Updated 6:54 p.m.
Senate Democrats accused Republicans Thursday of holding up aid to the new Ukrainian government and sanctions against certain Russian officials in hopes of getting the Obama administration to end plans for a proposed regulation that would dramatically change how nonprofit groups engage in political activity.
Majority Leader Harry M. Reid (D-Nev.) said Thursday that Senate Republican leaders had demanded that the Internal Revenue Service delay new regulations against nonprofit political advocacy groups in exchange for including long-sought reforms at the International Monetary Fund in legislation providing aid to Ukraine. In doing so, Reid said, Republicans were more interested in helping their campaign donors, including the billionaire industrialists Charles and David Koch, who are bankrolling conservative political groups helping GOP congressional candidates.
“This is hard for me to comprehend, how with a clear conscience they can say — Ukrainians, we probably can’t help you because we’re trying to protect the Koch brothers,” Reid told reporters. “And not only that, they’re saying the American people that protecting the Koch brothers is more important than protecting our country.”
Reid has devoted considerable time in recent weeks to directly attacking the Koch brothers, who have spent millions of dollars through their super PAC on television ads attacking Democratic incumbents. In a separate speech Thursday, Reid said the brothers "may spend hundreds of millions of dollars rigging the political process for their own benefit. And they may believe that whoever has the most money gets the most free speech."
Rob Tappan, a spokesman for the Koch brothers, said in a statement Thursday that "This is the seventh time that Senator Reid has attacked Charles Koch and David Koch on the floor of the Senate. Like most Americans, we believe his conduct is beneath his office, and his statements about us are false. For the sitting Majority Leader to go out on the floor of the Senate and single-out two individuals and try to demonize them because they’re exercising their First Amendment rights … we find that very, very troubling. Senator Reid sounds desperate to keep his job."
The dispute means that Congress is unlikely to approve a new U.S. aid package to the Ukrainian government and sanctions against Russian authorities before leaving Friday for another week-long recess. The inaction comes as eight U.S. senators plan to travel Thursday night to Ukraine to meet with the country's political leaders and as Russian troops began massing on the Ukrainian border Friday just days before a referendum is set in Crimea over whether the region should split from Ukraine and join the Russian Federation. World financial markets also teetered Thursday as the standoff intensified. The Dow Jones industrial average was down more than 200 points in late afternoon trading Thursday.
At issue in the standoff is whether Congress should approve changes long-sought by the White House that would shift about $63 billion in IMF money from a crisis fund to a general account. Doing so would make good on a 2010 pledge and ensure greater U.S. influence over the world body.
The changes were approved Thursday as part of an aid package approved by the Senate Foreign Relations Committee that was backed by Democrats and Republicans. But before the vote, the panel rejected an amendment from GOP senators that would have stripped out the language pertaining to the IMF.
A senior Republican aide disputed Reid’s account but did not deny that GOP leaders had raised the possibility of delaying the IRS’s implementation of the new regulation targeting nonprofit political groups.
“This is entirely about IMF, not Ukraine,” said the aide, who wasn’t authorized to speak publicly on the matter. “If the Democrats want to remove the IMF provisions, the bill could be done.”
House Republicans also strongly oppose attaching the IMF language to the Ukrainian aid deal. House Speaker John A. Boehner (R-Ohio) called on the Senate Thursday to quickly approve a House-passed aid package instead of the competing proposal.
"The IMF money has nothing to do with Ukraine," Boehner told reporters. "I understand the administration wants the IMF money, but it has nothing at all to do with Ukraine. So let's just understand what the facts are here."
Even if lawmakers fail to approve the aid and sanctions deal by the end of this week, leaders in both chambers expect it to be quickly approved once the House and Senate return to Washington on March 24.