Senate to focus on military part of Iraq supplemental

Senate Appropriations Committee Chairman Ted Stevens, R-Alaska, said Wednesday he would aim for the Senate to complete work this week on the $65.6 billion military title of the Bush administration's $87 billion fiscal 2004 supplemental request for Iraq and Afghanistan, while saving consideration of the $21.4 billion reconstruction title until after the chamber's recess next week.

"I would like to be able to tell the House how the Senate feels about the military side and await consideration of what the House does on the reconstruction side," Stevens said on the Senate floor.

The House Appropriations Committee is currently scheduled to mark up it version of the supplemental next Thursday and that bill will reach the House floor the week of Oct. 13.

Of the $87 billion, the $20.3 billion set aside for Iraq reconstruction-$1.1 billion is for Afghanistan-has raised eyebrows on both sides of the aisle. A bipartisan group of up to 14 senators, arguing that Iraq's massive oil reserves are more than enough to pay for reconstruction, has approached Stevens about reshaping at least $15 billion earmarked for infrastructure projects into a loan program.

While Senate GOP leaders and the administration oppose a loan or loan guarantee, Stevens said Tuesday there would likely be a compromise on the Senate floor on the issue of reconstruction funds, although he personally favors direct aid.

Wednesday afternoon, Sen. Kay Bailey Hutchison, R-Texas, filed an amendment to convert $10 billion of the $20.3 billion into loans and loan gaurentees for essential services and infrastructure projects. Her amendment is co-sponsored by Senate Govermental Affairs Chairwoman Susan Collins, R-Maine, and Sens. Lindsey Graham, R-S.C., Larry Craig, R-Idaho, and Saxby Chambliss, R-Ga.

Senate Minority Leader Tom Daschle, D-S.D., said on the floor Wednesday that Democrats will have a series of amendments focused on strict reporting requirements before reconstruction funds are released. These include ensuring the president steps up efforts to increase international assistance; rolling back tax cuts for the top 1 percent of income-earners to pay for the bill; and transfering control of Iraq reconstruction from the Defense to the State Department "which has expertise and experience in nation building."

Senate Appropriations ranking member Robert Byrd, D-W.Va., took the floor today to chastise the administration for getting involved in the war and then not doing enough to secure international assistance for reconstruction. He noted the upcoming Madrid donors' conference Oct. 23-24.

"Could we be overbilling the American people even before the conference begins?" Byrd asked. Byrd offered an amendment to strike the Iraq reconstruction funds from the bill and consider them separately.

House Republican leaders Wednesday indicated they are open to changes and are exploring ways to balance members' concerns with the Bush administration's goal of not driving Iraq further into debt.

Following the weekly House Republican Conference meeting, Majority Whip Roy Blunt, R-Mo., said that while members are concerned that U.S. taxpayers are being asked to foot a hefty bill, they are more concerned about existing foreign loans made to the Saddam Hussein regime. Republican Conference Chairwoman Deborah Pryce of Ohio later said members fear Iraq would use the U.S. loan money to repay its $200 billion in debts to countries such as France, Saudi Arabia and Russia.

Blunt said the Republican Conference and GOP leaders want to help President Bush challenge foreign governments that lent money to the Hussein regime to not stick those bills to the new Iraqi government. "I think what the leaders would like to see-what I would like to see-is a debt-free Iraq."

But Blunt said House Appropriations Committee Chairman Bill Young, R-Fla., would include a provision in his bill prohibiting any oil revenues from going to repay debt to nations that lent Saddam money. A similar provision is in the Senate bill.

Young and Defense Appropriations Subcommittee Chairman Jerry Lewis, R-Calif., are opposed to making the reconstruction funds into a loan, as are House GOP leaders and key Democrats like Rep. Norman Dicks of Washington. A House Democratic aide noted support is building in that chamber for a loan, but added that if successful, "It'll be a 'pay us back someday' kind of thing."

Blunt said House leaders would consider making the $20.3 billion request into a loan or loan guarantee program if it were tied to forgiveness of Iraq's prior loan obligations. "That may not be the course we take in the House," Blunt said, but he added that GOP leaders would be open to discussions in conference with the Senate about some form of loan program in lieu of direct aid.

Blunt later hinted that any acceptance of loan language might be cosmetic at best, aimed more at attracting votes than a strict timetable for Iraqi debt repayment. He said leaders would be open to the idea "if it was beneficial for us to characterize" the Iraq reconstruction funds as a loan or loan guarantee.

Also Wednesday, House Republican Policy Committee Chairman Christopher Cox of California and Ahmed Chalabi, head of Iraq's Governing Council, told reporters a loan program was the wrong option. Chalabi said it would be "immoral to ask the people of Iraq to repay the money that was lent to Saddam" and was used to commit atrocities against his own people.

"The people who financed" Saddam's regime "ought not to have a return on their investments," Cox added.

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