Senate Panel Votes to Block Money for Iraq Reconstruction

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A Senate panel has agreed unanimously to block the Defense Department from funding Iraq reconstruction projects worth more than $2 million and to begin to force Baghdad to cover the costs of training and equipping its security forces.

The provision, included in a 2009 defense policy bill approved this week by the Senate Armed Services Committee, comes as Democrats draft a similar provision within separate legislation that would cover this year's war spending.

The efforts are part of the latest push on Capitol Hill to get Iraq to spend more of its own money and spare U.S. taxpayers. Democrats and many Republicans say it is unfair that Iraq is looking at pulling in as much as $70 billion in oil revenues this year while Americans grapple with soaring fuel prices at the pump.

"We want to send a very powerful message to the Iraqis and to the administration as to the cost of this war and the absurdity that a country which is exporting 2 million barrels a day of oil, for which we are paying when it gets to the pump now $3.50 a gallon" is not fully paying to rebuild itself, said Sen. Carl Levin, D-Mich., chairman of the Armed Services Committee.

The White House said Thursday that for American troops to be withdrawn eventually from Iraq, money must be spent to help rebuild the country and train Iraqi troops.

"I think it's important that the Iraqis actually are spending a lot more on their reconstruction than maybe is commonly understood out there," said White House deputy press secretary Tony Fratto. "In their most recent budget, they'll outspend the United States 10 to 1 on reconstruction. ... We are pretty much out of the business of very large reconstruction projects in Iraq."

Fratto did not say whether the administration would threaten to veto the legislation. Lawmakers involved in drafting the bill said it was unlikely, particularly because of the bipartisan support it attracted.

"They didn't reject it," said Sen. Ben Nelson of closed-door negotiations this week with the National Security Council. Nelson, D-Neb., sponsored the provision along with Sens. Susan Collins, R-Maine, and Evan Bayh, D-Ind.

The defense policy bill, which will be considered by the full Senate later this month, would only affect Defense Department spending in 2009, which is estimated at $612.5 billion. It is unclear how much of that money could potentially be used for reconstruction and therefore might be affected by the proposed restriction.

Levin said an attempt will be made on the Senate floor to expand to the State Department the prohibition on using taxpayer money for major Iraqi reconstruction. The State Department handles most of the large rebuilding efforts.

"The intention here is to stop the funding of infrastructure by whatever department," he said.

The defense authorization legislation specifically supports smaller rebuilding projects, but would require the administration to work with Baghdad to obligate its own money first. It also says the U.S. must initiate negotiations with Iraq on a broader agreement to share the costs of combat operations in Iraq.

Instead of flatly prohibiting aid to the Iraqi security forces, the bill says the U.S. "shall take actions to ensure that Iraqi funds are used" to cover those costs, including the salaries of the forces and any payments to Sunnis who are part of the Awakening Movement.

Overall, the defense policy bill would authorize $542.5 billion in annual defense spending, as well as $70 billion for the wars in Iraq and Afghanistan.

Besides the reconstruction provision, the authorization bill would ban all private security contractors from working in "highly hazardous public areas where the risks are uncertain and could reasonably be expected to require deadly force," according to a committee summary.

Levin said the Defense Department already imposes such a rule on its contractors, but the State Department "was the problem." He said he did not know how many contractors the new law would affect if enacted, but said he thought the number would be fairly small.

Rep. John Murtha, D-Pa., chairman of the House Defense Appropriations subcommittee, said Thursday that this year's war spending bill will likely include a provision restricting U.S. money on Iraq reconstruction as well. He said he is recommending that the bill include $170 billion for combat operations — money that would cover the war until the next administration takes over in January. His proposal also would ban permanent bases in Iraq, set limits on aggressive interrogations and require that service members sent to Iraq be fully trained and equipped, he said.

Congressional officials said the administration this week pushed the Senate Armed Services Committee to let the president waive any restrictions on reconstruction funds if he determined it was necessary to protect national security. Despite support for the idea by the committee's No. 2 Republican, Sen. John Warner of Virginia, Collins and the panel's Democrats said allowing such waivers would have made the legislation too soft.

Warner told reporters Thursday that he supports the authorization bill as it is written, which sends a "loud message" that "the American people expect no less than an increased sharing of the responsibilities and the financial burdens."