Biden Calls for ‘Urgent Action’ on Israel Aid

Plus: The deficit rises to $1.7 trillion in 2023 ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ [The Fisc](   By Yuval Rosenberg and Michael Rainey Well, everything’s a mess. Here’s an update. "We stand with Israel," Biden vowed. (Reuters) House GOP Chaos Leaves Path for Israel Aid Uncertain As war rages on in Israel and Gaza, President Joe Biden and congressional leaders have pledged to provide emergency military support to Israel, but the lack of a House speaker and ongoing disarray among House Republicans are raising questions about just what the U.S. government might be able to do and how an aid package might be structured. Biden said Tuesday that at least 14 Americans were among the more than 1,000 killed in the barbaric assault by Hamas terrorists on Saturday, and American citizens are also being held hostage. Biden called the attack “an act of sheer evil” and said there is no justification for terrorism. “We stand with Israel. And we will make sure Israel has what it needs to take care of its citizens, defend itself, and respond to this attack,” Biden said in remarks from the White House. Biden said the United States is surging military assistance, including ammunition and rocket interceptors, and would look to do more. Israel now receives some $3.3 billion in military funding a year and the annual defense bill passed by the House and Senate earlier this year reportedly directed $80 million to Israel’s Iron Dome defense system. “When Congress returns, we’re going to ask them to take urgent action to fund the national security requirements of our critical partners,” Biden said. "This is not about party or politics. This is about the security of our world, the security of the United States of America.” Combining aid for Israel, Ukraine and Taiwan: As Biden’s comment about “critical partners” suggests, the administration and some lawmakers are reportedly looking at linking funding for Israel and Ukraine. “I think there’s discussion about putting Israeli funding with Ukraine funding, maybe Taiwan funding and finally border security funding. To me that would be a good package,” Rep. Michael McCaul, the Texas Republican who chairs the House Foreign Affairs Committee, told reporters Monday. In a Wall Street Journal op-ed published Monday, Senate Minority Leader Mitch McConnell also backed a broader emergency funding package. “Congress has the opportunity this fall to provide emergency appropriations to the Defense Department so that it can assist partners like Israel, Ukraine and Taiwan, as well as invest in our own military capabilities,” he [wrote](. “This should include significant replenishment funding, which allows us to expand and modernize our own weapons inventories. It should also include investments to expand our ability to produce critical munitions, long-range fires, and other essential defense technologies here in America.” Other Republicans want to keep Israel and Ukraine aid [separate](. “Aid to Israel needs to be focused on Israel,” Republican Rep. Jim Banks of Indiana [wrote]( on X. “Lumping support with Ukraine funding needlessly holds up aid to our most important ally in their hour of need.” Further complicating matters, the House GOP conference is also still working to figure out who it wants to succeed Kevin McCarthy as speaker. House Republicans met this evening in the Ways and Means Committee room to hear from their two leading candidates for the gavel, Reps. Steve Scalise of Louisiana, the House majority leader, and Jim Jordan of Ohio, who heads the Judiciary Committee. Heading into the meeting, neither man had enough support to win a floor vote, according to reports, leaving tremendous uncertainty over a planned Republican conference vote Wednesday to pick a nominee. Whoever the next speaker is, they will have to navigate ongoing Republican opposition to Ukraine funding, as Karoun Demirjian of [The New York Times]( lays out: “Democrats and Republicans are divided, even within their own party ranks, over whether the broad political consensus behind backing Israel’s war effort might help break the logjam over sending more military supplies to Ukraine, or simply complicate the heavily politicized negotiations over doing so. A growing number of Republicans are resisting continued aid for Ukraine and suggesting that any additional assistance would have to come with major Democratic concessions, including more restrictive immigration laws.” The bottom line: Ongoing uncertainty. Deficit Rises to $1.7 Trillion in 2023: CBO The federal budget deficit totaled $1.7 trillion in fiscal year 2023, about $300 billion (23%) larger than the year before, according to a [preliminary analysis]( released by the Congressional Budget Review on Tuesday. The federal government received $4.4 trillion in revenues during the October 2022 to September 2023 period — $455 billion (9%) less than the year before. Outlays for the full fiscal year were $6.1 trillion, or $141 billion (2%) less than a year earlier. As the CBO noted last month, the cancelation of the Biden administration’s plan to forgive billions of dollars in student loan debt distorted the data in both 2023 and 2022. If the recorded costs and savings for that plan — which never took effect — are excluded, the deficit in 2022 would shrink to about $900 billion, while the deficit in 2023 would increase to about $2 trillion. “Thus, without the effects of debt cancellation (and excluding the effects of timing shifts), the deficit would have grown by nearly $1.1 trillion from 2022 to 2023,” CBO said. The fiscal hawks at the Committee for a Responsible Federal Budget said the latest CBO numbers highlight the need to bring the federal debt and deficit under control. “After declining in recent years due to the pandemic ending, the deficit is now back on the rise, totaling $1.7 trillion in 2023 and more than double last year’s when you exclude the President’s now-overturned student debt cancellation and timing shifts,” CRFB President Maya MacGuineas said in a statement. “With deficits doubling, interest rates surging, major trust funds on course to be exhausted in a decade, and new security threats emerging – everything is telling us it’s time to address the debt.” The U.S. Treasury will provide the final, official numbers for the 2023 budget later this week. Quotes of the Day “This was like the first session of marriage counseling. Everybody aired their grievances.” — Rep. Nick LaLota of New York describing a meeting Monday night of Republican representatives to discuss the election of the next speaker of the House. Reps. Steve Scalise of Louisiana and Jim Jordan of Ohio are the leading candidates at this point, but neither has enough supporters to win a vote. “This is a hard conference to lead. There’s a lot of free agents in there.” — Rep. Steve Womack of Arkansas, who is backing Scalise for the speakership. “It’s a scattergram,” Womack said Monday. “We are all over the map on the way forward.” “A short window is all we need in the House to reinstate Kevin McCarthy ...” — Rep. John Duarte of California, a moderate Republican who has proposed that former House Speaker Kevin McCarthy be reinstated in office, less than a week after he was voted out. “Lawmakers are concerned that another drawn out speakership battle will delay action to aid Israel after attacks that sent America’s closest Middle East ally into a state of war,” [says]( Politico. “That’s time, these Republicans say, that they don’t have during a major emergency.” The effort has relatively weak support so far, and McCarthy reportedly told Republican leaders not to nominate him for the speakership in a planned conference-wide meeting on Wednesday. --------------------------------------------------------------- Send your feedback to yrosenberg@thefiscaltimes.com. --------------------------------------------------------------- Fiscal News Roundup - [Biden Decries “Evil” Hamas Attack, Says Americans Being Held Hostage]( – Washington Post - [House Disarray Leaves Path for Israel Aid Uncertain]( – New York Times - [Acting Speaker Suggests Congress Might Aid Israel Before House Gets New Leader]( – Politico - [After One Week Without a House Speaker, Republicans Appear No Closer to Choosing a New Leader]( – Associated Press - [Speaker Vacancy, GOP Dysfunction in Spotlight Amid Violence in Israel]( – The Hill - [McCarthy Loyalists Vow to Draw out Painful Speakership Battle]( – Politico - [Higher Bond Yields Likely to Extend Fed Rate Pause]( – Wall Street Journal - [IMF Outlook Worsens for a ‘Limping’ World Economy. Mideast War Poses New Uncertainty]( – Associated Press - [Biden’s Second Try at Student Loan Cancellation Moves Forward With Debate Over the Plan’s Details]( – Associated Press - [Nonprofit Hospitals Not Providing Enough Charity Required for Tax-Exempt Status, Sanders Says]( – The Hill - [Schools’ Pandemic Spending Boosted Tech Companies. Did It Help US Students?]( – Associated Press Views and Analysis - [Four Steps for the U.S. to Help Israel]( – Sen. Mitch McConnell (R-KY), Wall Street Journal - [The Wars in Israel and Ukraine Are Linked, Along With the Aid]( – Josh Rogin, Washington Post - [The Speaker’s Race and the Israeli War]( – David Dayen, American Prospect - [Wake Up, Washington]( – Wall Street Journal Editorial Board - [The Republican Meltdown Shows No Sign of Cooling Off]( – Gail Collins and Bret Stephens, New York Times - [Jim Jordan’s New Shutdown Threat Highlights an Unnerving Right-Wing Trend]( – Greg Sargent, Washington Post - [The Jim Jordan-ization of the GOP]( – Aaron Blake, Washington Post - [What We Can Do to Make American Politics Less Dysfunctional]( – Yuval Levin, New York Times - [Why We Should, but Won’t, Reduce the Budget Deficit]( – Paul Krugman, New York Times - [Why the Full Employment Created by Bidenomics Should Be Celebrated]( – Ryan Cooper, American Prospect - [An Expansive Decision in Moore Case Could Spell Trouble for Our Tax Code]( – Steven M. Rosenthal, Tax Policy Center Copyright © 2023 The Fiscal Times, All rights reserved. You are receiving this newsletter because you subscribed at our website or through Facebook. The Fiscal Times, 399 Park Avenue, 14th Floor, New York, NY 10022, United States Want to change how you receive these emails? [Update your preferences]( or [unsubscribe](