A Bigger Loan for Ukraine Through the IMF
A major point of contention has been whether to include International Monetary Fund reforms in a future Senate bill. IMF assistance was requested by President Obama and the Treasury Department, and Obama's 2015 budget plan would increase the U.S. quota at the organization by $63 billion, which will be transferred from an existing credit line. This means that Ukraine's loan limits would rise by 60 percent, allowing them to access $1.6 billion instead of $1 billion, a possibility that House Republicans aren't thrilled about. Republicans, already wary of the IMF, are concerned about the loss of American influence and "taxpayer exposure" as loan limits rise, reports Jonathan Weisman at The New York Times.
The U.S. is also delaying the implementation of a 2010 agreement by all IMF member countries to increase the organization's lending capacity to $733 billion, and giving emerging markets like China more clout, Bloomberg's Kathleen Hunter and James Rowley report.
Do Sanctions Against Russia Make Sense?
It's possible that the Senate bill will include some form of sanctions against Russia, although The Hill reports that House Republicans are less than enthusiastic. Some European countries, including France and Germany, are reluctant to pass sanctions because of their reliance on Russian energy. A House vote on a non-binding sanctions measure is scheduled for Tuesday, and suggestions for sanctions include a U.S. boycott of the G-8 Summit in Sochi in June.
Republican Rep. Ed Royce wants any eventual sanctions to be “crippling,” Politico's Seung Min Kim reports. “The action by Russia cannot go unchallenged,” Royce said.
American Businesses Get Nervous Over Sanctions
The proposition of placing sanctions on Russia has caused some U.S. companies to voice their concerns over their consequences. According to Alexander Bolton at The Hill, companies with significant business interests in Russia include Boeing, Ford Motor Co., Pepsico and General Electric. U.S. trade sanctions on Russia amount to $40 billion, while Europe's trade sanctions amount to $460 billion.
Republican Push Their Domestic Energy Agenda
House Speaker John Boehner already floated the idea of increasing natural gas exports to put pressure on Russian President Vladimir Putin, but now some Republicans seem to be trying to hitch domestic energy provisions to the Ukraine package. Wyoming Sen. John Barrasso will introduce an amendment that would speed up exports of domestic liquefied natural gas to Ukraine and NATO countries. Kentucky Sen. Rand Paul is also advocating for decreased dependence on Russian oil by ramping up U.S. exports.
Paul believes that the U.S. should suspend loans to Ukraine as it could inadvertently benefit Russia. “We should also suspend American loans and aid to Ukraine because currently these could have the counterproductive effect of rewarding Russia. Ukraine owes so much money to Russia that American would essentially be borrowing from China to give to Russia,” Paul wrote in an op-ed in Time magazine.