Trump Diverting $3.6 Billion from Military to Build Border Wall
The Department of Defense has approved a plan to divert $3.6 billion to pay for the construction of parts of President Trump’s border wall, Defense Secretary Mark Esper said Tuesday. The money will be shifted from more than 100 construction projects focused on upgrading military bases in the U.S. and overseas, which will be suspended until Congress provides additional funds.
In a letter addressed to Senator James Inhofe, chair of the Armed Services Committee, Esper said that in response to the national emergency declared by Trump earlier this year, he was approving work on 11 military construction projects “to support the use of armed forces” on the border with Mexico.
The $3.6 billion will fund about 175 miles of new and refurbished barriers (Esper’s letter does not use the term “wall”).
Esper described the projects, which include new and replacement barriers in San Diego, El Paso and Laredo, Texas, as “force multipliers” that, once completed, will allow the Pentagon to redeploy troops to high-traffic sections of the border that lack barriers. About 5,000 active duty and National Guard troops are currently deployed on the border.
Months in the making: Trump’s declaration of a national emergency on the southern border on February 15, 2019, came in the wake of a showdown with Congress over funding for the border wall. The president’s demand for $5.7 billion for the wall sparked a 35-day government shutdown, which ended when Trump reluctantly agreed to a deal that provided $1.375 billion for border security. By declaring a national emergency, Trump gave the Pentagon the legal authority to move billions of dollars around in its budget to address the purported crisis. Legal challenges to the emergency declaration are ongoing.
Conflict with lawmakers: Congress passed a resolution opposing the national emergency declaration in March, prompting Trump to issue the first veto of his presidency. Democrats on the House Appropriations Committee reiterated their opposition to Trump’s move Tuesday, saying in a letter, “As we have previously written, the decision to take funds from critical military construction projects is unjustified and will have lasting impacts on our military.”
Majority Leader Steny H. Hoyer was more forceful, saying in a statement, "It is abhorrent that the Trump Administration is choosing to defund 127 critical military construction projects all over the country … and on U.S. bases overseas to pay for an ineffective and expensive wall the Congress has refused to fund. This is a subversion of the will of the American people and their representatives. It is an attack on our military and its effectiveness to keep Americans safe. Moreover, it is a political ploy aimed at satisfying President Trump's base, to whom he falsely promised that Mexico would pay for the construction of an unnecessary wall, which taxpayers and our military are now being forced to fund at a cost of $3.6 billion.”
A group of 10 Democratic Senators said in a letter to Esper that they “are opposed to this decision and the damage it will cause to our military and the relationship between Congress and the Department of Defense.” They said they also “expect a full justification of how the decision to cancel was made for each project selected and why a border wall is more important to our national security and the well-being of our service members and their families than these projects.”
Politico’s John Bresnahan, Connor O'Brien and Marianne LeVine said the diversion will likely be unpopular with Republican lawmakers as well. Republican Senators Mike Lee and Mitt Romney expressed concerns Wednesday about funds being diverted from their home state of Utah. "Funding the border wall is an important priority, and the Executive Branch should use the appropriate channels in Congress, rather than divert already appropriated funding away from military construction projects and therefore undermining military readiness," Romney said.
The Pentagon released a list of construction projects that will be affected late on Wednesday (you can review a screenshot tweeted by NBC News’ Alex Moe here).
An $8 billion effort: In addition to the military construction funds and the money provided by Congress, the Trump administration is using $2.5 billion in drug interdiction money and $600 million in Treasury forfeiture funds to support the construction of barriers on the southern border, for a total of approximately $8 billion. (More on that here.)
The administration reportedly has characterized the suspended military construction projects as being delayed, but to be revived, those projects would require Congress approving new funding. House Democrats have vowed they won’t “backfill” the money.
The politics of the wall: Trump has reportedly been intensely focused on making progress on the border wall, amid news that virtually no new wall has been built during the first two and a half years of his presidency. Speaking to reporters at the White House Wednesday, Trump said that construction on the wall is moving ahead “rapidly” and that hundreds of miles will be “almost complete if not complete by the end of next year … just after the election.”
A Surprise Government Spending Slowdown
Economists expected federal spending to boost growth in 2019, but some of the fiscal stimulus provided by the 2018 budget deal has failed to show up this year, according to Kate Davidson of The Wall Street Journal.
Defense spending has come in as expected, but nondefense spending has lagged, and it’s unlikely to catch up to projections even if it accelerates in the coming months. Lower spending on disaster relief, the government shutdown earlier this year, and federal agencies spending less than they have been given by Congress all appear to be playing a role in the spending slowdown, Davidson said.
Number of the Day: $203,500
The Wall Street Journal’s Catherine Lucey reports that acting White House Chief of Staff Mick Mulvaney is making a bit more than his predecessors: “The latest annual report to Congress on White House personnel shows that President Trump’s third chief of staff is getting an annual salary of $203,500, compared with Reince Priebus and John Kelly, each of whom earned $179,700.” The difference is the result of Mulvaney still technically occupying the role of director of the White House Office of Management and Budget, where his salary level is set by law.
The White House told the Journal that if Mulvaney is made permanent chief of staff his salary would be adjusted to the current salary for an assistant to the president, $183,000.
The Census Affects Nearly $1 Trillion in Spending
The 2020 census faces possible delay as the Supreme Court sorts out the legality of a controversial citizenship question added by the Trump administration. Tracy Gordon of the Tax Policy Center notes that in addition to the basic issue of political representation, the decennial population count affects roughly $900 billion in federal spending, ranging from Medicaid assistance funds to Section 8 housing vouchers. Here’s a look at the top 10 programs affected by the census:
Chart of the Day: Offshore Profits Continue to Rise
Brad Setser, a former U.S. Treasury economist now with the Council on Foreign Relations, added another detail to his assessment of the foreign provisions of the Tax Cuts and Jobs Act: “A bit more evidence that Trump's tax reform didn't change incentives to offshore profits: the enormous profits that U.S. firms report in low tax jurisdictions continues to rise,” Setser wrote. “In fact, there was a bit of a jump up over the course of 2018.”
Deficit Hits $738.6 Billion in First 8 Months of Fiscal Year
The U.S. budget deficit grew to $738.6 billion in the first eight months of the current fiscal year – an increase of $206 billion, or 38.8%, over the deficit recorded during the same period a year earlier. Bloomberg’s Sarah McGregor notes that the big increase occurred despite a jump in tariff revenues, which have nearly doubled to $44.9 billion so far this fiscal year. But that increase, which contributed to an overall increase in revenues of 2.3%, was not enough to make up for the reduced revenues from the Republican tax cuts and a 9.3% increase in government spending.