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Democrats Strike Back At GOP For Attempts To Make Cuts To Department Of Energy Loan Program

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MCCARTHY CANTOR
House Majority Whip Kevin McCarthy of Calif., right, joins House Majority Leader Eric Cantor of Va., left, as they speak to reporters about President Obama's debt reduction plan and other issues, Tuesday, Sept. 20, 2011, on Capitol Hill in Washington. (AP Photo/J. Scott Applewhite) | AP

WASHINGTON -- Democratic leaders on Tuesday struck back against House Republicans' efforts to make cuts to a Department of Energy loan program in exchange for disaster aid.

They argued that the attack on the Advanced Technology Vehicles Manufacturing Loan Program, which began in September 2008 and allocates funds for U.S. automotive industry projects, would harm job creation and hurt the American people. The program is the latest piece of the 2007 Energy Independence and Security Act that Republicans have been trying to chip away at since George W. Bush signed it into law.

In anticipation of the next continuing resolution for fiscal year 2012, which will fund government operations beyond Sept. 30, the House GOP proposal cuts $1.5 billion from a program designed to help car-makers bring production back to the U.S. and develop higher efficiency vehicles and factories. More than half of the money would be transferred to cover relief efforts for natural disasters this summer and one-third would simply go back to the Treasury.

Senate Majority Leader Harry Reid (D-Nev.) and Sen. Mary Landrieu (D-La.) chastised Republicans Tuesday for targeting a program that creates jobs.

"I don't know why the House Republican leadership is doing this, it makes no sense," Landrieu said.

Seventy-nine Democratic members of the House who oppose cutting the loan program signed a letter that was sent to Speaker John Boehner (R-Ohio) on Tuesday. Reps. Gary Peters (D-Mich.), Anna Eshoo, (D-Calif.), Henry Waxman (D-Calif.) and John Dingell (D-Ga.) began circulating the letter around the House late last week.

A coalition of environmental groups, including the Sierra Club and the Union of Concerned Scientists, joined with the United Steel Workers and United Auto Workers in opposition as well, sending letters Tuesday to senators urging them to reject the provision to make cuts to the program.

The Energy Independence and Security Act allowed up to $25 billion to be loaned out to auto manufacturers. Automakers had to meet specific criteria to be eligible to even apply for the loans, set by the Department of Energy, and the money has to be repaid. The act also mandated that inefficient light bulbs be phased out, introduced the first significant increase to cars' fuel standards in decades and expanded support for green technology research and the pursuit of green jobs, among other provisions.

Republicans are increasingly skeptical of loan programs from the Department of Energy in light of Rep. Darrell Issa's (R-Calif.) announcement he will investigate government aid for businesses like the failed energy company Solyndra. They have also been taking shots at the energy act in various ways, particularly with legislation earlier this year to repeal the mandated phase-out of inefficient light bulbs, and have been pressuring President Obama to move forward on the Keystone XL pipeline project, despite key Democrats warning its construction may violate the act. And nearly every GOP presidential candidate is talking about scaling back regulations designed to improve the environment.

Making cuts to a loan program in order to offset disaster relief is not a new idea: House Republicans proposed pulling its funding back in May to offset emergency funding for rebuilding efforts after tornadoes devastated Missouri.

Speaking with reporters Tuesday, House Majority Whip Kevin McCarthy (R-Calif.) referenced a trip he took to South Carolina to visit a Boeing factory, which he praised as having the type of "made in America" jobs he'd like to see become more widespread. But the House continuing resolution could effectively put an end to a program that has done just that with auto manufacturing jobs.

Experts told The Huffington Post they credit the program with enabling Ford to bring the production of its Focus model back to the U.S. from Mexico and making it possible for Nissan to build its LEAF car in Tennessee.

"We're working to save a program that was created with bipartisan support and has literally brought thousands of auto jobs from Mexico to Detroit," Peters said.

Democrats argue the program has created or saved 41,000 jobs so far, a figure that will double by year's end. Those jobs haven't been isolated to Michigan either; they've extended into Kentucky, Louisiana, Delaware, California, Ohio and several other states.

"Before the end of this year, as many as 11 more companies are expected to receive ATVM loans ... An additional 12 ATVM applications now in the early stages could create another 10,000 jobs next year. This auto manufacturing growth in turn boosts economic activity in other industries and communities across the country," read a letter Tuesday from a coalition of environmental and labor groups.

House Democratic leaders did not indicate Tuesday that they would reject a continuing resolution if it includes cuts to the program, but House Minority Whip Steny Hoyer said they would back Democratic colleagues on the Senate side.

"You need to pass the CR, you need to keep the government funded -- you don't need to do it in this manner," Hoyer said.

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