Congressional Backers Urge Help For Big 3
WASHINGTON — Congressional backers of $25 billion in emergency loans to the U.S. auto industry are urging colleagues not to punish Detroit’s Big Three for past mistakes.
2009 Autos | Survey
House Financial Services Committee Chairman Barney Frank also said there seems to be a congressional bias in agreeing to help white-collar bankers but not blue-collar auto workers.
But Alabama Republican Spencer Bacchus said the bailout would only “push the problem further down the path.” 
The top Senate Banking Committee Republican said nothing will turn around the troubled U.S. auto industry until its top management is ousted and the manufacturing model overhauled.
Sen. Richard Shelby of Alabama said Wednesday that he didn’t think providing $25 billion in emergency loans to Detroit would do the jobs, calling that a “life support” option.
Shelby said on CBS’s “The Early Show” that he believes filing for bankruptcy might be the better choice.
Frank said he didn’t think filing for bankruptcy would be a good strategy.
He noted that such a move would likely mean that contracts with organized labor would have to be broken.
The rescue plan appears stalled on Capitol Hill, even as the CEOs of General Motors, Ford and Chrysler press their case before the House Financial Services panel. On Tuesday, they made their pitch to a Senate committee.
On the Senate side, the Democratic leader is lowering expectations for the bailout. Sen. Harry Reid said he hopes Congress can agree on a $25 billion bill.
But if not, he said, it will be up to the Bush administration to save the carmakers from collapse.
A Senate vote could come as soon as Thursday.
Auto executives told a Senate panel Tuesday and were expected to tell the House committee Wednesday that if their companies fail, other businesses will also be pulled under, resulting in the loss of millions of jobs.
The CEOs said the $25 billion in loans they’re pushing for is much less than the overall cost if they go bankrupt.
A proposal to slice the $25 billion from the $700 billion Wall Street rescue package appears to be going nowhere in the Senate.
But lawmakers from states heavily impacted by the auto industry are working behind the scenes on a compromise that could speed some aid to the automakers before year’s end.
The White House said the auto industry should tap a loan program created to help it make more fuel-efficient vehicles.
Previous Stories:
- November 18, 2008: Big 3 Execs Begging For Federal Cash
- November 17, 2008: Administration Wants Big 3 ‘To Succeed’
- November 16, 2008: Auto Bailout May Have To Wait
- November 15, 2008: Auto Bailout Backers Offer To Cut $25B Size
- November 14, 2008: Bush Wants $25B In Loans Released To Carmakers