Administration's Plan to Send $450-Million to Egypt Hits Roadblock in Congress

By Patrick Goodenough | October 2, 2012 | 4:56 AM EDT

Protesters destroy an American flag at the U.S. Embassy in Cairo on Tuesday, Sept. 11, 2012. (AP Photo/Mohammed Abu Zaid)

( – Two weeks after Egyptian authorities largely stood by while protestors stormed the U.S. Embassy in Cairo, the State Department said Monday that some lawmakers have displayed “some interest” in the administration’s plan to transfer $450 million in economic support funds to the country’s Muslim Brotherhood-led government.

Challenged during a press briefing on her use of the word “interest,” State Department spokeswoman Victoria Nuland conceded that “concern” had been raised on Capitol Hill and that the administration would be reaching out to discuss the matter.

In fact, some Republican lawmakers are strongly opposed to the move, and Rep. Kay Granger (R-Texas), chairman of the House Appropriations subcommittee responsible for state and foreign operations, has placed a hold on the aid transfer.

“This proposal comes to Congress at a point when the U.S.-Egypt relationship has never been under more scrutiny, and rightly so,” Granger said in a brief statement late Friday.

“I am not convinced of the urgent need for this assistance, and I cannot support it at this time.  As chair of the subcommittee, I have placed a hold on these funds.”

House Foreign Affairs Committee chairman Rep. Ileana Ros-Lehtinen (R-Fla.) on Monday added her voice to the opposition.

“The Egyptian government has not gained the trust of the U.S., and the administration’s response is to cut an unprecedented $450 million check directly to the Muslim Brotherhood-led government,” she said.

“I reject the administration’s attempt to double down on its failed Egypt policy at the expense of American taxpayers.”

Nuland on Monday defended the plan, part of a pledge by President Obama to provide $1 billion in debt relief to help post-Mubarak Egypt in its transition to democracy.

“As the president made clear more than a year ago when he pledged a billion dollars in support from the American people to the people of Egypt if their transition stays on track and continues, and as the secretary said when we were in Cairo in July, on Friday we here at the State Department notified the Congress of our intention to disburse $450 million in budget support to the government of Egypt in two tranches,” she said.

“Thereafter, we had some interest in that from the Congress, so we are obviously going to have to work with the Congress in the coming days and weeks to explain why we think this money is so essential at a time of almost $12 billion in budget gap in Egypt, why we think supporting the democratic trajectory of Egypt in a phased way is in U.S. interests, because we obviously firmly do.”

Congress is in recess, but Nuland envisaged “staff to staff briefings” in a bid to allay the concerns.

Even before the September 11 Cairo incident – when protestors breached the embassy compound walls, destroyed an American flag and hoisted a black banner associated with radical Islam – Ros-Lehtinen and other senior lawmakers had placed holds on aid to Egypt over other concerns.

A late-2011 congressional requirement linking $1.3 billion in military aid to democratic norms ran up against an Egyptian crackdown on U.S.-funded democracy-promoting non-governmental organizations (NGOs).

Last March, however, Secretary of State Hillary Clinton waived restrictions on the aid, citing national security interests and expressing optimism in Egypt’s “significant progress toward democracy.”

That decision was criticized by Sen. Patrick Leahy (D-Vt.), who had authored the legislation imposing conditions on the aid.

Although the NGO clampdown took place before the election of President Mohamed Morsi, his Muslim Brotherhood reportedly supported it.

Friday’s notification to Congress came on the same day Clinton addressed a meeting of a G8 partnership aimed at helping Arab nations in transition, and stressed the importance of ongoing financial support.

“Extremists are clearly determined to hijack these wars and revolutions to further their agendas and ideology, so our partnership must empower those who would see their nations emerge as true democracies,” she told the gathering in New York City.

“In Tunisia, Egypt, and Libya, people rose up against their dictators because they were fed up with governments that served the interests of a few at the expense of everyone else,” she said. “But economic and social challenges did not disappear with the dictators. Too many people still can’t find jobs, and young and growing populations crave a sense of opportunity and self-determination.”

“Everything we do together in this partnership to promote economic stability and equal opportunity advances freedom and dignity,” Clinton said. “We are standing up for democracies that are unlocking people’s potential and standing against extremists who exploit people’s frustrations.”

Patrick Goodenough
Patrick Goodenough
Spencer Journalism Fellow