I'm going to try to get this content as fresh as I can but this is still a developing story as I write this...
A staffer source said that the California Exemption was removed from the Senate version of the bill. So now everybody will be looking at Nancy Pelosi to see what she will do. Clearly that provision was a big deal breaker for a lot of folks as it would have destroyed the very industry that the bailout was trying to save. Throughout the day, I had been hearing that a deal had been reached...but I've been hearing variants of that story for days and none of them have panned out. Upon having a finalized bill for the Senate, our senior senator had this to say:“My understanding is that we’re one step closer to giving a lifeline to millions of hard-working Americans who are worried about their jobs and providing for their families. While I am still studying the legislation, it appears that my Senate colleagues agree with my concerns regarding crippling environmental standards as well as providing strong protections for taxpayers and have moved to address those concerns. This relief is in the form of bridge loans that have to be paid back. The funding to support these loans has already been appropriated – this is not additional spending. If this compromise holds true, I will vote for this bill when it comes to the floor. We must act, and act quickly. This is not the time for political grandstanding. Time is running out for our economy. Unfortunately, some of my colleagues in the Senate do not understand how fragile things are and the anxiety other Americans are experiencing.”
I really hate the idea of an Auto Bailout, but if we have to have one I think the bill ought to be as "good" as it possibly can be... Is this the "best" we're going to see? A source also indicated that the role of the "car czar" wasn't as bad in this new version of the Senate bill. Me? I think any car czar is a bad idea. The last thing the industry needs is some bureaucrat designing our cars... Again: These are the same great minds that run the IRS and DMV... About this time, the House Republicans got in the act and proposed the No Bailout Alternative. Republican Leader, my Congressman and a Great American -- John Boehner -- had this to say:“The proposal put forth by our colleagues in the Democratic majority is unworthy of American auto workers and unworthy of American taxpayers. It guarantees failure at taxpayer expense. It will keep the industry dependent on taxpayer money instead of giving auto workers the security of a viable industry that is back on its feet and ready to compete. American auto workers and taxpayers deserve better.
“A responsible plan should protect taxpayers and help auto workers and their families by allowing the Big Three to become competitive again. Our plan does this.”
You can check out the plan here. The latest news is that the Auto Bailout is in trouble in the Senate due to a Republican revolt. And I say "Praise Jesus!" Rep. Bob Latta:“The auto industry is a critical segment of our nation’s economy, especially in Ohio. During the testimony from the “Detroit 3” and the drafting of this legislation, important questions remain unanswered that put the American taxpayer at serious risk.
Similar to the financial bailout, Congress is putting one person in charge of an entire area of our economy. We cannot in good faith give one person management power over the “Detroit 3” if they cannot currently manage themselves. This bill yields vast power in the “car czar” to decide what types of vehicles Americans will drive, how corporate organizations and debt will be restructured, and whether or not the companies are meeting the criteria of the bailout. This bill also fails to address what will happen to the companies should they not be in compliance with the bailout, as Congress will immediately demand repayment. It is clear each company currently does not possess the cash to operate at this time. How will they repay the loan in the near future if they cannot meet the requirements set forth in the bill? In addition, this legislation was nothing more than a short-term bridge loan to the “Detroit 3” with no guarantee they would not return in the near future for additional funding.
House Republican leadership laid out an alternative plan earlier today, mapping out a plan of faster restructuring with harder deadlines for the “Detroit 3” to meet. Additionally, the plan calls for each of the companies’ creditors to drastically reduce their respective indebtedness by at least 1/3. Most importantly, the House Republican plan is financed with government insurance, similar to fee-based programs like the FDIC, which provides much needed protection for this taxpayer investment.
Furthermore, the current proposal was introduced by Democrat leadership today and was fast tracked through normal proceedings, bypassing hearings and extensive debate. Members had less than ten hours to review the bill before voting.
Securing the nation’s auto industry is a serious concern that needs review and careful attention. This bill fails to provide accountability on American taxpayers’ investments, security to the millions employed by the automotive industry, and does not guarantee any solid restructuring plans for any of the “Detroit 3”. Under the bill, the risk behind this investment is too great for the American taxpayer.
Because of the reasons set forth above, I had to cast a no vote. Once again, too much power is vested in one individual with too much discretion on where America’s automotive future will be.”
Rep. Jean Schmidt:“The auto industry is vitally important to the United States and the Second Congressional District; however, I believe there is a better path to reform that does not put taxpayer dollars at risk. Therefore I could not support the measure considered today by the House of Representatives.”
My fear: Remember when the first Mother of All Bailouts failed. That's looking like a pretty good deal when you compare it to what eventually passed...
