Congress trims Bush anti-drug plan for Mexico

WASHINGTON (Reuters) - The House of Representatives on Thursday voted to scale back President George W. Bush's plan to aid Mexico in its increasingly deadly war on illegal drug cartels.

The so-called Merida initiative -- which Bush proposed last October as a three-year $1.4 billion package providing aircraft, equipment and training -- initially was to offer Mexico $500 million in this fiscal year that ends September 30.

But lawmakers reduced this year's segment to $400 million in a 256-166 vote on legislation that also expanded benefits for U.S. veterans of the Iraq and Afghanistan wars and lengthened unemployment benefits for U.S. workers.

The Democratic-controlled chamber sought to restrict support for the Mexican military, while increasing resources for social institutions including the country's judiciary.

But analysts said the cutback was less than expected and described the vote as an important U.S. gesture toward Mexico.

More than 1,100 people have been killed in Mexico this year as drug gangs fight each other and security forces.

Across Capitol Hill, the Senate Appropriations Committee set Mexico's funding level at $350 million. Full Senate debate of the measure could come next week.

The House increased a part of the Merida initiative to fight drug trafficking in Central America, to $61.5 million from the $50 million the White House sought. Lawmakers also added the Caribbean nations of Haiti and the Dominican Republic to share the funds.

The Senate panel set aside $100 million for Central America, Haiti and the Dominican Republic.

The Bush administration had urged Congress to avoid large cutbacks that could embarrass the government of Mexican President Felipe Calderon as Washington is pressing for closer security ties between the two countries.

The Merida initiative would not give Mexico money outright, but would provide equipment such as helicopters, planes and inspection scanners as well as training for police, prosecutors and judges.

Calderon, a conservative who has sent 25,000 troops and federal police to fight drug cartels across Mexico since late 2006, pledged last week to take back Mexican streets from drug peddlers and gunmen.

Much of his effort has been focused on fighting drug gangs along the U.S.-Mexico border, especially near Texas.

"Though the amount is reduced, the vote conveys to the Calderon government and the Mexican people that both the U.S. administration and Congress are interested in supporting institutions and strengthening law enforcement," said Armand Peschard-Sverdrup of the Center for Strategic and International Studies in Washington.

On Wednesday, the House Foreign Affairs Committee authorized Congress to spend up to $1.6 billion on the Merida initiative overall.

But the panel's bill, which sets out policy but does not provide the funding, said the program should be geared more heavily toward supporting the rule of law, with less assistance for the Mexican military partly because of concerns of human rights abuse allegations.

(Additional reporting by Richard Cowan, editing by Vicki Allen)