Pelosi and Reid Condemn Bush Plan to Veto of Defense Authorization Bill

Washington, D.C. -- Speaker Nancy Pelosi and Senate Majority Leader Harry Reid issued the following statement today criticizing President Bush's expected veto of H.R. 1585, the fiscal year 2008 National Defense Authorization Act, in response to assertions by the Iraqi government that one section could expose assets in U.S. banks to requests for compensation for American victims of Saddam Hussein.

"Despite the Administration's earlier support for the Department of Defense authorization bill, it appears that President Bush plans to veto this legislation, which is crucial to our armed forces and their families.

"The Defense bill passed both houses of Congress by overwhelming bipartisan margins and addresses urgent national security priorities, including a 3.5 percent pay raise for our troops and Wounded Warriors legislation to remedy our veterans' health care system. It is unfortunate that the President will not sign this critical legislation.

"Instead, we understand that the President is bowing to the demands of the Iraqi government, which is threatening to withdraw billions of dollars invested in U.S. banks if this bill is signed.

"The Administration should have raised its objections earlier, when this issue could have been addressed without a veto. The American people will have every right to be disappointed if the President vetoes this legislation, needlessly delaying implementation of the troops' pay raise, the Wounded Warriors Act and other critical measures."

Background

On December 19th, Congress sent H.R. 1585, the fiscal year 2008 National Defense Authorization Act, to the President for his signature. The Bush Administration had worked closely with the Congress in the development of this legislation and gave no indication prior to its passage that one section of the bill could generate a presidential veto.

Subsequently, the government of Iraq raised objections to Section 1083, in which Congress strengthened the ability of victims of the brutality of Saddam Hussein to seek compensation. The Iraqi government has warned that plaintiffs, including former U.S. POWs who had been held captive during the first Gulf War in the 1990s, might cite this section in seeking compensation from its assets currently in U.S. banks -- reportedly $25 billion. The Iraqi government has threatened that, unless President Bush agrees to veto the Defense Department legislation, Iraqi leaders will immediately move assets out of U.S. banks.

Congress and the White House have been engaged in discussions about reviewing the effect of Section 1083 and considering whether additional action is warranted. Congressional leaders have indicated a willingness to consider technical corrections to resolve the Administration's new objections, if justified.

The Administration, however, reportedly intends to move ahead and announce that the President intends to veto H.R. 1585, placing in jeopardy the military pay raise and the Wounded Warrior program endorsed by the Congress, and complicating efforts to address concerns raised about Section 1083.