White House drops attempt to cancel $4 billion in foreign aid

Move represents a change of course on policy front

By Jennifer Hansler and Sarah Westwood, CNN
Drew Angerer/2017 Getty Images

WASHINGTON (CNN)d - The White House has dropped its attempt to move forward with a controversial plan to eliminate up to $4 billion in foreign aid funding without congressional approval, several officials confirmed Thursday.

A source familiar told CNN that it was President Donald Trump's decision not to move forward with the plan. The move represents another change of course from the White House on a major policy front.

With his pursuit of foreign aid cuts scrapped, Trump also conceded one of the last remaining battles of the year to demonstrate his administration has tried to address the ballooning deficit. He agreed to a budget deal earlier this summer that contained far more spending increases and fewer offsets than his team set out to secure through negotiations, and assured Republicans support of the deal was acceptable because "there is always plenty of time to CUT!"

The planned rescission package faced opposition from bipartisan lawmakers and foreign policy advocates to the move that could have cut up to $4 billion in funding to the State Department and the US Agency for International Development.

"The President has been clear that there is fat in our foreign assistance and we need to be wise about where US money is going, which is why he asked the admin 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.

Two sources told CNN that there was a meeting about the rescission package at the White House on Thursday. That meeting included acting White House chief of staff and Office of Management and Budget Director Mick Mulvaney, OMB Deputy Director Russell Vought and Treasury Secretary Steven Mnuchin, a congressional aide said.

The Trump administration has sought to decrease what it believes is wasteful spending and make foreign aid more conditional on support for US policies. White House officials believed they had the authority to cancel the already-appropriated funds without congressional approval.

Had the administration pushed forward with the rescission package, lawmakers may have tried to replenish the money in the next round of fiscal talks in the fall, something that could have been a flashpoint ahead of the September 30 deadline to avoid another government shutdown.

 

Strong opposition

 

Behind the scenes, congressional appropriators from both parties and State Department officials had lobbied the White House to back off the planned cuts. Senate Foreign Relations Committee Chairman Jim Risch, an Idaho Republican, discussed the matter over the last few weeks with Trump and members of the cabinet, the congressional aide said. Risch also joined his fellow foreign committee leaders in a letter opposing a potential cancellation of the funds.

House Speaker Nancy Pelosi, a California Democrat, wrote to Mnuchin on Friday requesting that he "work within the Administration to stop this proposed rescission which (Government Accountability Office) states is illegal, which violates the good faith of our budget negotiations, which important Republicans say is ill-advised, and which overrides Congress' most fundamental Constitutional power."

Opponents of the move also warned about the impact the cuts would have on national security and US foreign policy objectives. A senior administration official told CNN last week that the rescission package included money to the United Nations -- including some peacekeeping funds -- funding for the Northern Triangle countries of Honduras, Guatemala and El Salvador, and cultural programs.

Politico was the first to report the rescission package would not move forward.

It's another flip for the President when it comes to policy negotiations with the Hill.

Trump this month floated a capital gains tax reform measure -- indexing the tax to inflation -- only to dismiss it as "somewhat elitist" a day later. He said Tuesday he was considering a payroll tax cut, hours after White House aides had told reporters such a cut was not under consideration and a day before he said he was not actually planning any kind of tax cut. And he sent conflicting signals on gun control -- claiming he still has an "appetite" for tougher background checks on gun sales after privately cooling to the idea and before stressing the US already has robust background checks in place.

This is the second year in a row the OMB attempted to put forward a rescission package. The plan was dropped last year as well after widespread backlash, including from Secretary of State Mike Pompeo.

Pompeo was asked about whether he would support a rescission package not long after the news that it would not move forward. He seemed unaware that a decision had been made but noted that he had "been engaged in meetings" on the topic and they "were working on it even this morning."

"What I've consistently said with respect to every penny the State Department spends, including our foreign assistance budget, is we've got to get it right. We've got to make sure we are using it in ways that are effective, that American interests are represented in the way we spend that money. That certainly includes our foreign assistance program," he said during a press conference in Ottawa Thursday.

Liz Schrayer, the president of the US Global Leadership Council, said in a statement that "after weeks of internal deliberations, smart policy has clearly won the day."

"Americans can be pleased that the Administration recognized the importance of these vital foreign assistance programs for keeping America safe and on the global playing field," she said.

CNN's Kylie Atwood, Michael Conte and Manu Raju contributed to this report.

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