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Battle mounting in Senate over $14 billion deal
By Julie Hirschfeld Davis
Associated Press
Published on Thursday, Dec 11, 2008
WASHINGTON: A $14 billion rescue package for the nation's imperiled auto industry sped to approval in the House on Wednesday night, but the emergency bailout was still in jeopardy from Republicans who were setting out roadblocks in the Senate.
Democrats and the Bush White House hoped for a Senate vote as early as today and enactment by week's end. They argued that the loans authorized by the measure were needed to stave off disaster for the auto industry — and a crushing further blow to the reeling national economy.
The legislation, approved 237-170 by the House, would provide money within days to cash-starved General Motors Corp. and Chrysler LLC. Ford Motor Co., which has said it has enough to stay afloat, would also be eligible for federal aid.
Reps. Steven LaTourette, R-Concord Township; Ralph Regula, R-Navarre; Tim Ryan, D-Niles, and Betty Sutton, D-Copley Township, voted in favor of the bill.
Republicans were preparing a strong fight against the aid plan in the Senate, not only taking on the Democrats, but also standing in open revolt against their party's lame-duck president on the measure.
The Republicans want to force the companies into bankruptcy or mandate hefty concessions from autoworkers and creditors as a condition of any federal aid. They also oppose an environmental
mandate that House Democrats insisted on including in the measure.
House Speaker Nancy Pelosi said the House-passed bill represented ''tough love'' for U.S. auto companies and ''giving a chance — this one more chance — to this great industry.''
The White House, struggling to sell the package to congressional Republicans, said earlier that a carmaker bankruptcy could be fatal to the auto industry and have a devastating impact on workers, families and the economy.
''We believe the legislation developed in recent days is an effective and responsible approach to deal with troubled automakers and ensure the necessary restructuring occurs,'' said Dana Perino, the White House press secretary.
But the measure faces a difficult road in the Senate, where it needs 60 votes to advance. Rank-and-file Senate Republicans skewered the bill during a closed-door luncheon with White House Chief of Staff Josh Bolten, who was dispatched to Capitol Hill to make a case for the rescue package.
Behind the scenes
Besides providing cash for the auto companies, the package would create a government ''car czar,'' to be named by President George W. Bush to dole out the loans, with the power to take back the money and force the carmakers into bankruptcy next spring if they didn't cut quick deals with labor unions, creditors and others to restructure their businesses and become viable.
''To give up on the auto industry now would be to condemn the American economy at one of its most vulnerable periods in our economic history to a degree of further hurt,'' said Rep. Barney Frank, D-Mass, the Financial Services Committee chairman.
Behind the scenes, Senate Democratic and Republican leaders scrambled for a deal that would allow votes on the bill today.
Some GOP senators were demanding votes on an alternative that would order the automakers to take specific actions to restructure — including steep wage cuts and debt restructuring — in return for any federal money.
Opposition from Republicans reflected the tricky task of pushing yet another federal rescue through a bailout-weary Congress, with Bush's influence on the wane.
''People realize that this bill is an incredibly weak bill [and] is the product of an administration that wants to kick the can down the road and let somebody else deal with it,'' said Sen. Bob Corker, R-Tenn.
The auto-aid debate was replete with echoes of the tense, early October drama surrounding the $700 billion Wall Street bailout, when a marathon set of negotiations yielded a much-celebrated deal that came apart quickly amid GOP opposition and public outrage. That bill ultimately passed after much arguing, cajoling, threatening and lobbying among lawmakers, and Bush signed it.
New requirements
Before passing the auto measure Wednesday, the House voted to add language requiring that banks that are bailed out by the government report quarterly on how much they have increased or decreased lending.
In the Senate, opposition to the auto rescue wasn't limited to Republicans.
Democratic Sen. Max Baucus of Montana announced he was against the measure because of a provision to bail out transit agencies that were involved in transactions that are now considered unlawful tax shelters.
House Republicans swiftly voiced their opposition and called for a plan that would instead provide government insurance to subsidize new private investment in the Big Three automakers, demand major labor givebacks and debt restructuring at the companies and encourage them to declare bankruptcy.
Under the House-passed measure, the carmakers would have to submit blueprints on March 31 to the industry overseer showing how they would restructure to ensure their survival, although they could be given until the end of May to negotiate with the government on a final agreement.
WASHINGTON: A $14 billion rescue package for the nation's imperiled auto industry sped to approval in the House on Wednesday night, but the emergency bailout was still in jeopardy from Republicans who were setting out roadblocks in the Senate.
Get the full article here.
Comments
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Posted 06:47 AM, 12/11/2008
By this vote the House has doomed the economy to a hastened and deeper dive. And along with it the above listed so-called lawmakers have slit their political wrists.
akron, OH
Posted 08:20 AM, 12/11/2008
i have no comment
