Osborne has no guarantee that his loan subsidies will be taken up.

In February, President Bush sided with the Democrats when he called for a sharp reduction of federal loan subsidies.

But the decision not to proceed with applications for loan subsidies from American companies could be a substantial roadblock to these companies ambitions, though it is not likely to affect progress on the dam itself.

A study in 1995 by the Congressional Budget Office concluded that the Government spends $28 billion a year promoting commerce and business and another $2.2 billion in loan subsidies.

The Clean Trucks Program calls for drayage truck owners to scrap and replace old, polluting trucks working at the Port, with the assistance of a port-sponsored grant or loan subsidy.

They settled on an aid package for Los Angeles and more than 75 other cities with $1.3 billion in grants, loans and loan subsidies, and both the House and Senate quickly passed the compromise.

The Administration has aggressively used Government tax breaks and loan subsidies to encourage investment by American corporations in developing countries, but it has never focused similar efforts in a systematic way on struggling communities in the United States.

Bruce Cuthbertson, a spokesman for Representative John R. Kasich, the Ohio Republican who chairs the House Budget Committee, said of loan subsidies, "We think it's a matter of fairness.

The airlines and their unions are floating proposals ranging from loan subsidies to tax breaks to a get-tough policy on foreign competitors.

The House will vote again soon on whether to eliminate loan subsidies that keep sugar prices high while fostering destruction of the Florida Everglades.