Democrats rush to draft compromise auto bailout
WASHINGTON – Racing to seal a deal with the White House, Democratic congressional leaders dispatched aides Saturday to draft an emergency $15 billion aid package to pull Detroit’s Big Three automakers from the brink of collapse.
Capitol Hill leaders prepared to sell yet another bailout to a skeptical Congress. It is an uphill battle: The anger is fresh over how the Bush administration used the $700 billion Wall Street rescue fund and lawmakers are questioning whether the once-mighty auto giants can survive.
Still, with Washington spooked by massive job losses that provided the latest evidence of a deepening recession, the White House said it was in “constructive discussions” with lawmakers in both parties on the assistance. House and Senate Democratic staff aides worked through the weekend to hammer out details, with votes on the plan expected in the week ahead.
The emerging measure would speed short-term help to General Motors Corp., Ford Motor Co. and Chrysler LLC, while empowering the government to order a wholesale restructuring of the industry and imposing tight restrictions on the Big Three, according to congressional officials and others close to the talks.
It is designed to tide over the companies – particularly GM and Chrysler, which have warned that they are just weeks from going bust – through March, when Barack Obama is president and a new Congress could consider a longer-term solution.
A breakthrough on the long-stalled rescue came Friday when House Speaker Nancy Pelosi, D-Calif., yielded to President George W. Bush on a key point: allowing the aid to come from an existing fund set aside for the production of environmentally friendlier cars.
White House press secretary Dana Perino said that was central to any agreement, along with requirements that the carmakers swallow tough business decisions and taxpayers be protected.
© Copyright 2008 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.