Iran Stuck in the Middle of Partisan Debt Relief Politics

On April 16, the U.S. House of Representatives voted on H.R. 2634, legislation "to provide for greater responsibility in lending and expanded cancellation of debts owed to the United States and the international financial institutions by low-income countries."

During the debate on H.R. 2634, there was a procedural motion to recommit the bill offered by Rep. Mario Diaz-Balart (R-FL) that would allow it to include Amendment 994 which states: “Countries that have a business relationship with Iran are not eligible to be considered under this debt relief program.” However, the Republican motion backfired because the wording in the instructions to motion to recommit also cleared existing conditions that would apply to debt relief, along with previously adopted amendments.

According to Financial Services Committee Chairman Barney Frank (D-MA), whose committee has jurisdiction over the bill, the only way to fix the problem would be through a vote on new bill. In an article on April 17 for CQ Today by Adam Graham-Silverman, Rep. Frank said, “I’m going to invoke the old motto: to the victor goes what he spoiled. This is what happens when you do these things in a hurry because you want to ambush and not do legislating.”

Rep. Frank also called the motion to recommit, which passed 291-130, “mischief.” Proving once again the short-sightedness of U.S. policy towards Iran, Rep. Frank said the motion passed because “people get afraid in an election year of being accused of having helped Iran.”

In addition, there was little debate over which countries the amendment might affect, except for a minute amount spent on Iraq. Rep. Frank noted, “…the Government of Iraq [has] business interests with Iran. I know there are close ties between the Governments of Iraq and Iran. There’s interchangeability.” Rep. Diaz-Barlart reassured Rep. Frank: “It does not affect Iraq.”

Amendments erased by the motion were a tough pill to swallow for Republicans and included one introduced by Rep. Frank on behalf of Republicans to require that countries commit to free elections and fight human trafficking and illegal immigration in the United States (passed 424-0) . Another amendment erased was introduced by Rep. Dana Rohrabacher (R-CA) would have excluded governments from debt relief not chosen by free elections (passed 382-41). Also, the motion to recommit erased Bush administration supported language that would have required savings from debt relief be applied to poverty reduction and a ban on conditions that could have limited countries’ ability to boost spending on health care or education.

Although the Office of Management and Budget opposed the passage of the bill, it did not include a veto threat in a statement of Bush Administration policy on the legislation. House Financial Services ranking member Spencer Bachus (R-AL) said “I would be stunned if [President Bush] did anything but sign it.” The Senate Foreign Relations Committee is planning a hearing on the companion bill, S. 2166 on April 24.