan could change, depending on what Menendez and Corker agree to.
If the Senate does not pass legislation this week, action will wait until late March or early April because the chamber has planned a weeklong recess starting on March 14.
Earlier this month, Obama urged Congress to pass a Ukraine assistance measure swiftly. He said both parties should be able to come up with a “unified position.”
White House press secretary Jay Carney on Monday made another pitch for attaching IMF reforms.
“We strongly support passing IMF quota reform legislation,” he said. “We’re not talking about additional funding. What we’re talking about is reform legislation that the president strongly supports. He believes it’s vital to our national security interests and to our support for Ukrainian sovereignty.
Carney warned Congress needs to act “soon.”
“The sooner the better,” he added.
Michael Steel, a spokesman for Speaker John Boehner (R-Ohio), said the IMF issue is irrelevant to the crisis in Ukraine.
“The IMF already has the authority and resources they need to act in Ukraine,” Steel said. “The White House is trying to use this crisis to press for a separate and unrelated policy they have long pursued.”
The proposed IMF reforms would allow the organization to move $63 billion between accounts. The administration unsuccessfully sought the provision as part of the omnibus spending bill that passed in January. Officials say that, once approved, the reforms would allow Ukraine to access $1.6 billion in relief funds instead of $1 billion.
In January, House GOP leaders told the administration they would approve the IMF language if the IRS would scrap a proposed rule governing 501(c)(4) groups. A Democratic source familiar with the negotiations said the GOP has not moved off that position.
Sen. Rand Paul (R-Ky.), who has emerged as a leading candidate for president in 2016, on Sunday criticized additional financial assistance to Ukraine.
“We should also suspend American loans and aid to Ukraine because currently these could have the counterproductive effect of rewarding Russia. Ukraine owes so much money to Russia that America would essentially be borrowing from China to give to Russia,” he wrote in an op-ed for Time magazine.
Paul and other Republicans have advocated for increased domestic energy production and exports to reduce Europe’s dependence on Russian oil and gas.
So far, Germany and France, Europe’s two largest economies, have been leery of imposing sanctions on Russian because of their reliance on Russian energy.
Paul said on “Fox News Sunday” that he wants to “get every obstacle out of the way for our expert of oil and gas.”
“I would begin drilling in every possible conceivable place within our territories in order to have production that we could supply Europe with if it’s interrupted from Ukraine,” he said.
House Budget Committee Chairman Paul Ryan (R-Wis.) said on CBS’s “Face the Nation” the House will move legislation to expedite liquefied natural gas (LNG) exports.
Boosting natural gas exports, however, has run into opposition from a coalition of environmental groups, such as the Sierra Club, and manufacturing interests.
Sen. Ron Wyden (D-Ore.), former chairman of the Energy Committee who now heads the Finance panel, is against the GOP idea: ”I support the Energy Department’s current, measured process for considering export requests. Calls to rubber-stamp LNG exports ignore the fact that expediting approvals won’t get gas to the Ukraine any faster.”
Sen. Debbie Stabenow (D-Mich.) has expressed concern that increasing exports will raise the price of natural gas, which could hurt manufacturers in the Midwest who have experienced a renaissance in part because of cheap energy.
Stabenow said in a statement that she has discussed with Energy Secretary Ernest Moniz the “importance of natural gas to our nation’s ability to create manufacturing jobs.”
Russell Berman contributed.