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Trump Administration Drops Proposal to Cut Foreign Aid After Intense Debate

WASHINGTON — President Trump on Thursday rejected a proposal from budget hawks in the administration to curb foreign aid spending after objections from Secretary of State Mike Pompeo and lawmakers from both parties, officials briefed on the decision said.

The White House’s Office of Management and Budget, which since 2017 has been led by Mick Mulvaney, the acting White House chief of staff, had spent much of August working on the proposal. It would have imposed an estimated $4 billion of cuts to foreign aid funding this year from money that Congress had approved but that the State Department and the United States Agency for International Department had not designated yet for specific programs.

In recent days, members of Congress, Mr. Pompeo and Treasury Secretary Steven Mnuchin lobbied against the package, questioning the legality and effect of the move less than two months before the end of the fiscal year. Mr. Pompeo, Mr. Trump’s most trusted cabinet official, won a similar argument against the budget office last August.

The latest retreat is another instance in which the administration and Capitol Hill, confronted with a ballooning deficit and national debt after the most recent round of tax cuts, have struggled to reach agreement over how to rein in government spending. A senior administration official, speaking on the condition of anonymity, said that the proposal was motivated by the president’s desire to trim the amount of money dedicated to foreign assistance, a tiny slice of the federal budget but one that conservatives have long targeted as unnecessary.

But reports of the proposal incited broad bipartisan pushback from lawmakers in the House and the Senate and opposition from Mr. Pompeo and other administration officials.

Mr. Trump, who had been involved in multiple conversations this week about the cuts, spoke on Thursday morning in the Oval Office with advocates on both sides of the issue. John Sullivan, the deputy secretary of state, and Mr. Mnuchin argued against the spending cuts while Russell T. Vought, the acting director of the budget office, and Mr. Mulvaney, both fervent opponents of government spending, pushed for the cuts.

The president, who often talks about cutting spending but has put little political muscle behind efforts to do so, ultimately decided the fight over $4 billion was not worth it, because of the pressure campaign from Mr. Pompeo and a barrage of calls from his allies on Capitol Hill. The budget deficit this year will reach $960 billion in the fiscal year ending Sept. 30, the Congressional Budget Office said on Wednesday.

Politico first reported that the White House had decided to definitively drop the plan to withdraw the funding, a process called rescission.

“Taxpayers want to make sure we’re deploying it properly,” Mr. Pompeo said of foreign aid while speaking on Thursday to reporters in Ottawa, “and this discussion we’re having on rescission is certainly part of that larger discussion.”

Leaders in Congress had strongly opposed the cuts.

“I request that you work within the administration to stop this proposed rescission,” Speaker Nancy Pelosi of California wrote in a letter on Friday to Mr. Mnuchin. The proposal, she added, “overrides Congress’s most fundamental constitutional power,” to set government spending.

Republicans had also urged the administration to avoid going through with the maneuver, which would have been carried out under a 1974 budget law that allows the president to ask lawmakers to vote to send the money back to the Treasury Department.

Senator Lindsey Graham of South Carolina and Representative Harold Rogers of Kentucky, the top Republicans on the appropriations subcommittees that oversee foreign aid allocations, were among the lawmakers who warned that the package of proposed cuts could not only derail diplomatic efforts, but also jeopardize the negotiations to fund the government into the new fiscal year.

“These cuts have the potential to undermine significant national security and antiterrorism efforts of our diplomats and international partners overseas,” the two men wrote in a joint letter. “We fear such a rescission package could complicate the ability of the administration and Congress to work constructively on future appropriations deals.”

Previous efforts by the Trump administration to stop spending money already appropriated by Congress failed. In May 2018, the Office of Management and Budget submitted to Congress a $15 billion package that covered cuts across a range of agencies. The cuts were approved by the House but were blocked by the Senate.

Under Mr. Mulvaney, the budget office had also tried to submit a package of foreign aid cuts to Congress last August. But Mr. Pompeo objected, and the package was never sent to Capitol Hill.

The effort this year began in earnest on Aug. 3, when the budget office sent a letter to the State Department and the aid agency ordering them to freeze spending of all funds in 10 broad foreign aid accounts. The office also said it wanted the agencies to give a full accounting of all the funds that had not yet been designated for programs.

The budget office relented a bit on the freeze as it put together the package of cuts. It ordered strict limits on use of the money, so that the State Department and aid agency could not spend more than an average of 2 percent of the unallocated funds a day, according to people briefed on the process.

Democrats said Mr. Trump’s decision on Thursday validated their arguments both that foreign aid had value to the United States and that Congress had the constitutional power to decide government spending levels.

“It is important for us all to recognize first and foremost our national security interests and Congress’s constitutional power of the purse as was acknowledged in a bipartisan way in the rescission discussion,” Ms. Pelosi said in a statement.


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