Washington, D.C. – Defying President Bush’s request to keep the Wartime Emergency Supplemental bill clean from extraneous and wasteful expenditures, Senate Appropriators increased shipbuilding loan guarantees to $50 million, almost $46 million over the President’s request.

“This program is one of the worst examples of corporate welfare in Washington,” said Keith Ashdown, Vice President of Policy at Taxpayers for Common Sense. “Behind closed doors and under the guise of homeland security, lawmakers got this wasteful provision added to the bill.”

The Maritime Administration, through the Maritime Guaranteed Loan Program (title XI) subsidizes loans for ships built in U.S. shipyards. For the last several years, President Bush has attempted to cut the program’s funding, but supporters including Sens. Breaux (D-LA), and Lott (R-MS) have managed to keep it alive.

“Lawmakers like loan guarantees because they don’t appear to cost taxpayers. Yet, after hundreds of millions in loan defaults have occurred, taxpayers’ now have to pay the piper,” continued Ashdown. “Even though this program is a fiscal fiasco, the shipbuilding program will probably get this money because a few senators will go to the ends of the earth to make sure it’s well-funded.”

According to a new audit by the Department of Transportation’s Office of the Inspector General, ship builders have defaulted on over $490 million in taxpayer-backed loans in the last five years and the Maritime Administration has only recouped $87.3 million of this amount. Enron Corp is expected to default on another $122 million in loans in the near future.

“This spending is supposed to pay for Iraq, the War on Terror, and protecting the homeland – not for goodies for the special interests. Lawmakers who turn this must-pass bill into a gravy train should be ashamed of themselves.” concluded Ashdown.

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