Now that the House and Senate have hammered out a spending deal for the rest of fiscal year 2024, the deadlock over Ukraine aid will come into renewed focus once lawmakers return from their Easter break early next month.
With a Senate-passed supplemental spending bill that includes $60 billion in Ukraine military assistance languishing unconsidered, House Republican lawmakers — the majority of whom are believed to back continued support for Kyiv — have pitched other mechanisms to keep the aid flowing.
Some have suggested only dispatching military aid while abstaining from humanitarian support, others have pushed for a loan, and some have suggested the possibility of tapping into frozen Russian assets to help foot the bill.
Military only aid
Many critics of renewed support for Ukraine have made hay about how past tranches of aid helped fund pensions, schools, hospitals, and other non-military needs in Kyiv.
“The president said that it’s really important that we keep funding pensions in Ukraine. I would observe that the US Census Bureau says that in 2022, the US pension shortfall is $1.4 trillion,” Rep. Matt Gaetz (R-Fla.) complained during a hearing last year.
The supplemental package that cleared the Senate last month included $1.6 billion to help Kyiv’s private sector, and about $8 billion to help its government continue to function.
Some have suggested that the US scrap the soft support and focus strictly on lethal military hardware.
Under that scenario, however, “the Ukrainian government will rapidly not be able to function,” Brian Stokes, a visiting senior fellow at the German Marshall Fund who has studied Ukraine, tells The Post.
“It seems like a very facile and easy way for Republicans to feel like they aren’t giving away taxpayer money when in fact, they could be consigning the Ukrainian government to failure — and not failure on the battlefield but failure internally,” added Stokes, who explained that economic pressure and damage to critical infrastructure caused by the fighting have left Kyiv officials dependent on multi-layered assistance.
Loaning Ukraine aid
Another option is to simply loan Kyiv what it needs.
Last month, former President Donald Trump voiced support for packaging aid to Ukraine in the form of a loan that it would eventually be expected to repay.
That idea appears to have gained some steam among Republican lawmakers. Last week, for instance, Sen. Lindsey Graham (R-SC) met with Ukrainian President Volodymyr Zelensky and argued in favor of the loan option.
“When someone is in the process of drowning, they’ll take any lifeline,” says John Herbst, a former US ambassador to Ukraine in the George W. Bush administration.
Ukraine may be inclined to accept such an offer, but there are questions about whether they will be able to repay it.
“There’s no path for them — in multi-decades, probably — where they would ever have any possibility of paying it back. So I think that’s just a marketing gimmick,” says retired Lt. Col. Daniel Davis, a senior fellow at the Defense Priorities foreign policy think tank who opposes efforts to marshal more assistance to Ukraine.
Other experts are concerned about the long-term toll a loan could exact on Ukraine, especially during its future reconstruction efforts.
“If you put money in as a loan, even on terms that are forgivable, any other investor becomes potentially subordinated to that loan,” explained Douglas Rediker, a nonresident senior fellow at the Brookings Institution.
“Private investors [would be] even less likely to support Ukraine going forward because they know in a crunch, the US government would get repaid first,” Stokes said. “Frankly, what we need is for private investors to be willing to buy Ukrainian bonds.”
Cashing in frozen Russian assets
Shortly after Moscow’s tanks rolled into Ukraine, Western nations moved to freeze an estimated $280 billion worth of Russian sovereign central bank assets. This includes roughly 210 billion euros ($228 billion), the EU estimates it has in stasis at Belgian financial services company Euroclear.
Meanwhile, the amount of US-controlled Russian assets are thought to be much smaller. Estimates vary, but the US has at least $5 billion in central bank assets, per the Russian Elites, Proxies, and Oligarchs Task Force. Some estimates claim the amount of frozen assets broadly immobilized by the US is between $40 billion and $60 billion.
A number of lawmakers, including House Speaker Mike Johnson (R-La.), have floated the idea of tapping into Russia’s frozen assets to help foot the bill for Ukraine’s efforts to fend off Moscow.
This past week, European leaders agreed in principle to take the interest off those assets and funnel it to Ukraine, much to the outrage of the Kremlin. This would amount to roughly 3 billion euros ($3.2 billion) and Europe would begin wiring that to Ukraine as early as July, according to European Commission President Ursula von der Leyen.
“Given the fact that we’re not at war with them, to take another country’s money because we don’t like what they’re doing sets a huge precedent,” Davis warned when asked about the US following a similar route.
Numerous iterations of the Rebuilding Economic Prosperity and Opportunity for Ukrainians Act (REPO Act) have circulated in Congress and would authorize the president to confiscate Russian reserves in the US.
However, there are concerns that such a move could threaten the US dollar’s perch as the most dominant world reserve currency.
“Central bank reserves are generally supposed to be out of reach of any claims against them. They are sacrosanct under central banking practices,” Rediker said. “The exception to that is if you are at war with another country…we are not technically at war with Russia.”
“The argument against doing so is you have now created a window for other countries that might also be guilty of bad acts, to say, ‘Wow, we should take our money out of the US Federal Reserve System, because it is now potentially subject to seizure.’”
Herbst, the former ambassador who is now the senior director of the Atlantic Council’s Eurasia Center, scoffed at the suggestion that seizing the assets and transmitting them to Ukraine would be an unnecessary slap at Russia.
“Oh, that’d be really provocative,” he said sarcastically. “Nothing like launching a war, murdering tens of thousands of people, and kidnapping 20,000 kids.
“If you look at what Russia has done in occupied Ukraine, it’s war crime after war.”
Stokes acknowledged that the US and Europe will eventually use the Russian assets to some purpose, telling The Post “that horse has left the barn.”
Philip Zelikow, a senior fellow at Stanford University’s Hoover Institution, argued the assets would be better used to fund Ukraine’s reconstruction efforts rather than the war itself.
“It is appropriate to look to the Russian assets to help address Ukraine’s financial needs, especially for reconstruction and recovery,” he said. “Military assistance, however, is best provided with taxpayer support, as an investment in our own defense – and with much more efficiency and less cost than the alternatives.”
The traditional approach
Past batches of Ukraine aid entailed military and humanitarian support without strings attached. Since August of last year, President Biden has pleaded with Congress to do the same this time around.
Johnson has argued that before any such action is taken, the White House must explain in detail Ukraine’s military objectives — whether it is the prevention of losing any more territory to Russia, the ejection of Russian forces from the eastern Donbas region, or the return of Crimea following its annexation by Moscow in 2014.
“This war is not winnable militarily for Ukraine under any circumstances. Russia’s power is only going to continue to grow over time,” Davis argued. “For the US Congress, the issue is, why do you want to give it $60 billion for something that can’t be militarily accomplished?”
Other commentators disagreed with that assessment.
“If the United States continues to support Ukraine the way it has, Russia will not be victorious,” Herbst insisted. “If we stop providing roughly comparable assistance, or if we were to cut off assistance entirely, the chances of a Russian victory are much higher. It would be a disaster for American interests.”
Herbst steered clear of using the phrase “Ukrainian victory” but instead underscored that the objective is to deny Russia the ability to “take political control of Ukraine.”
“This is not just for Ukraine, this is the war for [the] liberal international order. Just look at how unstable the world has become last year [as] this perception of the Western failure spread,” added Maria Snegovaya, a senior fellow at the Center for Strategic and International Studies.
One of the most prominent opponents of additional aid, Sen. JD Vance (R-Ohio) has argued that the US simply lacks the manufacturing capacity necessary to help Ukraine prevail.
While Herbst disagrees with Vance’s opposition to replenishing aid, he concurs that the US military-industrial capacity is not up to snuff.
“What we’ve learned in Moscow’s big invasion of Ukraine is that we don’t have enough weapons to deal with … a Russian attack on NATO or a Chinese attack on Taiwan, even if we didn’t send one bullet to Ukraine,” he said.
“We’re learning a ton of stuff about weapons efficiency for a future war.”
Herbst believes that the Biden administration needs to be less reluctant to send Ukraine offensive weaponry, such as F-16 fighter jets, Abrams tanks, tactical missiles with a range of 300 km (186 miles) and electronic warfare components.
Proponents of aid have also highlighted the fact that most of the money is being used to revitalize US military-industrial capacity.
“Those [weapons sent] were often several if not multiple years old,” Stokes said. “We’re replacing them with more up-to-date armaments…it’s actually spurring us to up our game a bit.”
When will Congress tackle Ukraine aid
At the moment, congressional leadership hasn’t outlined a clear path forward on passing Ukraine aid.
“It was important for us to not put the supplemental in front of the appropriations bills because it would affect, probably, the vote tally ultimately on the appropriations and we had to get our government funded,” Johnson told The Post last week during the House GOP retreat in West Virginia.
Johnson demurred on a specific timeline.
The appropriations bill barely cleared the House last Friday and afterward, Rep. Marjorie Taylor Greene (R-Ga.) flashed a motion to vacate as a “warning” — something she also previously threatened to do if Johnson moves a Ukraine supplemental.
Congress is now in recess, with the House returning April 9.
Meanwhile, half a world away, Ukraine has been battered by munition shortages as it seeks to fend off Russian invaders and there are growing concerns about a new offensive in the summer.
But getting the military hardware to Ukraine will take time.
“It’s not as if the day after the president signs it, the stuff gets loaded onto airplanes,” Stokes emphasized. “We’re likely to be, I would say, at the very least about six months late in terms of moving this aid, and time matters in war.”
