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Hefty loans likely for steel, oil

WASHINGTON -- Struggling U.S. steel, oil and natural gas companies may soon get some relief through $1.5 billion in taxpayer-backed emergency loans under Senate consideration.

A Senate vote could come as early as Wednesday, a day after legislation creating the loan programs cleared a key procedural hurdle. The Senate voted 70-29 on Tuesday to limit debate on the bill. That is 10 more votes than the 60 needed.The strong support on the procedural matter signaled that the bill's supporters would prevail. Sen. Robert Byrd, D-W.Va., said the future of the U.S. steel industry was at stake.

"Are we going to ship another U.S. industry, the steel industry, overseas?" he asked colleagues. "Are we going to allow foreign entities to make ghost towns of our steel-dependent communities?"

A similar program for small oil and gas firms was added earlier as part of a compromise with Sen. Pete Domenici, R-N.M.

The bill would provide $1 billion in loans to domestic steel producers injured by low-priced imports and $500 million for U.S. oil and natural gas industries hurt by sagging prices. The taxpayer cost for the new loan programs is put at $270 million.

Conservative senators who opposed the bill argued that the extra spending would come directly from Social Security surpluses -- money that Republicans have pledged repeatedly this year not to touch.

"You can't be for not plundering the Social Security trust fund and be for this" steel and oil bill, said Sen. Phil Gramm, R-Texas, an oil-producing state.