published Sep 28th 2016, 11:30 am, by Steven T. Dennis and James Rowley

(Bloomberg) —
The Senate defied a last-ditch lobbying effort by the White House and Saudi Arabia by voting Wednesday to override President Barack Obama’s veto of a bill that would allow the kingdom to be sued for involvement in the Sept. 11 attacks.

The overwhelming 97-1 vote was more than enough to clear the two-thirds threshold needed to override the veto. Congress has yet to override a veto by Obama, but that is likely to change when the House holds its override vote, which is expected Wednesday afternoon. If two-thirds of the House votes to override, the bill will become law.

The result could prompt Saudi Arabia to delay its first international bond out of concern that some investors may balk over the issue, two people with knowledge of the matter said. Saudi Arabian officials haven’t made a decision yet on the timing of the bond or the amount they plan to raise, Finance Minister Ibrahim Al-Assaf said in a statement to Bloomberg.

The bipartisan Sept. 11 lawsuit bill is sponsored by the No. 2 Senate Republican, John Cornyn of Texas, and the expected future Democratic leader, Chuck Schumer of New York, and it has the backing of both presidential candidates, Hillary Clinton and Donald Trump.

‘Long-Term Consequences’

The president might still have a shot to block it in the House, where Armed Services Chairman Mac Thornberry of Texas urged his colleagues in a letter not to override the president’s veto.

“We ought to be careful about what we do because it has long-term consequences,” he said in an interview. But he wasn’t confident the veto would be sustained.

“I will be voting to override it,” Nancy Pelosi of California, the House Democratic leader, said Tuesday at a news briefing. Speaker Paul Ryan said he too supports the bill.

White House Press Secretary Josh Earnest told reporters Tuesday that Obama’s concern isn’t about how a particular judge might rule on a case involving Saudi Arabia, but how the precedent of removing sovereign immunity could impact U.S. activities around the world.

Obama wrote a letter Tuesday to Senate Minority Leader Harry Reid amplifying his case against the bill.

The measure “sweeps much more broadly than 9/11 or Saudi Arabia, and its far-reaching implications would threaten to undermine important principles that protect the United States, including our U.S. armed forces and other officials overseas, without making us any safer,” the president wrote. “That’s why I vetoed the bill and why I urge you to vote to sustain the veto.”

John Brennan, the director of the Central Intelligence Agency, also made a last-minute appeal to lawmakers to sustain the veto, warning the bill could have “grave implications” by undermining the concept of sovereign immunity.

“No country has more to lose from undermining that principle than the United States — and few institutions would be at greater risk than CIA,” he wrote.

Victims’ Families

Politically, however, it’s very hard for lawmakers to make an abstract argument about possible future lawsuits when Sept. 11 victims’ families are asking for their day in court, particularly with the November election around the corner.

“The president understands the passion that is on both sides of this issue,” Earnest said, but added that he believes it would endanger troops, diplomats and intelligence personnel around the world.

Secretary of Defense Ash Carter also sent Thornberry a letter Monday warning of the impact if foreign countries in turn decided to limit sovereign immunity for the U.S. He said that could potentially expose Americans to lawsuits and “an intrusive discovery process” even if the U.S. is ultimately found not to be responsible for a particular event. Carter also noted there is a risk to U.S. assets, given the large amount of U.S. government property overseas, including military bases.

Future Changes

Several lawmakers said they hoped the legislation could be narrowed in the future.

Tennessee Republican Bob Corker, the Senate Foreign Relations chairman who has raised concerns about the bill, told reporters that he and other lawmakers are exploring the possibility of narrowing the bill’s application to just lawsuits arising from the Sept. 11 attacks.

But until Congress votes to override Obama’s veto, “it’s impossible to create any significant policy changes,” Corker said.

Once the bill becomes law, “we may have a better opportunity to soften this,” Corker told reporters. “You are going to see suits filed very quickly” against Saudi Arabia, and some other countries are likely to move quickly to expose the U.S. to lawsuits in their courts as well, Corker said. “We may be in a much better situation” to change the measure “after it goes into effect, after people see the impact of this legislation” he said.

That could happen in a lame-duck session or later.

South Carolina Republican Lindsey Graham told reporters he is also trying to pursue language “that would allow the 9/11 families to move forward with their claims but also be some preventive medicine.” Lawmakers “want to help the 9/11 families but there could be some real consequences to us as a nation if we don’t think this thing through. We don’t want to lose Saudi Arabia as an ally,” Graham said. Lawmakers are “thinking about making this more of a win-win,” he said.

Corker said last week the bill only passed the Senate on a voice vote the first time around because members didn’t think the House would take it up. But the House sent it to the president’s desk.

–With assistance from Roxana Tiron, Toluse Olorunnipa, Billy House, Stefania Bianchi, Archana Narayanan, Matthew Martin and Nafeesa Syeed. To contact the reporters on this story: Steven T. Dennis in Washington at sdennis17@bloomberg.net ;James Rowley in Washington at jarowley@bloomberg.net To contact the editors responsible for this story: Kevin Whitelaw at kwhitelaw@bloomberg.net John Voskuhl

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