Congress Approves Auto Loans, Defense Budget in Year-End Bill

Congress Approves Auto Loans, Defense Budget in Year-End Bill

Sept. 27 (Bloomberg) -- The U.S. Congress gave final approval to legislation providing the auto industry with $25 billion in loans, lifting an offshore oil-drilling ban and funding the government until the next president takes office.

The legislation, approved on a 78-12 vote, spends $602 billion for the departments of defense, homeland security and veterans affairs. It also funds most of the rest of the government at current levels until March 6. More than $6 billion will be spent on about 2,000 pet projects known as earmarks, according to the Washington-based Taxpayers for Common Sense.

Republicans in both chambers said they were given little opportunity to review a bill providing the bulk of the money appropriated this year by Congress.

The legislation was written ``almost exclusively by staff members and a small handful of members'' and there were ``no meetings in which to argue policy or discuss grievances that members may have had,'' said Senator Thad Cochran, the top Republican on the chamber's Appropriations Committee.

Bush is likely to sign the bill, which was approved earlier this week by the House.

The auto loan provisions were sought by General Motors Corp., Ford Motors Co., Chrysler LLC and others who said they needed taxpayer help to finance a shift to making more fuel- efficient cars.

``Congress clearly recognizes the need to move forward at this critical time to make available this source of capital for automakers and suppliers,'' said a statement from General Motors. ``These direct, federal loans will support advanced technology development and implementation and will help speed the transition to cleaner, more fuel-efficient vehicles.''

The decision to rescind the oil-drilling ban is a victory for Republicans who had been demanding for months that Congress relax rules on energy exploration off the East and West coasts.

The legislation would boost the Defense Department's budget by 6 percent to $488 billion. Homeland security funding will grow by 5 percent to $40 billion. Veterans' affairs will get a 14 percent boost to $73 billion.

Other provisions boost funding for Pell education grants by $2 billion, send $365 million to the nation of Georgia to help it recover from its conflict with Russia, provide federal employees with a 3.9 percent pay increase and extend the national flood insurance program beyond its Sept. 30 expiration date.

BLOOMBERG