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House Republicans aim to pay for Israel aid with cuts to IRS funds

House Speaker Mike Johnson, R-La., delivers remarks at the U.S. Capitol on Wednesday. House Republicans have since introduced a bill that would give some $14 billion to Israel and cut that same amount from the IRS.
Alex Wong
Getty Images
House Speaker Mike Johnson, R-La., delivers remarks at the U.S. Capitol on Wednesday. House Republicans have since introduced a bill that would give some $14 billion to Israel and cut that same amount from the IRS.

After three weeks without a speaker, the House is back in business and putting aid to Israel at the top of its to-do list.

On the same day House Speaker Mike Johnson took office last week, the Republican-led House passed a resolution declaring solidarity with Israel and pledging to give its government the funding needed to defeat Hamas.

Now they've introduced a bill aiming to do just that — but not without controversy.

The bill would send $14.3 billion to Israel without addressing funding requests for the war in Ukraine. Johnson's new bill would pay for the spending with $14.5 billion in cuts to the long-understaffed Internal Revenue Service.

Senate Democrats and the White House have called the bill a nonstarter. The bill also puts House Republicans at odds with many GOP senators, including Senate Minority Leader Mitch McConnell, R-Ky.

Democrats oppose the bill on two fronts. They say the Ukraine money cannot be separated from Israel and they say emergency funding of this type is not usually offset with cuts. White House press secretary Karine Jean-Pierre said Monday that "politicizing our national security interests is a nonstarter."

"Demanding offsets for meeting core national security needs of the United States — like supporting Israel and defending Ukraine from atrocities and Russian imperialism — would be a break with the normal, bipartisan process and could have devastating implications for our safety and alliances in the years ahead," she added.

The Biden administration seeks to link the fights against Hamas and Russia, with the president saying in a rare Oval Office address last week that "they both want to completely annihilate a neighboring democracy." Biden warned of more "chaos, death and destruction" — and ultimately higher costs for the U.S. — if they don't pay the price for their actions.

The White House asked Congress last week for nearly $106 billion, the vast majority for Ukraine, with the rest split up between Israel, the Indo-Pacific and the southern U.S. border. It's asking for $14.3 billion in funding for Israel — the same as the House's standalone bill — including for air and missile defense, military financing and embassy support.

But more than a year and a half into the war, House Republicans are increasingly opposed to sending aid to Ukraine for both fiscal and foreign policy reasons. Johnson opposed money for Ukraine before he became speaker, and has since advocated for limited spending and handling funding for Ukraine and Israel separately.

Johnson acknowledged the bill is likely to drive away Democrats, telling FOX News he intends to call Senate Majority Leader Chuck Schumer for a "direct and thoughtful conversation about this."

But Democrats are not alone in their objections. McConnell has repeatedly said the two issues are related. He specifically tied the two causes together on Monday in a speech introducing the Ukrainian ambassador to the U.S. at an event in Louisville.

"This is a moment for swift and decisive action to prevent further loss of life, and to impose real consequences on the tyrants who have terrorized the people of Ukraine and Israel," McConnell said. "And right now, the Senate has a chance to produce supplemental assistance that will help us do exactly that."

Still, Johnson stressed the need to prioritize standalone aid to Israel while offsetting the costs. He said standing with Israel is a "more immediate need than IRS agents."

"We're not just gonna print money and send it overseas," he said. "Because the other concern that we have that is overriding this is our own strength as a nation, which is tied to our fiscal stability. And that's a big problem that we have as well. We have to keep it in mind as we try to help everyone else."

Secretary of State Antony Blinken and Defense Secretary Lloyd Austin appeared in front of the Senate Appropriations Committee on Wednesday to make the case for continued U.S. aid to both countries. Their testimony was repeatedly interrupted by protesters calling for a cease-fire in the Middle East.

The IRS has said it will use its newly allocated funding to improve its technology, customer service and enforcement efforts.
Stefani Reynolds / AFP via Getty Images
AFP via Getty Images
The IRS has said it will use its newly allocated funding to improve its technology, customer service and enforcement efforts.

IRS funding has become a political flashpoint

The House bill would cut some $14 billion out of the $80 billion that Biden's 2022 Inflation Reduction Act allocated to the IRS, the agency that handles tax return processing, taxpayer service and enforcement.

The IRS has said it will use that money to update its decades-old computer systems, improve customer service and step up enforcement for collecting the estimated $600 billion in taxes that go unpaid every year, much of it from wealthy people who under-report their income.

In fact, earlier this month it launched a new initiative — using federal funding — aimed at ensuring large corporations pay the taxes they owe, among other efforts.

The IRS has been underfunded since the 1980s, according to the Brookings Institution. Its enforcement budget was slashed nearly a quarter in the last decade, and further cutting its budget remains a top Republican priority.

Johnson said the bill aims to take some of the IRS funds to deal with the immediate national security need, adding that "we'll deal with the rest of that issue later."

Maya MacGuineas, the president of the bipartisan Committee for a Responsible Federal Budget, told Morning Editionthat the idea of offsetting the cost of foreign aid is a sensible approach, given the U.S.' sizable deficit and debt.

But she says taking money away from the IRS — which she describes as probably the only federal program that pays for itself — is "not the smartest offset if what you want to do is be fiscally responsible."

"It actually doubled down on the borrowing by rescinding money that goes to the IRS, which would translate into a larger loss of money in collected revenues," MacGuineas says. "So that could be twice as expensive as the actual bill, if that were paired with pulling back some of the IRS funding."

Democrats opposed to the bill say the IRS needs this money to operate ahead of tax season, which begins in January.

Democrats don't want to set this precedent

Lawmakers on both sides of the aisle are likely to oppose the bill just based on precedent, not wanting to tie emergency funding — which Congress usually takes up separately — with spending cuts.

Senate Foreign Relations Chair Ben Cardin, D-Md., called it a "poison pill," while Rep. Debbie Wasserman Schultz, D.-Fla., said in a statement that Johnson's "political games are offensive to all pro-Israel Americans."

"When your neighbor's house is on fire, you don't haggle over the price of the garden hose," she added.

Emergency supplemental funding is used to address urgent crises, explained Rep. Rosa DeLauro, D-Conn., the ranking member of the House Appropriations Committee.

She said in a statement that House Republicans are setting a "dangerous precedent" by suggesting that responding to emergencies is contingent upon cutting other programs.

She took issue with other aspects of the bill, including that it does not include money for humanitarian assistance in the Middle East and also "abandons our allies in Europe and the Indo-Pacific and fails to include much-needed domestic investments."

"We are wasting time that our allies abroad and the American people living paycheck to paycheck do not have to spare," she said.

DeLauro called on House Republicans to come to the negotiating table to pass a comprehensive emergency supplemental package as well as 2024 full-year funding bills. The government will shut down if Congress can't pass a spending bill by November 17.

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Rachel Treisman
Rachel Treisman (she/her) is a writer and editor for the Morning Edition live blog, which she helped launch in early 2021.