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MotorCity · 11-20-08, 11:58

Bailout compromise plan put on ice, but hope remains

Harry Stoffer
Automotive News
November 20, 2008 - 12:48 pm ET
UPDATED: 11/20/08 2:50 p.m. EST

WASHINGTON -- Democratic leaders of Congress today rejected a proposed bipartisan compromise that would have provided $25 billion in emergency federal aid to the Detroit 3.

Sens. Carl Levin and Debbie Stabenow, both Michigan Democrats, announced this afternoon that they were signing onto a Republican proposal to redirect $25 billion in loans aimed at helping automakers build more fuel-efficient vehicles. Instead, those funds would provide bridge loans to the Detroit 3 to help them address fiscal crises.

But before a news conference announcing that compromise, House Speaker Nancy Pelosi, D-Calif., Senate Majority Leader Harry Reid, D-Nev., and seven other Democratic leaders entered the room in which the event was to be held. They said they did not support the proposal.

"It's their agreement," Reid said of the compromise's supporters.

During an afternoon news conference, Levin and other compromise supporters said they were pleased with developing a bipartisan plan and said they still were hopeful a deal could be completed in December.

Democratic leaders support carving out $25 billion in loans to the Detroit 3 from the $700 billion federal bailout fund for financial institutions. President George W. Bush and GOP lawmakers have rejected that approach.

Reid said the CEOs of the Detroit 3, who testified before House and Senate committees this week, did not convince Congress that their companies could be made viable with additional aid.

He said he would ask the automakers to submit plans by Dec. 2 detailing how they would use more federal money. Reid said he would look for "accountability and viability."

Added Pelosi: "Until they show us a plan, we can't show them the money."

The Senate Banking Committee and House Financial Services Committee, which held this week's hearings, would hold further hearings the week of Dec. 8 to consider the Detroit 3 plans, Reid said. After that, he said, the full House and Senate could consider further aid legislation.

While Pelosi also expressed doubt that further federal aid would make the Detroit 3 viable, she rejected suggestions that the companies should file for bankruptcy protection.

11-20-08, 11:58	#173 (permalink)
MotorCity Deep Gloss Auto Salon MotorCity is offline Join Date: Jun 2007 Location: Michigan Posts: 1,340	Re: Should the government bail-out include domestic automakers? Bailout compromise plan put on ice, but hope remains Harry Stoffer Automotive News November 20, 2008 - 12:48 pm ET UPDATED: 11/20/08 2:50 p.m. EST WASHINGTON -- Democratic leaders of Congress today rejected a proposed bipartisan compromise that would have provided $25 billion in emergency federal aid to the Detroit 3. Sens. Carl Levin and Debbie Stabenow, both Michigan Democrats, announced this afternoon that they were signing onto a Republican proposal to redirect $25 billion in loans aimed at helping automakers build more fuel-efficient vehicles. Instead, those funds would provide bridge loans to the Detroit 3 to help them address fiscal crises. But before a news conference announcing that compromise, House Speaker Nancy Pelosi, D-Calif., Senate Majority Leader Harry Reid, D-Nev., and seven other Democratic leaders entered the room in which the event was to be held. They said they did not support the proposal. "It's their agreement," Reid said of the compromise's supporters. During an afternoon news conference, Levin and other compromise supporters said they were pleased with developing a bipartisan plan and said they still were hopeful a deal could be completed in December. Democratic leaders support carving out $25 billion in loans to the Detroit 3 from the $700 billion federal bailout fund for financial institutions. President George W. Bush and GOP lawmakers have rejected that approach. Reid said the CEOs of the Detroit 3, who testified before House and Senate committees this week, did not convince Congress that their companies could be made viable with additional aid. He said he would ask the automakers to submit plans by Dec. 2 detailing how they would use more federal money. Reid said he would look for "accountability and viability." Added Pelosi: "Until they show us a plan, we can't show them the money." The Senate Banking Committee and House Financial Services Committee, which held this week's hearings, would hold further hearings the week of Dec. 8 to consider the Detroit 3 plans, Reid said. After that, he said, the full House and Senate could consider further aid legislation. While Pelosi also expressed doubt that further federal aid would make the Detroit 3 viable, she rejected suggestions that the companies should file for bankruptcy protection.