U.S. congressional negotiators back war funding bill

WASHINGTON (Reuters) - U.S. congressional negotiators on Thursday approved a $106 billion compromise bill largely backing President Barack Obama's missions in Afghanistan and Iraq, but restricting his effort to quickly close the U.S. prison at Guantanamo Bay, Cuba.

The package was in limbo for hours over whether to include a provision to prevent the release of photos by U.S. personnel depicting abuse of prisoners that Obama and some lawmakers fear could provoke a backlash against U.S. troops.

Obama intervened personally to lobby against the amendment but vowed to keep the pictures under wraps. He told lawmakers in a letter that the provision would "unnecessarily complicate the essential objective of supporting the troops."

On Thursday, a federal appeals court in New York stayed an order that the Defense Department release the photographs, giving the Obama administration time to argue its objections before the U.S. Supreme Court.

The American Civil Liberties Union has sued to make the photos public. Lawmakers from the Democratic-controlled Senate and House of Representatives voted along party lines to reject two attempts to reincorporate the provision into the bill.

"All he (Obama) has to do today is use an executive order to declare these photos classified material," said Republican Senator John McCain, who lost the 2008 presidential election to Obama and has pushed to keep the photos from being released.

The overall package includes $79.9 billion for U.S. forces in Iraq where Obama is trying to wind down the American presence and in Afghanistan where the president is ramping up operations to fight remaining al Qaeda militants.

The bill has grown steadily as Obama sought billions of dollars to also combat the H1N1 flu virus, which has now become a pandemic. He also asked for $108 billion in credit lines to shore up the International Monetary Fund as it helps developing countries weather the economic downturn.

Democrats and Republicans have also larded up the bill with a few of their own items like military transport planes the Pentagon did not request and money to spur car sales through vouchers for consumers to buy more fuel-efficient vehicles.

The House and Senate passed different versions of the bill. But negotiators have been hammering it out for weeks and Democrats hope both chambers will approve it next week.

The compromise has been a hard-fought battle for Obama and his fellow Democrats because of several issues, including the abuse photos as well as the IMF funding that Republicans have argued should be considered on its own merits.

The IMF provisions also endorse the lender's plan to sell some 400 tons (12.97 million ounces) of its gold.

FIGHT OVER GUANTANAMO PRISONERS

They also argued over closing the U.S. prison in Cuba where terrorism suspects picked up after September 11 have been held. Obama pledged to close the facility by January 2010 and had asked Congress for $80 million to start that process.

Democrats rejected the money request but brokered a deal that would allow detainees into the United States for trial, although not permanent detention. The bill would also ban releasing any detainees into the country through September 30.

The deal came as the administration this week transferred the first detainee to New York for trial and on Thursday sent four others to Bermuda, one to Iraq and one to Chad.

Republican Representative Jerry Lewis questioned whether the administration was "racing to move these detainees before Congress should enact anything into law."

Obama initially requested $83.4 billion for the wars, but it ballooned 27 percent with all the extras, including more flu money, aid for Pakistan and the IMF credit line, although budget analysts say that will require only a $5 billion backstop.

House Republicans, who were crucial to passing the first version of the war bill last month, have said they would oppose the new version because of the IMF funding. That sent Democrats scrambling to get votes from anti-war members of the party.

But the anti-war Democrats said they would not vote for the bill unless leaders removed the abuse photos provision.

Other provisions in the compromise bill include:

- $2.7 billion for eight Boeing Co C-17 military transport aircraft and seven Lockheed Martin C-130 planes.

- $1 billion for the "cash for clunkers" program, offering consumers vouchers up to $4,500 to trade in their less fuel-efficient cars for vehicles that get better mileage. Negotiators rejected an attempt to strip out the money.

- $1.4 billion in foreign aid to Pakistan, including $700 million for its counterinsurgency effort against militant Taliban forces coming across its border with Afghanistan.

- $7.7 billion for H1N1 flu, although $5.8 billion is contingent on future needs.

(Additional reporting by Steve Holland; Editing by Peter Cooney)