President Donald Trump’s nearly $1.8 billion fund to compensate people who claim they were victims of government “weaponization” has been put on hold after fierce opposition from Republicans in Congress, three sources familiar with the plan said Monday.
Republicans Push Back On Trump Fund
The rare rebuke showed some Senate Republicans’ growing willingness to challenge Trump, particularly after his endorsement of Texas Attorney General Ken Paxton over Sen. John Cornyn (R-Texas) ahead of a crucial midterm election.
Senators returned from their Memorial Day break and dropped the proposal as they remained deadlocked with Trump over a $72 billion bill to fund ICE and Border Patrol operations.
“They gave us an ultimatum,” a White House source told Reuters, describing negotiations with Republican lawmakers. The source said the White House wanted to speed passage of the immigration funding package. The sources spoke on condition of anonymity to discuss internal deliberations.
Settlement Sparks Slush Fund Backlash
Reuters described the Republican revolt as extraordinary because Trump demands loyalty and has threatened to back primary challengers against Republicans who break with him.
The fund grew out of a legal settlement between Trump and the Justice Department resolving a $10 billion lawsuit against the IRS over the alleged mishandling of his tax records. The $1.776 billion fund was designed to compensate people who said they were targets of government abuse.
The plan triggered legal challenges and political anger, including from Senate Republicans concerned that people who attacked the U.S. Capitol on Jan. 6, 2021, could receive taxpayer-funded payouts. Critics called it a slush fund.
The settlement also barred the IRS from pursuing audits of past tax claims involving Trump, his relatives and his companies for returns filed before May 18. It was unclear whether pausing the fund would affect possible audits.
Democrats Move To Block Payouts
Democrats want guarantees that it will not return in another form. Senate Minority Leader Chuck Schumer (D-N.Y.) wrote on X, “This week, Senate Democrats will push legislation to ban this slush fund and ensure no president can ever do this again.”
After Schumer’s promise, three Democratic senators moved on Monday to eliminate the fund. Sens. Adam Schiff (D-Calif), Mark Kelly (D-Ariz.) and Elissa Slotkin (D-Mich.) introduced the “Drain the Slush Fund Act,” which they said would block taxpayer money from going to Trump, his associates, people convicted of crimes or people involved in the Jan. 6, 2021, attack on the Capitol.
A source close to Trump told Reuters that the president is “not thrilled,” but accepts the pause as the only path forward “for now.” The source added that Trump has not made a final decision and that nothing is final until he announces it.
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