House passes $14 billion in Israel aid with costly cuts to IRS

[florida80]

11/2

The Republican-controlled House on Thursday approved legislation to send roughly $14 billion in emergency aid to Israel and cut about the same amount from the Internal Revenue Service, in a deeply divided vote on a measure that Senate leaders say they won’t take up and President Biden has already threatened to veto.

Biden in October requested $106 billion in emergency foreign aid for Ukraine’s defense against Russia’s invasion, Israel’s response to Hamas’s attacks and to counter Chinese influence in the Pacific.

New House Speaker Mike Johnson (R-La.) chose to split the Israel funding off from the rest of the aid and declared the House would cut the budget to pay for the spending to keep the federal deficit from growing.
But the cuts to the IRS would actually cost taxpayers money, meaning the aid for Israel would add to the deficit even more than just borrowing the $14 billion Biden wants to send, according to a nonpartisan analysis by the Congressional Budget Office. The move would reduce the tax agency’s ability to audit high-income earners and tax evaders, costing taxpayers $26.8 billion in lost tax revenue, the CBO projected. IRS Commissioner Daniel Werfel put the lost income at closer to $90 billion.

The legislation passed by a 226-196 vote, with 12 Democrats joining most Republicans to back it.

“We have obligations and we have commitments. And we want to protect and help and assist our friend Israel, but we have to keep our own house in order as well,” Johnson told reporters Thursday. “And I think people at home, I think the American people understand that. At home, you have to balance your budget. At home, you have to make tough decisions, and Washington should run the same way.”

House Democrats rejected that characterization and rushed to the defense of the IRS. The tax agency got roughly $80 billion in expanded funding in the Inflation Reduction Act in 2022, one of Biden’s signature legislative achievements.

Republicans took aim at the funding immediately upon taking control of the House this year, voting to rescind the money in a bill that died in the Senate. They’ve looked for opportunities to peel more of that funding away in subsequent spending bills. Rep. Kevin McCarthy (R-Calif.), then the House speaker, struck a deal with Biden in June to reprogram $20 billion of the IRS funding as part of an agreement to raise the federal debt limit.

“It’s something that, as policy, we’ve looked at since January,” said Rep. Brian Mast (R-Fla.), a U.S. Army veteran who has also volunteered to serve in the Israel Defense Forces. “We’ve done it in stand-alone legislation, done it in different places, I think it’s something that’s just been on the table and became an easy place to look as a pay-for.”

Democrats said the move against the IRS money was a pointless partisan stunt.

“Don’t say that somehow we’re offsetting the cost of our foreign aid package here. We’re not. That’s a joke,” Rep. Jim McGovern (D-Mass.) said Thursday on the House floor. “It’s an insult to the intelligence of the American people. It’s an insult to the members of Congress that serve in this institution.”

Rep. Jerrold Nadler (D-N.Y.) called the legislation “an insult to Jewish Americans.”

Senate Majority Leader Charles E. Schumer (D-N.Y.) said Thursday that the Democratic-controlled upper chamber “will not consider this deeply flawed proposal.”

Sens. Patty Murray (D-Wash.) and Susan Collins (R-Maine), the chair and vice chair of the Senate Appropriations Committee, respectively, are drafting a separate aid package to include Israel, Ukraine and Asia-Pacific defense funding, though it’s not yet clear how much money it would send.

“It still mystifies me,” Schumer said, “that at a moment when the world is in crisis — at a time when we need to help Israel to respond to Hamas — the House GOP thought it was a good idea to tie Israel aid to a hard-right proposal that will raise the deficit and is totally, totally partisan, all the while helping wealthy tax cheats get away scot free.”

Biden has said he would veto the House bill if it made it the Oval Office. Administration officials Thursday argued that linking Israel funding with money for Ukraine, defense against China and U.S.-Mexico border security was crucial to U.S. interests.

“All four are important,” National Security Council spokesman John Kirby told reporters at a White House briefing. “And the whole idea of an urgent supplemental is you’re submitting what you think are urgent requests. And the president wants to see all of them honored, all of them acted on by Congress, all of them together. We wouldn’t have submitted it that way if we didn’t believe that they all weren’t important.”

The House proposal turned what could have been an easy political win for the new speaker into a partisan fight that jeopardized crucial aid to the U.S.'s top Middle Eastern ally. It also previews, some GOP lawmakers said, the brash tactics many expect Johnson to employ in future bids to extract concessions from the Senate and White House.

Even Johnson’s bid to add a so-called pay-for to the Israel package is relatively unheard of — most emergency aid is not accompanied by compensatory spending cuts — signaling to the hard-right wing of the House GOP the speaker’s willingness to tangle with both Democratic and Republican Senate leaders over previously noncontroversial policies.

“They should respond and negotiate,” Rep. Chip Roy (R-Tex.), a member of the far-right House Freedom Caucus, said of the Senate, “not tell us we’re wrong.”

Amy B Wang contributed to this report.