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Senators Vow to Close Stimulus Loophole

Several of President Barack Obama's strongest supporters in the U.S. Congress say a big loophole in the economic stimulus bill they passed last year is helping foreign companies.

The problem is with the portion of the economic stimulus bill used to fund alternative energy projects.

If a project is being constructed by the government, all the components must be American made.

But that is not necessarily the case if the facility in question is being built by the private sector.

In west Texas, for example, a local energy consortium has stuck a deal with a Chinese firm to build one of the largest wind energy projects in the United States. The $1.5 billion enterprise is slated to receive $450 million in stimulus grants - much of it going for the purchase of Chinese-built wind turbines.

Senator Charles Schumer of New York is furious. He says stimulus money that should be spent to create American jobs is instead creating employment opportunities in China.

"It is hard to believe. It is infuriating. That is not why we voted for a stimulus," said Schumer. "The stimulus was to create jobs in the United States of America."

Schumer says overall, most of the $2 billion already allocated for alternative energy grants has gone to foreign companies. He says all this comes at a time when the Obama administration is trying to encourage the development of alternative energy technologies in the United States.

"There is a race going on right now to pioneer the next generation of energy technologies," he said. "We won't keep pace if we don't invest in our own country's manufacturing sector."

Schumer is one of four Senate Democrats urging colleagues to pass legislation to close the loophole that permits the use of stimulus energy grants to buy goods and services abroad.

Most are from old manufacturing states in the Middle Atlantic region - like Robert Casey of Pennsylvania. He says in some cases, the stimulus bill is working very well but adds there are flaws that must be addressed.

"I think anyone standing in the way of making a correction like this, does so at their own peril," said Casey.

Casey and Schumer say they remain firm backers of the economic stimulus bill. So does Senator Sherrod Brown of Ohio. But Brown says the intent was never to give another country an unfair advantage.

"Do we want to wean ourselves from foreign oil and replace it with an addiction to wind turbine manufacturers and solar panel manufacturers in other countries?" asked Brown.

Schumer, Casey, Brown and Montana Senator Jon Tester have been pushing the matter privately with administration officials for several months. They say they believe legislation to close the loop hole will pass Congress easily with strong bipartisan support.