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More than $60 billion in renewed security aid for Ukraine’s war effort has been disclosed in a US Senate draft of a supplemental funding bill. Though the bill has relatively strong bipartisan support in that chamber, Republicans in the House of Representatives may stand in the way of the sum. This proposed funding comes on the heels of a $50 billion multi-year commitment to Kyiv on behalf of the European Union. Legislative discord in America is kicking up just as a political dispute between Ukrainian President Volodymyr Zelenskyy and Commander-in-Chief Valerii Zaluzhnyi threatens to boil over. 

As Zelenskyy’s popularity has begun to fade among Ukrainians throughout the past year, Zaluzhnyi has remained a trusted figure among nine in ten Ukrainians, but the latter is likely to be sacked by the President in coming days. That move is part of a broader re-shuffling of Zelenskyy’s government and the removal of elements that are not “convinced of victory” over Russia’s ongoing invasion. Almost 20% of Ukrainains now see land concessions as an acceptable condition to end the war, but this is not on the table according to Kyiv’s current objectives. Zelenskyy is facing the end of his term of office in March, but is likely to remain in place with no elections scheduled prior to that date.

Related ETF: SPDR S&P Aerospace & Defense ETF (XAR)

The United States Senate has released the details of a $118.2 billion security aid proposal with funds allocated for Ukraine, Israel and the US’s southern border. More than half of the provisions are carved out for Ukraine, with $60.1 billion of security and financial aid earmarked for Kyiv. Though this version of the bill carries bipartisan support in the Senate and largely follows the President’s initial request for the supplemental spending last year, which will be piled on top of a record-breaking $886 billion military budget included in the 2024 NDAA, it appears unlikely to gain necessary support in the House of Representatives in its current form.

Republicans in the House largely support funds for the border, as well as increased support for Israel, but they’ve sought to enact these initiatives separately from Ukraine funding. MRP noted in 2023 that a bundling of Ukraine and Israel aid would increase the chances that Ukraine receives a larger package of US support, but Representatives and the Speaker of the House remain reluctant to allow this. Just last week, Speaker Mike Johnson (R-LA) said that the Senate draft of the aid bill would be “dead on arrival” in the House. That will likely depend on just how well the legislation does when the Senate votes on it, as strong support among Republicans in the upper chamber may swing the balance against Johnson. The bill is almost certain to be passed by the Senate vote, but The Hill reports Minority Leader Mitch McConnell (R-KY) is aiming to get as many as half of the 49 Senate Republicans on board for this massive commitment. If anywhere near that many GOP Senators vote in favor of the supplemental funding, that will bode well for its chances once it is sent down to the narrow Republican majority in the House.

Some amount of further security assistance for Ukraine is likely to pass eventually, but it may not be $60 billion and it may also take a significant amount of time to be negotiated. Per the Congressional Research Service, the…

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