Trump reconsiders $1.8 billion ally compensation fund amid Republican backlash

President Donald Trump is reconsidering whether to move forward with a $1.8 billion fund intended to compensate his allies, a person familiar with his thinking said on Monday, as the Justice Department said it would temporarily pause its implementation to comply with a court order.

The potential retreat is a nod to the legal setbacks the fund has encountered since it was announced two weeks ago and a recognition of the mounting political backlash from Republicans concerned by a lack of oversight of the money's disbursement and the potential for payouts to participants in the January 6, 2021, riot at the US Capitol.

The Trump administration had defended the $1.776 billion “Anti-Weaponisation Fund”, established to resolve Trump’s lawsuit against the Internal Revenue Service over the leak of his tax returns, as an appropriate corrective measure for what officials insist was weaponised law enforcement during the Biden administration.

But while some Trump supporters – including participants in the Capitol riot – celebrated the announcement of the fund, the reaction among Republicans in Congress has been decidedly more hostile.

The outrage came to a head last month at a closed-door meeting between senators and acting Attorney General Todd Blanche that Republican Senator Ted Cruz of Texas described on a recent episode of his podcast as “one of the roughest meetings I’ve seen in my entire time in the Senate”.

Read moreTrump drops $10 billion IRS lawsuit in exchange for $1.7 billion fund for allies

The furore has especially complicated matters in the Senate, where Republicans defiantly left town 10 days ago without passing legislation to fund Trump’s immigration enforcement agencies. Republicans who returned to Washington on Monday said they will not have the votes to pass the Homeland Security spending bill until the White House works with them to place parameters on the fund. Many have pushed the administration to impose limits or scrap the idea altogether.

Amid the backlash, a person familiar with the matter, who insisted on anonymity to discuss the president’s thinking, said on Monday that Trump was reconsidering whether to move forward with the fund.

But it was not clear whether the Justice Department’s statement that it would pause action on the fund was definitive enough for the Senate to be able to move the bill forward.

“They need to say what they actually mean,” said Republican Senator Jim Lankford. “They need to say, ‘We’re setting this whole thing aside.’”

Senate Majority Leader John Thune indicated on Monday that he hoped the White House would move to drop the fund.

“I do think the best way to handle it is if the administration decides to shut it down themselves,” Thune told reporters.

He said any additional statements from the administration would be helpful, but added: “I think the statement they made effectively shuts it down. We’ll find out.”

The Justice Department said it would comply with a ruling in Virginia on Friday by US District Judge Leonie Brinkema, who responded to an outside challenge to the fund by temporarily halting its implementation. The judge scheduled a June 12 hearing for arguments on whether to extend her order.

The department said in a statement that it strongly disagrees with the ruling but will comply with it.

“This Fund was open to anybody who was so weaponised, targeted, or persecuted, whether they were Democrat, Republican, Conservative, Independent, or otherwise,” the statement said. “The Department will abide by the Court’s ruling.”

Separately, the federal judge in Florida overseeing Trump’s lawsuit against the IRS ordered Trump’s attorneys on Friday to respond to “grievous allegations” by settlement critics that the president abandoned his claims to avoid the court’s scrutiny of an illegal deal. US District Judge Kathleen Williams gave them until June 12 to respond in writing to allegations of collusion and whether the case should be reopened because the court was the “victim of a fraud”.

As part of the settlement, the IRS agreed to drop all past and pending probes of Trump, his family and other associates over whether they had paid their fair share of taxes.

It was not immediately clear whether the retreat being signalled on the fund on Monday also indicated that the administration was backtracking on its promised immunity from tax audits.

(FRANCE 24 with AP)