Why are we guaranteeing a loan to a Chinese company?
House Panel's Bill Requires Egypt
To Spend Aid on Rights Promotion
By DAVID ROGERS
Staff Reporter of THE WALL STREET JOURNAL
June 22, 2005; Page A4
WASHINGTON -- The House Appropriations Committee approved a $20.4 billion foreign-aid budget that imposes new terms on economic aid to Egypt and inserts Congress into an Export-Import Bank fight dividing the semiconductor industry.
For the first time in many years, lawmakers would dictate specifically how Cairo must spend a portion of the annual economic aid it receives with Israel as part of the Mideast peace process. No less than $100 million of the $495 million in economic-support funds pledged to Egypt next year would be devoted to education and promotion of democracy and human rights. That includes an estimated $25 million to be distributed through nongovernmental entities to strengthen Egyptian civil organizations.
The action followed warnings this week from Secretary of State Condoleezza Rice that Egypt must move more aggressively toward democracy. Rep. Jesse Jackson Jr. (D., Ill.) defended the Cairo government: "We must see Egypt as a partner and not a second-class ally." Wisconsin Rep. David Obey, the ranking Democrat on the panel and a longtime supporter of the Camp David accords, was scathing.
"We have no obligation to support stupidity," Mr. Obey said. "Is this country the same agent of change it was 20 years ago or is it stalling out?"
The Export-Import Bank provision involves a proposed $770 million loan guarantee to help a major Chinese semiconductor company expand its production capacity by buying equipment from several U.S. companies.
Applied Materials Inc. has a major stake in the venture because the Santa Clara, Calif., company expects to have a lead role in providing support for the expansion efforts of Semiconductor Manufacturing International Corp. of Shanghai. Opposing the deal is Micron Technology Inc., a Boise, Idaho, chip maker that fears a U.S. loan guarantee to aid an overseas competitor will come back to haunt U.S. companies.
Each side has accused the other of muscling the Export-Import Bank, whose chairman, Philip Merrill, has yet to bring the loan application before the bank's board to be acted upon. Applied Materials and its allies say Mr. Merrill's "pocket veto" is being dictated by Micron and Idaho Republicans, including Sen. Mike Crapo, chairman of the Senate Finance trade subcommittee. The California company jumped into the fray, and yesterday's amendment -- angrily protested by Rep. Mike Simpson (R., Idaho) -- built on an Applied Materials lobbying campaign intended to show its clout among lawmakers in New York, Texas and its home state, also home to Appropriations Chairman Jerry Lewis.
"The Export-Import Bank should act promptly on all applications for assistance," reads the language, added to the legislative report accompanying the foreign-aid package. Within 60 days of the budget bill's enactment, the bank would be required to report back to the panel on the status of all pending applications and explaining "any rejection of requests for assistance, specifically applications affecting the semiconductor industry."
An Applied Materials spokesman said the language "is intended to alleviate the political pressure" on the bank to make it easier to move forward. Jason Kreizenbeck, Micron's director of government affairs, countered that "trying to legislate a change to this decision now ... would set a terrible precedent."
The action on the foreign-aid budget came as the House committee yesterday evening approved a $134.9 billion domestic-spending bill that would make deep cuts in Amtrak subsidies and halve a funding increase sought by the Internal Revenue Service to expand tax-enforcement operations.
The panel agreed to give civilian federal employees the same 3.1% pay raise promised the military. In a shot at the credit-card industry, eight Republicans joined Democrats on a 33-25 vote to add language barring the use of negative consumer reports to raise interest charges on a customer, unless the report dealt with activity related to that specific account.
Less successful was a bipartisan effort to salvage the federal Youthbuild program to train often troubled youths in construction trades. A proposal to restore $50 million to the budget bill failed 30-28.
Meanwhile, the Senate Appropriations Committee gave initial approval to a revised $16.4 billion budget for the National Aeronautics and Space Administration and $4.5 billion for the National Oceanic and Atmospheric Administration. The NOAA funding is substantially more than the House approved last week. |
