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Tuesday, October 21

House wins moral victory on Iraq, but Bush threatens veto

By Jon Frandsen | GNS

WASHINGTON - Backers of making reconstruction money for Iraq a loan won a lopsided, but symbolic victory in the House on Tuesday. But President Bush is likely to prevail and see the money go to the struggling but oil-rich nation with no strings attached.

The White House issued a statement threatening a veto of the nearly $87 billion spending request for the occupation and reconstruction of Iraq and Afghanistan if the loan proposal was included. Supporters and critics of the loan predicted that approach was likely to die.

The House's 277-139 vote was nonbinding, but Bush critics said it was a stunning display of discontent with the administration's Iraq policy.

The resolution asked House leaders to adopt the same loan proposal that the Senate approved last week, despite days of intense lobbying by Bush and top administration officials.

``What the administration needs to ask itself ... is, `Why did you have to work so hard and still not win?'' said Sen. Lindsey Graham, R-S.C.

Rep. Mike Pence, R-Ind., leader of pro-loan forces in the House, said he was hopeful the vote and continued pressure from the public would prompt House-Senate negotiators to leave the loan proposal in the final bill.

``I think that ultimately the consent of the governed drives the Congress,'' Pence said.

But Graham, Pence and other proponents of the loan proposal said there will not be a fight if the final spending package makes the money a grant.

``I expect our provision will not prevail despite what I believe is strong support for it,'' said Sen. Susan Collins, R-Maine, one of the principle authors of the Senate loan measure.

House Appropriations Committee Chairman Bill Young, R-Fla., who will be one of the negotiators of the final bill, said the House would stick to its approach and support the president. ``... I expect the conference report will drop the loan provision,'' he said.

Bush has strongly opposed the loan proposal, saying debt could drag Iraq down as it tries to transform itself from a brutal dictatorship into a democracy.

He also warned that requiring Iraq to repay loans with oil revenues would reinforce widespread suspicions abroad that the primary U.S. motive for war was control of the second largest oil reserve in the world.

But those arguments held little sway in the Senate, which voted 51-47 last week to convert about half of the $20.3 billion for Iraqi reconstruction into a loan. House Republican leaders blocked a vote on the identical measure last week, but could not forestall a vote on the nonbinding measure.