Oracle of Delphi

Automaker aid bill doesn’t have needed votes

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WASHINGTON - Senate Majority Leader Harry Reid says the Democrats’ plan to tap the Wall Street rescue fund to save U.S. automakers doesn’t have the votes to pass.

One day after Detroit’s Big Three sent survival plans to Capitol Hill in an urgent plea for $34 billion in government aid, Reid said there’s still not enough support in Congress for using some of the $700 billion bailout to help the teetering carmakers.

He told The Associated Press in an interview, “I just don’t think we have the votes to do that now.”

The Bush administration and auto-state Republicans and Democrats are pushing instead to take a $25 billion program to help the carmakers produce green vehicles and convert that into emergency loans.

Automakers and their union worked feverishly Wednesday to sell a skeptical Congress on a $34 billion aid plan, promising labor concessions and restructuring in advance of a second round of hearings.

In Capitol Hill meetings, industry officials said the collapse of one or more of the Big Three carmakers could deepen the recession and undermine the companies’ ability to survive.

“We’re on the brink with the U.S. auto manufacturing industry. We’re down to months left,” Chrysler’s vice chairman, Jim Press, told The Associated Press in an interview. “If we have a catastrophic failure of one of these car companies, in this tender environment for the economy, it’s a huge blow. It could trigger a depression.”

Video

Chrysler exec on autos crisis

Dec. 3: Chrysler’s Press: ‘If one of the automakers goes down, the rest go with it.’

CNBC

GM’s president and chief operating officer, Fritz Henderson, who met with congressional aides, said choosing the bankruptcy route would further erode consumer confidence in his company. About 25 auto dealers also combed through the House and Senate office buildings surrounding the Capitol, lobbying for the bailout package.

The UAW, scrambling to preserve jobs and benefits, agreed at an emergency meeting in Detroit to delay the companies’ payments to a multibillion-dollar, union-run health care trust and scale back a jobs bank in which laid-off workers are paid most of their wage. The concessions could help soothe some lawmakers who had criticized the union’s benefits as too rich when compared with those of workers at foreign-brand auto plants in the U.S..

“It should be helpful. It’s additional evidence that the UAW’s willing to participate in the painful restructuring,” said Sen. Carl Levin, D-Mich., a top supporter of the industry.

GM and Chrysler said they needed an immediate infusion of government cash to last until New Year’s, and both said they could drag the entire industry down if they fail. Ford wants a $9 billion “standby line of credit” in case a competitor fails.

Chrysler said it needed $7 billion by year’s end to keep operating. GM asked for an immediate $4 billion as the first installment of a $12 billion loan, plus a $6 billion line of credit to use if conditions worsen.

Ford’s chief executive, Alan Mulally, and GM’s chief executive, Rick Wagoner, said they would work for $1 a year if each company accepted government loans. The carmakers also have offered to cancel bonuses and merit raises. Chrysler said its chief executive has cut his annual pay to $1.

All three plans envision the government getting a stake in the companies that would allow taxpayers to share in future gains if they recover.

The Senate Banking, Housing and Urban Affairs Committee was to hear testimony Thursday from the executives, the UAW’s president, Ron Gettelfinger, and the head of the Government Accountability Office on the companies’ plans. The House Financial Services Committee planned similar session Friday.

Officials at the White House and the Treasury and Commerce departments were scouring the plans. White House press secretary Dana Perino said it was “too early to say” whether the companies have outlined a path toward viability that justifies new federal assistance.

President-elect Barack Obama said it appeared that Big Three chiefs were returning to Washington with a “more serious set of plans.”

The bailout faces a skeptical public. Sixty-one percent oppose providing the auto companies with billions in federal assistance, according to a CNN-Opinion Research Corp. poll released Wednesday. Fifty-three percent said it would not help the economy.

Few saw any quick impact if the U.S. auto industry were to go bankrupt — only one in three said it would affect them immediately or in a year. Most of the rest said they thought it would affect them eventually, though nearly one-quarter said they would never feel its impact.

Earlier Wednesday, GM's Henderson said that bankruptcy isn’t a viable option because it would further erode consumer confidence in the automaker and “we want them to be confident in their ability to buy our cars and trucks.”

Henderson appeared on the network morning news as leaders of the UAW was immersed in intense discussions on possible givebacks for the companies at an emergency meeting in Detroit.

Henderson said that GM is ready to undertake a host of steps needed to resize. But he also said on NBC television that "to win, you've got to win with product and technology. ... And we do not want to give consumers a reason not to buy our cars and trucks."

Chrysler LLC and Ford Motor Co. — as well as GM — have ditched their corporate jets for hybrid cars and replaced vague pleas for federal help with detailed requests for as much as $34 billion in their second crack at persuading Congress to throw them a lifeline.

Henderson acknowledged Wednesday that the initial appearance by the heads of the car makers was a public relations failure.

"Yeah, it certainly was not our finest hour," he told NBC. "We were not as clear about what we wanted to do." He also conceded that the decision by the executives to travel to Washington by private jet "was a problem" for lawmakers.

Link: http://www.msnbc.msn.com/id/28030726/

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Sounds like this has become a political football, with Congress and the Administration both wanting the other to do the job.

F'ing jackasses!

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*scoff*

As if the Paulson or the Fed needed congressional approval to hand out money......

Paulson is just taking care of his friends back at Goldman Sachs. He doesn't care about the automakers or else they would have gotten the check already.

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I think if anybody cares any more about the US auto industry, you better get on the phone to your congressional representatives and make your feelings known. Clearly there is a great deal of apathy out there at the moment.

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The hypocrisy of this whole Congressional circus is infuriating.

I think we should make CONGRESS work for $1 a year until they fix this broken economy! It was them that got us into this mess by turning a cheek toward the shenanigans in the finance industry!

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The hypocrisy of this whole Congressional circus is infuriating.

I think we should make CONGRESS work for $1 a year until they fix this broken economy! It was them that got us into this mess by turning a cheek toward the shenanigans in the finance industry!

A fine idea!

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A fine idea!

I think so too. Does nay one know if there is a list of which representatives support or reject which proposal. The idea to use the "CAFE" money instead of Wall Street money obviously means less total.

Just venting, but it would be an interesting show of force if the UAW workers started the unemployment compensation paperwork in mass numbers.

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Just venting, but it would be an interesting show of force if the UAW workers started the unemployment compensation paperwork in mass numbers.

You need to post that often and all over

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48 days...assuming the automakers can last that long

Ford can, GM and Chrysler can't. I'd rather see Chrysler fail, that opens up market space for GM and Ford. Otherwise let Cerebus pump money from something else they own into Chrysler. Cerebus is the one that wanted it, let them pay for it.

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Ford can, GM and Chrysler can't. I'd rather see Chrysler fail, that opens up market space for GM and Ford. Otherwise let Cerebus pump money from something else they own into Chrysler. Cerebus is the one that wanted it, let them pay for it.

I have seen a number of "experts" on TV and they all say GM and Ford have future products, but few see Chrysler making it through this "sh*t storm".

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Chrysler is all about the EVs, because buyers have always flocked to fully electric cars that need to be recharged after 200 miles.

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I have seen a number of "experts" on TV and they all say GM and Ford have future products, but few see Chrysler making it through this "sh*t storm".

That would be a damn shame.

I had this notion that Congress will force GM or Ford to absorb Chrysler if they want the loan.

Seems like everything is some backroom/backhanded deal these days.

Makes me sick.

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Can't say I am suprised Ford is sitting the best money wise, product wise it would be GM by far. I can see both sides, I really don't care what way they go if chapter 11 is better for them go for it. They will come back they must come back. Chrysler doesn't have the products or the money they are the big loser. Sorry to say but the Sebring, Caliber and PT Cruiser aren't going to cut it. GM if they restructed under chapter 11 might have more power to be more competitive quicker. GM has a Cruze, Volt, LaCrosse, refreshed G6, G3, G8 GXP, G8 ST, Solstice Coupe, Camaro, Equinox, and Terrain all coming down the pike soon what does Chrysler have? Ford has the new Fusion/Milan and Hybrid verisons and the Mustang. Chrysler hasn't got jack... I would be sad to see anyone go but it will prolly be Chrysler. :angry:

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I think if anybody cares any more about the US auto industry, you better get on the phone to your congressional representatives and make your feelings known. Clearly there is a great deal of apathy out there at the moment.

I'll support a bailout of GM if the company agrees to build affordable, reliable small cars with dent resistant plastic panels at its plant in Spring Hill, TN! :)

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What will have to happen is some 'dominoes' will have to fall, and then the nay-sayers will maybe get a f-in clue. Unemployed workers should move to 'import friendly' states [AL, TN, SC, GA, MS] and apply for welfare, since they supposedly have so much $$$ to give to MB, Beemer, Toyo, Nissan, VW, and Kia/Hyundai.

Edited by Chicagoland
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you know, with the import brands seeing huge drops too last month, you'd think at some point people would see how much of a storm this is becoming.

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you know, with the import brands seeing huge drops too last month, you'd think at some point people would see how much of a storm this is becoming.

I just read of another new bailout. However, again the auto industry is left out. The proposal is the feds issue 3% bonds to investors and turn around and off 4% mortgages to consumers. This would stimulate the housing market which in turn would stimulate the economy. This isn't too bad of an idea but once again the auto industry is left out. I wonder if auto loans were included in the proposal, and if the southern state manufacturers were included too, if there might not be enough political support to get at least that much help.

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I just read of another new bailout. However, again the auto industry is left out. The proposal is the feds issue 3% bonds to investors and turn around and off 4% mortgages to consumers. This would stimulate the housing market which in turn would stimulate the economy. This isn't too bad of an idea but once again the auto industry is left out. I wonder if auto loans were included in the proposal, and if the southern state manufacturers were included too, if there might not be enough political support to get at least that much help.

Whoever thought of that gets an "F" for understanding the problem.

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WASHINGTON - Senate Majority Leader Harry Reid says the Democrats’ plan to tap the Wall Street rescue fund to save U.S. automakers doesn’t have the votes to pass.

One day after Detroit’s Big Three sent survival plans to Capitol Hill in an urgent plea for $34 billion in government aid, Reid said there’s still not enough support in Congress for using some of the $700 billion bailout to help the teetering carmakers.

He told The Associated Press in an interview, “I just don’t think we have the votes to do that now.”

Once again, it's all about votes....

The american car market is divided right down the middle import vs. domestic. The population is divided about a bailout as well. So, instead of doing the right thing, and becoming the leaders that this country needs, the government would rather do what gets them the most votes so that they can maintain power.

No surprises here...

“We’re on the brink with the U.S. auto manufacturing industry. We’re down to months left,” Chrysler’s vice chairman, Jim Press, told The Associated Press in an interview. “If we have a catastrophic failure of one of these car companies, in this tender environment for the economy, it’s a huge blow. It could trigger a depression.”

Doesn't matter.... It's all about maintaining votes. The fact that the population is too stupid to realize what implications a collapse of Detroit will have is a moot point so long as that same public keeps re-electing the representatives.

Besides, I'm sure non of these idiots even read the plans anyway.

The bailout faces a skeptical public. Sixty-one percent oppose providing the auto companies with billions in federal assistance, according to a CNN-Opinion Research Corp. poll released Wednesday.

Proving that the media is highly effective at swaying the public.

Fifty-three percent said it would not help the economy.

Proving that at least 53% of the population hasn't got a clue.

Henderson acknowledged Wednesday that the initial appearance by the heads of the car makers was a public relations failure.

Ya think? Maybe you guys should've ACTUALLY prepared for it or ACTUALLY expected the TYPICAL media response...

NOTICE: Since the plans went public, there has been virtually NO detailed reporting on them. Instead, the media wants to continue the negativity and opinion swaying by running what are basically EDITORIAL opinion pieces.

I say f@#k IT... Take 'em bankrupt and hopefully it'll be like a 'foot to the throat' of this economy. I'm already poverty level, so I couldn't give three sh*ts about the economy, in general.

Edited by FUTURE_OF_GM
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^ Well, if it all falls through, we will be cemented in a long hard recession/depression. Bennett buggy's anybody?

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NOTICE: Since the plans went public, there has been virtually NO detailed reporting on them. Instead, the media wants to continue the negativity and opinion swaying by running what are basically EDITORIAL opinion pieces.

Good point!

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I am willing to bet most commentators didnt read the plans. Shows how bad attention spans are and all that matters is ratings, huge headlines and drama.

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