On the day the Bush administration won an international victory by convincing the United Nations Security Council to approve the creation of a multinational force to police and rebuild Iraq, it suffered a minor setback at home with Senate approval of a plan to make $10 billion of the U.S. aid to Iraq a loan. The White House opposed the loan proposal, put forward by Maine Sens. Susan Collins and Olympia Snowe and a bipartisan coalition of six other senators. The loan proposal was passed Thursday by a vote of 51 to 47 setting up a contentious conference on the measure, since the House defeated a similar plan by a vote of 226 to 200.

It is a small, but meaningful, disagreement given the fact that the president’s request for $87 billion to secure and rebuild Iraq and Afghanistan will ultimately be passed by lawmakers. The House chipped more than $1.5 billion from its version of Iraq’s rebuilding package by refusing funds for garbage trucks, ZIP codes and restoration of marshlands. The Senate approved the full $20.3 billion the president requested. The rest of the money, more than $66 billion, will go toward U.S. military operations in the two countries.

The battle now is over what form the rebuilding assistance will take. President Bush wants all the money to be in the form of a grant. The Senate wants it to be a loan that Iraq will repay with future oil revenues. To make the loan idea more palatable, senators agreed that the $10 billion loan could be converted to a grant if other countries agreed to forgive at least 90 percent of the debt they are owed by Iraq. This is an important concession, especially because although the U.N. Security Council supported the establishment of the multinational force led by the United States in Iraq, its members did not agree to contribute troops or money to the cause. Clearly, the international community can do more to help and this is the Senate’s way of pushing the White House to seek that international assistance.

Although personally asked by the president to change her mind, Sen. Collins said she remains steadfast that a loan makes sense given the prospect for lucrative oil profits. “I do not believe that it is unfair to ask the Iraqi people to invest in their own future by repaying the American taxpayer some of these dollars used to construct their infrastructure, particularly because they will clearly have the ability to do so one day,” Sen. Collins said Thursday.

She and the bipartisan supporters are right. Given the United States’ own growing budget deficit, asking that a small part of the money this country will spend to rebuild Iraq is repaid is reasonable.