Senator likes loan-grant split for Iraq

Posted: Sunday, October 19, 2003

FAIRBANKS - Sen. Lisa Murkowski has joined with a few other Republicans who want to turn half of President Bush's proposed $20 billion Iraq reconstruction grant into a loan.

The loan versus grant question has dominated the congressional debate over a supplemental spending bill for the Iraq postwar and reconstruction expenses. The president and most Republicans want all the reconstruction aid to be a grant. Anything short, they say, would slow the money's delivery and send the wrong message.

The House on Friday approved a grant-only bill. But Murkowski and seven other Republicans joined mostly Democrats late Thursday on the Senate floor in voting, 51-47, for a compromise amendment.

The amendment would grant $10 billion to Iraq but would offer the other $10 billion as a loan. Then, if other countries agreed to forgive 90 percent of the money that Iraq owes them, the U.S. could convert that $10 billion loan to a grant.

Murkowski said she voted for the compromise to pressure other countries to forgive their loans to Saddam Hussein's government.

"It takes us back to the argument where we were months ago, in encouraging other countries to join us in this effort," Murkowski said.

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