Amendment bars offshore firms from defense contracts

Outrage over corporate misbehavior overwhelmed even a Senate discussion of war financing Wednesday, as senators approved an amendment to the 2003 Defense appropriations bill to bar U.S. companies that move to offshore tax havens from participating in defense contracts.

Sen. Phil Gramm, R-Texas, argued the provision would violate the General Agreement on Tariffs and Trade. Senate Minority Whip Don Nickles, R-Okla., argued the issue was a matter for the Finance Committee and did not belong in the Defense spending measure.

But the amendment, proposed by Sen. Paul Wellstone, D-Minn., was approved by a voice vote.

"We are only saying to federal contractors: Pay your fair share of taxes, as does everybody else, and for now on--December 31, 2001, and forward--any of you companies, if you want to go to Bermuda and play this shell game and renounce your citizenship, then you are not going to get our defense contracts," said Wellstone on the Senate floor.

The Senate appeared on track Wednesday evening to give its approval today to the $355.4 billion Defense bill recommended last Thursday by the Appropriations Committee.

The amount is less than the president's request and almost matches the House-passed $354.7 billion level.

Also, Sen. John McCain, R-Ariz., offered three amendments on an aircraft leasing deal the Air Force has struck with the Boeing Corporation.

Senators adopted a proposal offered by Sen. Richard Lugar, R-Ind., to waive a precondition for releasing funds from the so-called Nunn-Lugar program to clean up chemical, biological and nuclear weapons sites in the former Soviet Union.

The administration supported Lugar's request, which would allow funds to be spent to clean up 1.9 million canisters of nerve gas stored near Moscow. The project will take at least six years.