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US Congress nears vote on auto bailout plan
2008-12-10
WASHINGTON (AFP) - Democratic congressional leaders said they had reached a deal in principle with the White House on a 15-billion-dollar rescue for the ailing automotive industry that could be ready for a vote Wednesday but many Republican lawmakers remained skeptical of the bailout. Even as details of the plan were still being hammered out, Democratic party leaders reportedly worked to rally support for a possible vote on the package in the House of Representatives as soon as Wednesday afternoon. Senator Carl Levin from Michigan, the base for the auto industry, said he understands that an "agreement has been reached," and that it was only a matter of time before a bill was ready for a vote. "This gets us to the 20 yard line, but getting over the goal line will take a major effort," he said. But the White House said there was no final agreement on the deal as Republicans in Congress voiced objections. "We will continue to work with Congress to finalize legislation the president can support," said White House spokeswoman Dana Perino. She said "a great deal of progress has been made" on the legislation to shore up the ailing Detroit Big Three -- General Motors, Ford and Chrysler . In the most far-reaching intervention in US industry in years, the tentative deal calls for emergency government loans to the car companies within days to be overseen by a "car czar" appointed by President George W. Bush. In return, the automakers by March 31 would have to cut costs, settle debts and make other changes to show a path to viability or otherwise face possible bankruptcy. The government could choose to revoke the loans if the companies failed to make progress, or could refuse further assistance after March 31 if there was no realistic survival plan for the Big Three, officials said. A senior administration official said the main concern for the White House was certifying the companies can prove they are "viable" and that taxpayers would not foot the bill for a fresh round of loans in coming months. But there remained unresolved disputes with the White House over details of the bill, including a provision supported by Democrats that would ban the automakers from joining lawsuits challenging limits on greenhouse gas emissions in some US states. Many of Bush's fellow Republicans in Congress were reluctant to back the bailout, with opposition running strong in the Senate where Democrats have a narrow majority. Republican Senator John Ensign threatened to use senate rules to delay a vote until next week. "Unless major changes are made that I can be convinced of, it would take a lot for me to move off where I am," Ensign said. The proposed short-term loans of 15 billion dollars (11.6 billion euros) are meant to sustain the car giants through March, allowing president-elect Barack Obama time to address their crisis after he takes office on January 20. Obama has called a collapse of the auto industry "unacceptable," but said Sunday he wanted a supervisory process that would hold the companies' "feet to the fire." GM and Chrysler are first in line after warning they are fast running out of cash. Ford, though equally hampered by slumping sales, says it faces no immediate liquidity crisis but wants a nine-billion-dollar line of credit. While the Democratic-led Congress was ready to extend a larger amount of aid, the Bush administration has balked at giving any more than 15 billion dollars and insists -- like Obama -- that the automakers must retool for the long haul. The auto giants had initially asked for more than twice as much -- 34 billion dollars -- to stave off a "catastrophic collapse." House of Representatives Speaker Nancy Pelosi said the automakers must be "preserved" as it was "essential to our national security that we have a strong industrial and manufacturing base." But government help must not amount to "corporate welfare," she told reporters, mentioning former Federal Reserve chairman Paul Volcker as a possible presidential czar to supervise the companies' restructuring. The bill also requires the automakers to sell their private jets and places strict limits on executive compensation, similar to a recent bailout for financial firms buffeted by the global credit crunch and toxic mortgage loans.
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