GOP May Scuttle Auto Bailout
The auto industry bailout looks to be in trouble again.
WASHINGTON (AP) – Emergency aid for the nation’s imperiled auto industry was thrown into jeopardy Wednesday, opposed by Republicans who were revolting against a hard-fought deal between Democrats and the Bush White House to speed $14 billion to ailing carmakers.
Democrats detailed the compromise measure and laid the groundwork for quick votes on it, holding out hope the bailout could be enacted by week’s end. But a growing number of GOP senators declared they would not go along.
The White House, though not formally endorsing an agreement with congressional Democrats, dispatched administration officials to Capitol Hill to make a case for the rescue package. During a contentious, closed-door luncheon with Senate Republicans, they got an earful of criticism from the rank-and-file, some of whom have already announced plans to block the measure.
The plan would create a government “car czar,” to be named by President George W. Bush to dole out the loans, with the power to 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.
Congressional Republicans, left out of negotiations on the package, blasted it. Their opposition reflected the tricky task of enacting yet another federal rescue in a bailout-weary Congress, with Bush’s influence on the wane.
I think this is probably a good thing. After all, part of the deal includes possibly forcing the car companies into bankruptcy. Why wait. If these companies are in that much trouble and they just can’t cut in the market, then bankruptcy is for them. They will get reorganized, renegotiate with their creditors, and cut new deals with labor unions, etc. And they’ll do all of this without having to grab a bunch of tax payers dollars.