Will foreign aid survive as the US House divides over budget?

The U.S. Capitol building. Where will foreign aid end up in the debate on the 2016 budget? Photo by: James Palinsad / CC BY-SA

U.S. foreign aid hangs in the balance between a divided House of Representatives. On one side, there are those who want to save money; on the other, those who want to increase defense spending.

Together with the Senate’s budget resolution, which is due out Thursday, the House’s budget resolution usually acts as a blueprint for the final U.S. budget.

The House released its resolution Wednesday, proposing a 7 percent cut in foreign aid compared to U.S. President Barack Obama’s proposed 2.4 percent increase. It also drastically boosts funding to the Overseas Contingency Operations fund, marking an ideological shift for the Republicans, who just last year accused the president of abusing OCO.

OCO was originally established as an emergency fund to supplement the fight against terrorism in Afghanistan and Iraq. Because OCO isn’t constrained by budget caps, it has been widely criticized as a “stopgap” that lacks appropriate oversight. In recent years, OCO was used for the Syrian crisis.

"House [Republicans] are hoping to blow up OCO in order to provide relief to the Department of Defense," Kate Eltrich, a partner at Sixkiller Consulting, told Devex.

She added: "A lot of the defense hawks feel those caps are too stringent and that defense really needs an increase."

Both the House and Senate are under pressure from two factions of the Republican Party: one which hopes to maintain spending at sequestration levels to get out of debt by 2026, and the other which proposes to boost defense spending in response to increasing threats from abroad.

On the other hand, prominent Senate Republicans like Lindsey Graham of South Carolina and John McCain of Arizona, along with 70 other House Republicans, have pledged not to vote for a bill that exceeds the caps, which were set during sequestration in 2011.

The debate between fiscal prudence and strong defense isn’t unusual among House Republicans, who typically propose budget cuts to foreign aid. But the approach is new.

Georgia Rep. Tom Price, chairman of the House Budget Committee, has sponsored a resolution that, in some way, seeks to appease both fractions: It would cut foreign aid and, at the same time, increase the Defense Department’s share of OCO funding.

If the party unites on the budget, the benefits could pay dividends down the line for the Republican-dominated Congress.

A budget bill that passes both chambers could pave the way for “reconciliation” — a mechanism that allows the Senate to pass bills without a huge majority. If the budget bill passes, it blazes a trail for key tax reform later this year.

Will Congress come together to pass the 2016 U.S. fiscal budget bill? Where will foreign aid end up? Share your views by leaving a comment below.

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About the author

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    Molly Anders

    Molly Anders is a U.K. Correspondent for Devex. Based in London, she reports on development finance trends with a focus on British and European institutions. She is especially interested in evidence-based development and women’s economic empowerment, as well as innovative financing for the protection of migrants and refugees. Molly is a former Fulbright Scholar and studied Arabic in Syria, Jordan, Egypt and Morocco.