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Senate on track to pass Ukraine aid bill

March 26, 2014

WASHINGTON (AP) — The U.S. Senate is on track to approve sanctions against Russia and aid for Ukraine after Democrats withdrew a provision requiring International Monetary Fund reforms.

Opposition Republicans’ rejection of the IMF measures had been blocking Congress from issuing a sharp response to Russian President Vladimir Putin’s military intervention in Crimea.

Lawmakers said the plan was to get one version accepted by both sides, pass it and get it to President Barack Obama’s desk as early as Thursday night. It was unclear whether the work could be finished that quickly.

Republican House Speaker John Boehner said Wednesday that both sides were discussing ways to get a bill out of Congress soon. Asked whether he expected problems reconciling the two bills, Boehner said, “You never know. But there’s an awful lot of cooperation and discussion under way to try to avoid that.”

Sen. John McCain, a Republican, said he hoped the House would adopt the Senate version of the bill, but that even if they were forced to negotiate a final measure, the process would not be lengthy because the two versions were similar.

McCain pushed to strengthen provisions in the Senate bill that call for additional defense equipment and military training to countries in central and eastern Europe, including Ukraine.

“Vladimir Putin is on the move,” McCain said in a speech on the floor in which he called Russia a “gas station masquerading as a country.”

Democrats backed down Tuesday and stripped IMF reform language from the bill, which had stalled its progress. With tens of thousands of Russian troops massed on Ukraine’s eastern border, Senate Democrats decided it was more important to denounce Russia, codify sanctions against Putin’s inner circle and support Ukraine rather than push right now for the IMF changes.

Democrats wanted the Ukraine legislation to include provisions to enhance the IMF’s lending capacity, but Republicans were opposed. And since more than two weeks have passed since Russia’s incursion into Crimea, Democrats decided it was important to move quickly to provide $1 billion in loan guarantees to Ukraine and sanction Putin’s inner circle.

The IMF provisions would have increased the power of emerging countries in the IMF and shifted some $63 billion from a crisis fund to a general account the lending body could use for economic stabilization operations around the world.

Republicans have long spurned the administration’s attempt to ratify the IMF revisions, saying they would increase the exposure of U.S. taxpayers in foreign bailouts. Making the shift now, opponents argue, also would marginally increase Russia’s voting power over the fund’s finances.

The Obama administration and Democrats counter that unless the U.S. approves the new rules, Washington will lose its influence at the IMF and hamper the body’s ability to avert economic meltdowns in places precisely like Ukraine. The U.S., which has veto power at the IMF is its largest shareholder, is the only major country that has yet to sign off on the IMF changes.

Eight Senate Republicans introduced an amendment to the Senate measure to remove the IMF provisions.

Senate Majority Leader Harry Reid, a Democrat, said he strongly supported IMF reform, but the main thing was to get the aid to Ukraine.

“We have to get IMF reform. But we can’t hold up the other,” Reid told reporters Tuesday. “As much as I think a majority of the Senate would like to have gotten that done with IMF in it, it was headed to nowhere in the House.”

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