Washington, DC, April 18--The trade association representing U.S. manufacturers said on Friday it was encouraged by a Senate plan to create a $140 billion asbestos compensation fund, but stopped short of an endorsement.
The statement by the National Association of Manufacturers was the first formal reaction to the plan from the U.S. business community, which would be called on to finance the proposed fund to pay asbestos claims.
Agreement was reached this week by Pennsylvania Republican Sen. Arlen Specter and Vermont Democrat Sen. Patrick Leahy. But some of Specter's Republican colleagues want to make refinements before the plan is introduced as legislation and will meet Tuesday for discussions.
"I'm encouraged by the renewed commitment on both sides of the aisle," NAM president John Engler said in a statement on the organization's Web site. "I am more hopeful about prospects for consensus than I have been in weeks."
Engler said he found "much to like" in the draft. But he suggested he did not consider it a final product, saying that when the business community's review is complete, "we hope a solution will finally be at hand."
Some manufacturers, such as auto parts supplier Federal- Mogul Corp. based in Southfield Michigan, began criticizing the fund plan months ago, complaining their contributions would exceed the asbestos-related costs they now face.
The fibers of asbestos, which was used in building materials, auto parts and other products for decades, have been linked to cancer and other diseases. Injury claims have forced many companies into bankruptcy.
The fund would be financed by companies facing asbestos lawsuits -- many of them manufacturers -- and their insurers.
Victims, meanwhile, would no longer be able to sue and would have to apply to the fund for compensation.
One of the largest labor unions in North America, the United Auto Workers, endorsed the Specter-Leahy proposal earlier this week, saying it would provide equitable, timely and certain compensation to asbestos victims.
But the umbrella labor organization, the AFL-CIO, has said nothing publicly about the proposal.
Insurers are known to be divided on the issue, with some such as American International Group Inc. opposed. Their trade associations have stayed mum while they consult.
"We have analyzed the draft. We still have some concerns, which we will be articulating, but we have not taken a formal position yet," said Julie Rochman, spokeswoman for the American Insurance Association, which represents most of the large commercial insurance carriers with asbestos liabilities.
"We hear there will be some refinements," she added. "We've got companies we've got to talk to."
One victims' group, the Committee to Protect Mesothelioma Victims, said the plan fell short of the compensation needed.
Mesothelioma is a lethal cancer linked to asbestos. Its victims would receive $1.1 million under the plan.
