The Democratic leader of the Senate said Tuesday that he'll try this week to add almost $7 billion in disaster aid to must-pass legislation to avert a government shutdown at the end of the month.
The move by Majority Leader Harry Reid sets up the second fight in as many weeks with Senate Republicans over disaster relief. And an even bigger battle could await with the GOP-controlled House if Reid is again successful in muscling the measure through the Senate.
The two sides are divided over how much disaster aid to provide immediately and whether a portion of it should "paid for" with cuts to an Energy Department program that subsidizes low interest loans to car companies to build more fuel efficient vehicles.
The first move this week, however, comes in the House, which is scheduled to vote Wednesday on the stopgap measure. The legislation would fund the government at current levels into November and also contains $3.7 billion in disaster aid. But the House measure would cut $1.5 billion from the loan subsidy program to offset a $1 billion portion of the aid money that's needed to prevent a cutoff of the government's chief disaster relief programs near the end of this month.
Democrats say the cuts to the loan program for car manufacturers could cost up to 10,000 jobs because there wouldn't be enough money for all pending applications. The low-interest loan program is aimed at helping car companies and parts manufacturers retool factories to build vehicles that will meet new, tougher fuel economy standards.
"While the government has a responsibility to fund disaster response in places that were devastated by Hurricane Irene or other natural disasters, it is unconscionable to use funds designed to create jobs in manufacturing states to pay for it," Reps. Gary Peters, D-Mich., and Anna Eshoo, D-Calif., said in a letter Monday night to House Speaker John Boehner, R-Ohio.
They credited $3.5 billion of loan subsidies with supporting loans totaling $9.2 billion that created or saved 41,000 jobs in Tennessee, California, Indiana, Michigan, Delaware, Illinois, Kentucky, Missouri and Ohio. Ford Motor Co. and Nissan Motor Co. have already received loans; Chrysler Group LLC is awaiting final approval of a loan.
The underlying stopgap funding measure would finance the government through Nov. 18 to give lawmakers more time to try to reach agreement on the 12 unfinished spending bills needed to run government agencies on a day-to-day basis for the 2012 budget year that begins Oct. 1.
House GOP leaders said they were confident of passing the stopgap measure even though most Democrats are expected to oppose it over the cuts to the car manufacturing loan subsidies. But with the most conservative Republican members of the House unhappy over the spending rates in the stopgap measure, which reflect last month's budget agreement with President Barack Obama but are significantly above earlier levels set under a GOP budget measure, GOP leaders were scrambling Tuesday to solidify support for the measure.
Reid, D-Nev., said that once the stopgap measure passes the House, he'll move to substitute the Senate's $7 billion aid package for the House's version. It will take at least seven Republicans to join with majority Democrats to win the 60 votes likely required to defeat GOP blocking tactics. Ten Republicans voted with Reid last week to pass the stand-alone disaster aid measure, but their votes can't be taken for granted now. Tea party favorites like Sens. Marco Rubio, R-Fla., and Pat Toomey, R-Pa., were among those who voted with Reid last week, but the partially paid for House version may be more to their liking.
In fact, Senate Minority Leader Mitch McConnell, R-Ky., predicted that the conflict could be worked out in time for the Senate to make a Thursday night getaway to a weeklong recess.
"Congress always responds appropriately to disasters," McConnell said. "We're having a discussion about the appropriate way to do that, and I'm confident it will be resolved."