Obama’s IMF pledge meets congressional resistance

WASHINGTON —  President Obama’s initiative to shore up the developing world through a global fund, the cornerstone of an international economic recovery effort begun last month, is meeting with resistance in Congress.

The bipartisan push-back also threatens the president’s other foreign policy priorities, including funding for the wars in Afghanistan and Iraq. All are part of legislation caught between House and Senate differences.

World leaders meeting in April as part of the Group of 20 summit in London agreed to offer $1.1 trillion in loans and guarantees to developing nations through the International Monetary Fund. As part of that, Obama promised to secure more than $100 billion in U.S.-backed loans, despite critics who said it amounted to ineffective meddling in other countries.

For Obama, the G-20 represented a key part of his drive to remake the U.S. image abroad, and the congressional challenge marks an important first test of his foreign policy efforts.

Obama is seeking the IMF infusion as part of a measure to provide $90 billion for the wars in Afghanistan and Iraq. The Senate included IMF funding in its bill; the House did not.

The differences between the two bills must be resolved after Congress returns from its weeklong Memorial Day recess.

When the House passed its version of the war funding bill last week, Obama depended heavily on support from Republicans. GOP support made up for the 51 Democrats who voted against the bill because they opposed the war in Iraq and Obama’s plan to step up the U.S. commitment in Afghanistan.

However, House Minority Leader John A. Boehner (R-Ohio) warned that the additional funding for the IMF threatened to erode support from Republicans, including those who believe the money should not be included in the war funding bill and those skeptical of Obama’s game plan in Afghanistan.

A key question for House and Senate negotiators will be whether to include the IMF money.

When the Senate was debating its version of the bill, it voted 64 to 30 against an amendment by Sen. Jim DeMint (R-S.C.) to strip out the money for the IMF.

Critics of DeMint’s amendment said it would undercut efforts to stabilize the world economy. But others said that the money amounted to a U.S. bailout of foreigners at a time when American workers are suffering.

“This is the worst time to ask struggling American families to bail out foreign countries,” DeMint said.

Peter R. Orszag, Obama’s budget director, told a House subcommittee last week that IMF funding was “one of the key priorities that the president has put forward because the IMF plays a crucial role in staving off a global financial and economic downturn.”

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janet.hook@latimes.com