A fierce dispute over earmarks has surfaced as the main obstacle in Senate negotiations over the annual defense authorization bill.

Armed Services Chairman Carl Levin , D-Mich., and other panel leaders have resisted allowing a vote on an amendment by Republican Jim DeMint of South Carolina that would effectively give the Defense and Energy departments the flexibility to disregard more than $5 billion in defense earmarks.

DeMint has held up the $612.5 billion defense policy measure (S 3001) until he gets a vote on his proposal. His supporters include the Senate’s top Republican, Mitch McConnell of Kentucky, and Tom Coburn , an Oklahoma Republican and a leading anti-earmark crusader.

The White House is siding with DeMint, saying it “strongly opposes” the bill’s earmarks and what many Republicans consider the measure’s attempts to circumvent an order by President Bush to combat excessive spending.

Earmarks have become a central feature of many congressional campaigns and the presidential contest this year. John McCain and Barack Obama are both touting their credentials as reformers of Washington’s spending practices, while the earmark record of Alaska Gov. Sarah Palin , the GOP vice presidential candidate, has been the subject of intense scrutiny.

Coburn said the aim of the DeMint amendment was to thwart the billions of dollars in projects not requested by the military that lawmakers have funneled toward particular companies.

“Of the $5.9 billion in earmarks in this bill, the vast majority are not competitively bid,” said Coburn.

The defense policy bill authorizes spending on national security for the fiscal year that begins Oct. 1. The Senate Armed Services Committee passed its bill in late April; the House passed its own $612.5 billion version (HR 5658) in May. Senate leaders hope to pass the bill on Sept. 16 but plan no votes until then, though more than 220 amendments have been filed.

Anatomy of a Misunderstanding

The earmarks debate that is now holding up the defense bill grows out of a complicated set of executive and legislative moves.

In January, Bush put forth an executive order telling U.S. agencies they needed to heed only earmarks that are included in statutory language, not those embedded in reports accompanying bills.

The Senate Armed Services Committee’s earmarks are listed in the report, not the bill. But the bill contains language that stipulates that the earmarks should be considered a part of the bill.

To DeMint, Coburn and other critics, putting the earmarks in the bill by reference, not in specific language, effectively means that federal agencies must honor the earmarks that are not actually in the bill, where they could be amended during floor debate. DeMint’s amendment says simply, “Strike section 1002” (the earmark stipulation). The White House, in a statement of policy on the bill, said: “Both section 1002 and the earmarks in the report should be removed.”