House Republicans are seriously weighing a push to claw back pandemic relief funding as they debate what spending cuts they’ll demand in exchange for their support in lifting the debt ceiling.
Unobligated funds, money Congress set aside in the American Rescue Plan for cities and states to use but that local officials have not yet decided how to spend, could help House Republicans reach their spending reduction goals without going after more popular programs.
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“We are $31.5 trillion in debt. There’s about $150 billion that is unobligated funds,” Rep. Byron Donalds (R-FL) told the Washington Examiner. “We should be pulling that back immediately.”
President Joe Biden has falsely claimed that Republicans want to cut Social Security and Medicare as part of their debt ceiling demands, something Republican leaders in both chambers of Congress have expressly rejected.
What they do want to cut, however, remains less clear.
“There is discussion about clawing back unspent COVID funds but not the specifics on which amounts we’re talking about,” Rep. Mike Johnson (R-LA) told the Washington Examiner. “There are some things that Congress overspent, they overestimated the need, and money is just sitting around in these state coffers.”
Some GOP lawmakers have said they want to bring federal spending down to pre-pandemic levels, potentially capping next year’s budget at 2019’s spending. Others say the cap for 2024 spending should stay at 2022 levels, offering a less severe approach.
And which specific programs or federal agencies should face the cuts necessary to bring future spending levels down is still up for debate.
That’s part of the reason, some Republicans have suggested, that the idea of retrieving unspent pandemic funding gained popularity in recent weeks. Such a move would reduce the federal government’s obligations without forcing more difficult fiscal conversations, which, according to Rep. Chip Roy (R-TX), is not necessarily a good thing.
“I’m happy to go claw back COVID money, but I want some of my Republican colleagues who keep talking about that to show me the dollars and show me the path. Don’t get distracted by shiny objects,” Roy told the Washington Examiner. “Yes, there’s probably $90 [billion] to $100 billion in unobligated money. Go get it. Fine. I’m for that. But there’s obligated, unspent money. If you want to go get that back from the states, be my guest, but you’re going to be in court.”
“Let’s focus where we need to focus: Stop spending money we don’t have,” Roy added. “Cut the bureaucracy back.”
State and local governments still haven’t budgeted for roughly 40% of the American Rescue Plan funds they received, according to a Brookings Institution tracker.
That would leave at least $140 billion available for House Republicans to target without touching state and local spending already on the books.
Johnson suggested one approach could involve pulling back some types of pandemic relief funding without requesting the return of others.
“We’re not talking about grants for law enforcement or any of the other priorities of government,” he said. “But there are potentially some pots of money out there that could and should be clawed back.”
Other Republicans have suggested that obligated pandemic funding, money that state and local governments have not yet spent but have budgeted for specific future initiatives, should be on the table as well.
“It’s my understanding that you’ve got about a hundred billion dollars that is not even allocated yet from the COVID funding,” Rep. Bob Good (R-VA) told the Washington Examiner. “And then you’ve got another $500 billion that’s been allocated but not spent. I hope we can claw that back.”
Beyond the disagreement over COVID-19 dollars, Republicans face an even larger rift over how to address military spending.
Some House Republicans want to cut the Pentagon’s budget; others think national security spending should stay off-limits.
Roy proposed capping nondefense spending at 2019 levels and forcing the Pentagon to negotiate less severe cuts to keep defense spending at 2023 levels.
A number of Republicans have floated cutting spending along the margins of the military budget without restructuring its core functions.
“I think that the woke military that the Left is trying to create is ripe for cuts, and so we can go there and dive into their budget to try and make strategic cuts,” Rep. Ben Cline (R-OK) told the Washington Examiner. “At the same time, we do need to protect our national security.”
House Republicans also see aid to Ukraine as a flashpoint in spending negotiations.
Some GOP lawmakers see the military support as vital, while others view the aid as low-hanging fruit.
“That’s a perfect place to stop spending right there,” Rep. Marjorie Taylor Greene (R-GA) said of Ukraine aid. “We can also start reeling in all of this COVID money that’s unspent.”
“With respect to Ukraine, I have said many times I fully support our efforts in Ukraine,” said Rep. Mike Lawler (R-NY). “[Russian President] Vladimir Putin cannot be successful in his mission.”
Lawler, whose wife has ties to the Ukrainian region, argued that “peace only occurs through strength” and suggested he wanted to see a revision to the federal budgeting process rather than cuts targeted to the Pentagon.
The debate over what Republicans should ask for in return for their support for a debt ceiling hike could split conservative and centrist members in much the same way as Speaker Kevin McCarthy’s (R-CA) fight for the gavel did last month.
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Roy expressed frustration with Republican colleagues who he said had little interest in deeper reforms.
“I’m tired of Republicans who don’t understand guns and butter,” he said. “I’m tired of Republicans who want to keep spending money for military without giving a crap about the debt that’s piling up around the ears of our kids and grandkids.”
