Legislation to provide $1.5 billion in federally guaranteed loans to ailing steel companies and small firms in the oil and gas industry cleared a major hurdle yesterday as the Senate derailed a filibuster against the measure and put it on track for passage.
The 71-to-28 vote to proceed with action on the measure came despite protests that its projected $270 million cost over the next two years would dip into Social Security surpluses that a majority of the Senate, including nearly all Republicans, had just voted to shield.
"We can't have it both ways," protested Sen. Phil Gramm (R-Tex.). "We can't stand up an hour ago and say `Don't plunder Social Security' and then an hour later say `Well, if it is for a good reason, like providing loan guarantees for steel and oil, it is okay to plunder Social Security.' "
But others, including Sens. Robert C. Byrd (D-W.Va.), speaking for the steel industry, and Pete V. Domenici (R-N.M.), arguing for struggling "oil patch" companies, said the loans were needed to help protect thousands of jobs that have fallen through the cracks of a prosperous economy.
"Are we going to ship another industry overseas . . . are we going to allow foreign entities to make ghost towns of our steel-producing communities?" asked Byrd, who said the loan guarantees were needed to cushion the impact of what he described as "illegal dumping" of low-cost steel by other countries.
The U.S. oil industry has already lost 340,000 jobs as a result of low production and companies, including those that service oil wells, cannot get loans to keep from going "belly up," Domenici argued.
Twenty-six Republicans supported the loan guarantee proposal after voting earlier to wall off Social Security surpluses from being used for spending programs or tax cuts. All 45 Democrats voted for the loan guarantees, just as they had voted as a bloc earlier against the Social Security measure. While the Social Security proposal won a majority of the Senate's votes, it -- unlike the loan guarantee bill -- fell short of the 60 needed to break a filibuster.
The loan guarantee proposal had originally been included by the Senate in an emergency $15 billion spending bill for Kosovo operations and disaster relief but was dropped at the insistence of House negotiators, who agreed to consideration of a separate bill on the subject.
Final Senate action on the legislation could come later this week, according to leadership aides. While yesterday's action virtually guarantees Senate approval, the outcome in the House is less clear.
Despite opposition to inclusion of the loan guarantees in the emergency spending bill, the House earlier passed a bill to force a cutback in steel imports, and Rep. Alan B. Mollohan (D-W.Va.), who supports both measures, said he believes most of the Republicans who voted to cut imports will support the guarantees as well.