Senate rejects auto industry bailout plan
December 31st, 1969
The U.S. Senate rejected an emergency bill to provide billions of dollars of aid to the Detroit 3 carmakers late on Thursday, dashing the hopes of General Motors and Chrysler, both of which may run out of cash by the end of the year.
"We have not been able to get this over the finish line," Senate Majority Leader Harry Reid said after 10 pm, following day-long negotiations to broker a deal among lawmakers, carmakers, unions and other interest groups.
Earlier this week the White House and Congress reached an agreement on most major points of the planned $14 billion rescue package, with only several final issues left to be decided, and yesterday the Democrat lead House of Representatives passed the bill, voting 237-170 in favor of it. However, the process came to a halt because of a dispute over when UAW workers would consent to have their wages reduced to match those paid to non-union workers in U.S. import-brand factories, reports Automotive News.
"We are three words away" from an agreement, said Sen. Bob Corker, R-Tenn., author of a GOP alternative. He said workers wouldn't accept a 2009 deadline for the parity demand.
The rescue package was aimed at propping up GM and Chrysler through March with low-interest loans, while Ford plans to hold-off taking any loans unless its financial situation worsens. The $14 billion was set to come from a fund previously established by the Energy Department earlier this year aimed at making American cars more fuel efficient.
The plan would have also seen a car czar appointed by the President to oversee restructuring programs and ensure that the carmakers follow through with changes that they have promised to the government in return for the loans. If they refused to follow the directions then further federal loans may be withheld or postponed.
Some options include a repeat vote when Congress comes back early next year with new legislation, or the Bush administration could choose to use some of the $700 billion rescue package, known now as Troubled Assets Relief Program, or TARP, funds, earmarked for financial markets. "Given the current weakened state of the U.S. economy, we will consider other options if necessary -- including use of the TARP program -- to prevent a collapse of troubled automakers," said White House spokeswoman Dana Perino in a written statement.
The U.S. Federal Reserve also has special authority to make emergency loans to almost any economically important entity that can't get credit elsewhere.
The pressure on the UAW to come further toward the bargaining table hasn't relented, however. "While the federal government may need to step in to prevent an immediate failure, the auto companies, their labor unions, and all other stakeholders must be prepared to make the meaningful concessions necessary to become viable," said Perino.
The U.S. Senate rejected an emergency bill to provide billions of dollars of aid to the Detroit 3 carmakers late on Thursday, dashing the hopes of General Motors and Chrysler, both of which may run out of cash by the end of the year.
"We have not been able to get this over the finish line," Senate Majority Leader Harry Reid said after 10 pm, following day-long negotiations to broker a deal among lawmakers, carmakers, unions and other interest groups.
Earlier this week the White House and Congress reached an agreement on most major points of the planned $14 billion rescue package, with only several final issues left to be decided, and yesterday the Democrat lead House of Representatives passed the bill, voting 237-170 in favor of it. However, the process came to a halt because of a dispute over when UAW workers would consent to have their wages reduced to match those paid to non-union workers in U.S. import-brand factories, reports Automotive News.
"We are three words away" from an agreement, said Sen. Bob Corker, R-Tenn., author of a GOP alternative. He said workers wouldn't accept a 2009 deadline for the parity demand.
The rescue package was aimed at propping up GM and Chrysler through March with low-interest loans, while Ford plans to hold-off taking any loans unless its financial situation worsens. The $14 billion was set to come from a fund previously established by the Energy Department earlier this year aimed at making American cars more fuel efficient.
The plan would have also seen a car czar appointed by the President to oversee restructuring programs and ensure that the carmakers follow through with changes that they have promised to the government in return for the loans. If they refused to follow the directions then further federal loans may be withheld or postponed.
Some options include a repeat vote when Congress comes back early next year with new legislation, or the Bush administration could choose to use some of the $700 billion rescue package, known now as Troubled Assets Relief Program, or TARP, funds, earmarked for financial markets. "Given the current weakened state of the U.S. economy, we will consider other options if necessary -- including use of the TARP program -- to prevent a collapse of troubled automakers," said White House spokeswoman Dana Perino in a written statement.
The U.S. Federal Reserve also has special authority to make emergency loans to almost any economically important entity that can't get credit elsewhere.
The pressure on the UAW to come further toward the bargaining table hasn't relented, however. "While the federal government may need to step in to prevent an immediate failure, the auto companies, their labor unions, and all other stakeholders must be prepared to make the meaningful concessions necessary to become viable," said Perino.
Senate rejects auto industry bailout plan
December 12th, 2008
Author
December 12th, 2008
Author
December 12th, 2008
- Articles Contributed: 3138
- Comments Posted: 0
- Leaderboard Rank: N/A
- 2624 Views
- 10 Comments
"We have not been able to get this over the finish line," Senate Majority Leader Harry Reid said after 10 pm, following day-long negotiations to broker a deal among lawmakers, carmakers, unions and other interest groups.
Earlier this week the White House and Congress reached an agreement on most major points of the planned $14 billion rescue package, with only several final issues left to be decided, and yesterday the Democrat lead House of Representatives passed the bill, voting 237-170 in favor of it. However, the process came to a halt because of a dispute over when UAW workers would consent to have their wages reduced to match those paid to non-union workers in U.S. import-brand factories, reports Automotive News.
"We are three words away" from an agreement, said Sen. Bob Corker, R-Tenn., author of a GOP alternative. He said workers wouldn't accept a 2009 deadline for the parity demand.
The rescue package was aimed at propping up GM and Chrysler through March with low-interest loans, while Ford plans to hold-off taking any loans unless its financial situation worsens. The $14 billion was set to come from a fund previously established by the Energy Department earlier this year aimed at making American cars more fuel efficient.
The plan would have also seen a car czar appointed by the President to oversee restructuring programs and ensure that the carmakers follow through with changes that they have promised to the government in return for the loans. If they refused to follow the directions then further federal loans may be withheld or postponed.
Some options include a repeat vote when Congress comes back early next year with new legislation, or the Bush administration could choose to use some of the $700 billion rescue package, known now as Troubled Assets Relief Program, or TARP, funds, earmarked for financial markets. "Given the current weakened state of the U.S. economy, we will consider other options if necessary -- including use of the TARP program -- to prevent a collapse of troubled automakers," said White House spokeswoman Dana Perino in a written statement.
The U.S. Federal Reserve also has special authority to make emergency loans to almost any economically important entity that can't get credit elsewhere.
The pressure on the UAW to come further toward the bargaining table hasn't relented, however. "While the federal government may need to step in to prevent an immediate failure, the auto companies, their labor unions, and all other stakeholders must be prepared to make the meaningful concessions necessary to become viable," said Perino.
More from MotorAuthority
-
11/06/2009
Opel Boss Carl-Peter Forster Calls It Quits
Carl-Peter Forster, GM group vice president and president of Opel, will be ...
-
11/06/2009
GM Czar Lutz Heading Back To Europe--To Opel?
GM's sudden decision this week to reverse path and keep Opel rather than ...
-
11/06/2009
Toyota To Put 2010 4Runner Through The Baja 1000 Wringer
Toyota's involvement in motorsports has been a hot topic this week with ...
More from High Gear Media
-
TheCarConnection.com | 11/07/2009
Driven: 2010 BMW ActiveHybrid X6
BMW's X6 "Sports Activity Coupe" is a car of contradictions. Our review ...
-
AllCarsElectric.com | 11/07/2009
Zero Motorcycles Announces Consumer Financing
I received the following in an email from Zero Motorcycles: "We are ...
-
AllCarsElectric.com | 11/07/2009
Electronics Supplier Denso Looks to Enter Hybrid and EV Battery Market
Denso, a Japanese automotive supplier, is aiming to enter the hybrid and ...
%7Cutmcsr%3D(direct)%7Cutmcmd%3D(none)%3B%2B__utmv%3D41864381.%3B)
Comments (10 total)
Meet the top commenters on the Leaderboardoh no... is it the USA.. or the USSR.. I CANT TELL!!! AHHHHHHHH...
oh wait.. bankers ARENT jumping out of their 100th floor office windows? no mushroom clouds over LA? hrm. weird.
i'd like to see how much money japan and germany have given their car companies over time to shut up all of the extremely stupid comments that are sure to follow.
Why should Cerberus not be held liable for the money if Chrysler folds? That's some bullshit if you ask me.
Great.
the govenrment is just dumping more money into a pot with no bottom man...
SS89,.. i will agree that cerberus should be liable..
but sprp... do you really think there is any way to get out of this situation without losing money? you'll need to invest in these companies to keep them alive and if they fall, the government will lose that money anyways. might as well keep a sense of national pride and some jobs if you're going to lose some money.. no?
look.. its a gamble.. you're going to casino and putting a wad of cash on black. but its better than just handing the wad of cash to the dealer and walking away right?
I agree that it's a gamble to be giving them any money at all, and there are risks but Cerberus has $25 Billion in assets. I mean, if you don't pay your mortgage, the bank doesn't just say oh well we tried and walk away, they take your house.
I guess if GM and Ford fail then there's no one left to pay the loans back, unless they sell off the factories and dealers and use that money to do so, which they should be expected to do. But if Chrysler fails, then mommy Cerberus is fully capable of paying back a few billion.
Maybe this is just how things work, but if it is then in my opinion things need to change.
This is not about saving jobs or businesses, this is about paying off the unions.
I suspect the UAW will come crawling back to the table for one very simple reason. Wall St. will have one incredibly bad day tomorrow so having no job and a pension plan thats now worthles due to a crash of the stock market is far worse than having to agree to a wage cut!!!!
We'll just have to wait and see.
In the mean time with so many people already out of work why dont the car companies just fire all union workers and hire those already looking for work. Reagan did just that with the airtraffic controllers in the 80's and all the history books I've read fail to report untrained new employee's crashing airliners into to each other.....
I agree with the sentiments expressed before. Why haven't we heard anything from the Unions. It is time for them to step up and earn their outrageous fees. Mere words cannot express the vitriol and bile with which I view these parasites. Suffice it to say, I hope they have brought their own eradication upon themselves with this latest action (ie, inaction in the current crisis).
Last paragraph - "Bust" administration . . .
The Unions strike again, what a bunch of morons. This is how you protect the livelihoods of your members? By forcing their employer out of business? MY GOD!
Forget about firing the CEOs of GM and such. These dumbasses running the UAW are the ones that need to get sacked. I can't even express in words how incredibly stupid I think these people are. Your representing factory workers whose wages have always been high, it's time to come back to the real world and suck it up.
Post a Comment
Sign In |