Democrat Brown Pushes for U.S. Loans to Manufacturers in Energy Measure

Senator Sherrod Brown, an Ohio Democrat wary of the impact of climate legislation on U.S. manufacturers, says he is pushing to include billions of dollars of loans and tax credits in any energy measure.

Brown said he wants the Senate to add $30 billion in government-backed loans for manufacturers, and is asking the Obama administration for an additional $5 billion in tax credits for companies that invest in clean-energy facilities.

Those provisions might help struggling U.S. manufacturers expand, and induce companies in China, Japan and Europe to open up factories in the U.S., he said.

“There are certainly ways to encourage companies to invest here, and hire Americans,” Brown said in an interview at Bloomberg’s Washington office. “We can’t continue to be a prosperous, middle-class society if we don’t keep making things.”

Brown has organized a bipartisan group of Midwestern lawmakers worried that climate legislation would undercut local manufacturers and give an advantage to overseas competitors in countries such as China. Brown has proposed including a Buy America provision in any climate bill and helped frame a letter to lawmakers drafting the legislation saying it must include import tariffs to protect domestic producers.

If pollution limits are imposed without providing help to manufacturers, climate-change legislation will be “a self- defeating effort” by moving jobs to countries with lower environmental standards, Brown and other senators wrote in a letter to Senators John Kerry of Massachusetts and Joe Lieberman of Connecticut in April.

Cap-and-Trade

Cap-and-trade legislation creating a market for companies to buy and sell a declining number of pollution rights hasn’t advanced in the Senate after passing the House last year. President Barack Obama is scheduled to meet with lawmakers to discuss the measure tomorrow.

Brown said today he wasn’t assuming that Buy America provisions in an energy bill would pass. He didn’t discuss the issue of tariffs on imports.

Instead he said government-backed loans and tax credits could be used to boost American manufacturers and create green jobs in the U.S.

Last year’s economic stimulus provided $2.3 billion in tax credits, for investments in new or expanded U.S.-based advanced energy manufacturing facilities. Those credits have run out, and Brown said he wants the administration to provide $5 billion in new funding.

Brown said he was encouraged by the reaction of Kerry and the Obama administration to his proposal for a government-backed fund that would provide credit help to small manufacturers who improve energy efficiency or expand clean energy operations.

To contact the reporters on this story: Mark Drajem in Washington at mdrajem@bloomberg.net; Jim Snyder in Washington at jsnyder@bloomberg.net.

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