US President to veto National Defense Authorization Act for Fiscal Year 2008
US President Bush intends to veto the National Defense Authorization Act for FY08 (NDAA) because particular provisions included in the bill risk imposing financially devastating hardship on Iraq that will unacceptably interfere with the political and economic progress everyone agrees is critically important to bringing our troops home. Section 1083 of the NDAA amends the Foreign Sovereign Immunities Act, which establishes rules on how foreign countries may be sued under U.S. law. The amendments would dramatically change these rules and potentially invite foreign governments to take reciprocal action allowing suits to proceed against the United States even for legitimate government activities.
Among other things, Section 1083 would allow plaintiffs’ lawyers pursuing Iraq for Saddam-era acts of terrorism to freeze Iraq’s assets in the amount of damages claimed in their lawsuits, and would permit the relitigation of billions of dollars of lawsuits against Iraq that have already been dismissed by our courts. At the same time, by subjecting the democratically elected Government of Iraq to this liability, the provision would imperil billions of dollars of Iraqi assets at a crucial juncture in that Nation’s reconstruction efforts and undermine the foreign policy and commercial interests of the United States.
The potential liability created by Section 1083 could reach multiple billions of dollars and subject the Development Fund for Iraq and Iraq’s central bank reserves, which are both essential to building on security gains, to attachment and liens. The provision would tie up Iraqi assets in litigation, and would have a potentially devastating impact on the Government of Iraq with serious implications for U.S. troops in the field, which count on Iraqi funds to expand and equip the Iraqi Security Forces and provide an antidote to terrorists and insurgents.
Once in place, the restrictions on Iraq’s funds that could result from the bill could take months to lift, and thus Section 1083 cannot become law even for a short period of time. The Bush Administration is working with Congress to fix the flawed provision as soon as possible after Congress returns in January. With modifications that fix this provision, the President would sign a new bill into law.
Statement by Deputy Press Secretary Scott Stanzel says ” We are consulting with the leadership of the Congress on the need for a modification to H.R. 1585 to prevent these effects on our close ally Iraq. The NDAA includes authorization for a 0.5 percent additional pay raise for our Nation’s troops, on top of the 3 percent increase that will go into effect on January 1 without the NDAA. As soon as possible upon Congress’s return in January, the Administration will work with Congress to enact the NDAA adjusted in a manner that protects Iraqi funds in the United States and that ensures that the additional pay raise for our troops is retroactive to January 1.”
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