White House promises new last-ditch auto rescue

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WASHINGTON — With Congress gridlocked and the economy floundering, the Bush administration declared Friday it would step in and prevent the "precipitous collapse" of the U.S. auto industry and the disastrous national economic impact of the hundreds of thousands of job losses sure to follow.

The day after the sudden demise of emergency legislation in Congress, administration officials said no decisions had been made on the size or duration of the new rescue plan, or what type of concessions, if any, would be demanded from the struggling automakers, their workers, stockholders or others.

In a reversal, the most likely option under consideration involved billions of dollars originally ticketed for the bailout of the financial industry. President George W. Bush had long declared that money off-limits to the beleaguered automakers.

General Motors Corp. and Chrysler LLC have warned they are running out of cash and face bankruptcy without some form of assistance. Ford Motor Co., which is in somewhat better shape financially, has been seeking access to a line of credit.

Urgent requests for White House intervention to save the automakers came from President-elect Barack Obama, Republican and Democratic members of Congress and outside groups.

"Under normal economic conditions we would prefer that markets determine the ultimate fate of private firms," White House press secretary Dana Perino said after the failure of a $14 billion bailout bill in Congress. The legislation died when Senate Republicans demanded upfront pay and benefit concessions from the United Auto Workers that union officials rejected.

Perino added, "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. A precipitous collapse of this industry would have a severe impact on our economy, and it would be irresponsible to further weaken and destabilize our economy at this time."

TARP is the $700 billion Troubled Assets Recovery Program, the financial industry bailout plan enacted in October. All but $15 billion of the first $350 billion has been dedicated to troubled banks or insurance companies, and the Treasury Department is barred from dipping into the second $350 billion without a formal notification of Congress.

No decision has been reached about such a notification, administration officials said. If one is made, Congress could then vote to prevent the action, but it would be unlikely to prevail in a showdown with the president.

Obama, who will inherit the problem next month, even if bailout billions are handed over in the meantime, said, "My hope is that the administration and the Congress will still find a way to give the industry the temporary assistance it needs while demanding the long-term restructuring that is absolutely required."

In a letter to Bush, House Speaker Nancy Pelosi urged the president to demand "the same tough accountability" and taxpayer protections from the automakers as was contained in legislation that cleared the House at midweek.

Michigan Rep. Thaddeus McCotter, a conservative Republican from a state where Ford, GM and Chrysler are headquartered, said, "With the legislative opportunities now exhausted, I urge the president of the United States to immediately release Wall Street TARP funds to the domestic automakers to avoid their impending bankruptcy and its consequent devastation of working families and the depression of our American economy."

It was unclear what role was left to lawmakers after an extraordinary week in which prospects for industry relief seemed to change by the hour.

A week ago, the government reported the loss of 533,000 jobs in November, the worst monthly showing in more than 30 years.

In the days between then and now, the White House and congressional Democrats agreed on a $14 billion measure that would have extended short-term financing to the industry while establishing a powerful new "car czar" to make sure the money was used to turn the Big Three into competitive companies. That bill passed the House on Wednesday but immediately ran into opposition from Senate Republicans who said it did not go far enough.

On Thursday, they demanded the United Auto Workers union agree to accept a lower pay and benefits package that would be in line with compensation earned by workers at U.S. factories producing cars for Japanese companies such as Honda, Toyota and Nissan. In an unprecedented series of negotiations, lawmakers met with representatives of industry and labor on the first floor of the Capitol in hopes of striking a deal — the effort that ultimately collapsed when the UAW balked at the terms demanded.

At a news conference on Friday, UAW President Ron Gettelfinger accused GOP senators who blocked emergency loans of trying to "pierce the heart" of organized labor.

Sen. Bob Corker, R-Tenn., who played a leading role for Republicans, told reporters at the Capitol that the talks came close to success but failed when the UAW refused to commit to lowering its pay-and-benefits package in 2009 so it would be "at parity" with the Japanese companies.

He also laid blame at the feet of the administration. "I think it being known that the White House at the end of the day would probably blink probably helped keep us from a deal," he said.

Whatever the reason, the effort stalled when Republicans voted en masse against advancing the original House bill to a final vote late Thursday night.

___

Associated Press writers Laurie Kellman in Washington and Tom Krisher and Kimberly S. Johnson in Detroit contributed to this story.

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{"commentId":4404821,"authorDomain":"yogibp"}

The resulting comments by the principles in tThe aftermath of the Senate vote last night defeating a loan for GM & Chrysler reminds me of a bunch of kids in 5th grade getting caught red-handed writing on the rest room mirrors.

"I didn't do that!" - "It wasn't me!!

HA! Now listen to all the politicians. both DEM & GOP, and the UAW's Gettlefinger. "Wasn't our fault!!

You kids want to play in Big Time you need to grow up!!

{"commentId":4404821,"threadId":"442395","contentId":"2206757","authorDomain":"yogibp"}
  • 1 vote
Reply#1 - Fri Dec 12, 2008 2:53 PM EST
{"commentId":4405432,"authorDomain":"leitrim"}

Does Ron Gettelfinger think he is doing the auto makers a service with his condescending remarks directed toward southern republicans. I kind of feel like I did after I made a contribution to the red cross for katrina victims, and then heard ray nagin going on and on. I've always preferred to buy American...but now I'm thinking about that Tundra, or is that too classy for an ignorant red neck.

{"commentId":4405432,"threadId":"442395","contentId":"2206757","authorDomain":"leitrim"}
  • 2 votes
Reply#2 - Fri Dec 12, 2008 3:33 PM EST
{"commentId":4405869,"authorDomain":"rdonaldsnyder"}

Does Ron Gettelfinger think he is doing the auto makers a service with his condescending remarks directed toward southern republicans

Southern republicans are wholly owned subsidiaries of the foreign automakers in their districts. They report to their Japanese masters, not to the American people.

{"commentId":4405869,"threadId":"442395","contentId":"2206757","authorDomain":"rdonaldsnyder"}
  • 4 votes
#2.1 - Fri Dec 12, 2008 4:04 PM EST
{"commentId":4478905,"authorDomain":"leitrim"}

Thanks for the nudge, it's got 4wd, leather seats, and a sound system that drowns out all the whining.

{"commentId":4478905,"threadId":"442395","contentId":"2206757","authorDomain":"leitrim"}
    #2.2 - Thu Dec 18, 2008 2:08 PM EST
    Reply
    {"commentId":4405609,"authorDomain":"Sharsworld"}

    Auto makers will get their bailout, heaven forbid if they have to live paycheck to paycheck like ME!!!!!!!!!

    {"commentId":4405609,"threadId":"442395","contentId":"2206757","authorDomain":"Sharsworld"}
    • 4 votes
    Reply#3 - Fri Dec 12, 2008 3:47 PM EST
    {"commentId":4405617,"authorDomain":"nhfishercat"}

    Reads, "Americans, the Auto Industry WILL get your tax money one way or another."

    Strange that the airline industry is always told to go pound sand and restructure with 100's of 1000's of jobs on the line, but now that the piggy bank has been broken I guess everyone should get some. 

    {"commentId":4405617,"threadId":"442395","contentId":"2206757","authorDomain":"nhfishercat"}
    • 2 votes
    Reply#4 - Fri Dec 12, 2008 3:47 PM EST
    {"commentId":4405700,"authorDomain":"jimtrimble"}
    The Frog PrinceDeleted
    {"commentId":4405749,"authorDomain":"christopherhamilton"}
    Christopher HamiltonDeleted
    {"commentId":4405831,"authorDomain":"rdonaldsnyder"}

    If he follows through with this and provides relief, then it's about damn time Bush did something positive for the American workers! What they hell took him so long?

    {"commentId":4405831,"threadId":"442395","contentId":"2206757","authorDomain":"rdonaldsnyder"}
    • 3 votes
    Reply#7 - Fri Dec 12, 2008 4:02 PM EST
    {"commentId":4406159,"authorDomain":"jimtrimble"}
    The Frog PrinceDeleted
    {"commentId":4406195,"authorDomain":"jimtrimble"}
    The Frog PrinceDeleted
    {"commentId":4406526,"authorDomain":"rdonaldsnyder"}

    The fact that there has not been a terrorist attack in the US is in spite of Bush doing a lousy job of trying to make America safer (not securing our ports, trying to sell their control, etc), when in fact his war of choice has made us even less safe. It's also off topic.

    {"commentId":4406526,"threadId":"442395","contentId":"2206757","authorDomain":"rdonaldsnyder"}
    • 3 votes
    #7.3 - Fri Dec 12, 2008 4:47 PM EST
    {"commentId":4406812,"authorDomain":"jimtrimble"}
    The Frog PrinceDeleted
    {"commentId":4407286,"authorDomain":"tyler"}

    6 deleted, advertising.

    {"commentId":4407286,"threadId":"442395","contentId":"2206757","authorDomain":"tyler"}
    • 3 votes
    #7.5 - Fri Dec 12, 2008 5:38 PM EST
    {"commentId":4407562,"authorDomain":"rdonaldsnyder"}

    My initial remark was exactly on topic considering that the subject of this article is about the Bush White House helping the automakers. How in the world could my comment be off topic when it too was about the Bush White House helping the automakers? Your comment makes no sense.

    {"commentId":4407562,"threadId":"442395","contentId":"2206757","authorDomain":"rdonaldsnyder"}
    • 2 votes
    #7.6 - Fri Dec 12, 2008 6:02 PM EST
    Reply
    {"commentId":4406277,"authorDomain":"eric-albert"}

    There are so many muddled strings of arguments here, that within a class perspective, always leads to class conflation, contradictions and redundant dogma.  It will take social conflation to sort out all the issues to a common denominator and real social center and moral plane.  Start off with Bush's Presidential press secretary and you can tell she, as a deformed middle class apologist has no sense of ideology, terminology to history:

    "Under normal economic conditions we would prefer that markets determine the ultimate fate of private firms," White House press secretary Dana Perino said"

    Even under "normal economic conditions", and holds true throughougt much of our class history for the last few thousands of years, including today's LATE CAPITALISM, corporate fascism, market exchange alongside deformed social exchange produces class relations, through a class structure where the middle layers are fractured, divided by lower unpaid, enslaving classes, that keeps the social middle, moral middle and social principle of wealth stunted, and its middle layers fearful, servile, whose position then become "privileged", by subordinating both its middle and lower classes in the service of oligarchies and Empire.

    Therefore markets have always operated in skewed fashion, deformed by class relations, and crippled social wealth, crippled its middle and working classes through a class mechanism and operating even in so called "normal" conditions, class conditions as a ponzi scheme that favors the top classes.  As the class process degenerates over time, destroying democracy, and finally prostrating its middle and working classes, for a handful of aristocrats, the class mechanism breaks, murdering the middle/working classes and in turn the parasites find themsevles unable to get the golden productive classes to continue to lay golden eggs for them.  Therefore we are no longer, even in normal crippled class conditions, we have a corporate fascist system, whose class despotism, has allowed criminal corporations to destroy not only America's economy, but the world economy as a whole.  THE MARKET IS BROKEN, BECAUSE THE CLASS MECHANISM IS BROKEN.

    Then we have two sets of class elites completely subservient to the class dogma, false terminology, the "free markets" which never existed, historically, with class relations, and can only exist through social relations, egalitarian wealth condtions, as Adam Smith's supply and demand principle intended, to operate as a social wealth principle not through a class principle.   The democrats as a class party, corporate party, with their liberal class ideology, are completely clueless when you have misleaders like PELOSI who said this above:

    "In a letter to Bush, House Speaker Nancy Pelosi urged the president to demand "the same tough accountability" and taxpayer protections from the automakers as was contained in legislation that cleared the House at midweek." 

    She and the democrats asked no questions, made no real conditions on the bail out of Wall Street for the tune of a trillion dollars, when the majority of the public were opposed to the bailout that completely failed. She is the last person to talk about "accountability' since the Democratic party has failed at every turn to do oversight, not only in the economy, but foreign policies where these class whores appeased Corporate fascism.

    Still the double standards, class standards perpetuated by these two class ideologies, and two class parties as a whole, need to be sorted out with regard to the real economy, production vs the financial phony economy of Wall Street speculators.   This really is a double standard, one cannot compare throwing a trillion dollars to Wall street, who produce nothing, but siphon off social wealth, to productive industries and workers who produce products, no matter how corrupt its management is.   14 Billion dollars to rescue an industry gets shot down by Fascist republicans who only want to destroy middle class jobs, and Good Unionized middle class wages.   Smashing Unions through bankruptcy is no different than fascist attacking workers parties in NAZI Germany, to force them into slavery.  NO DIFFERENCE.   Here is the despotic class fascism of the Republican corporate thugs:

    "Whatever the reason, the effort stalled when Republicans voted en masse against advancing the original House bill to a final vote late Thursday night."

    With class whores, democrats, and class thugs, republicans helping corporate fascism to smash the remnants of the middle and working classes, and the world economy, who needs friends like these?    We need an alliance of working and middle classes to put into place  a social principle of wealth, that dissovles all class hierarchies, until the global class mechanism is replaced with a social global mechanism for democracy and full development.

    {"commentId":4406277,"threadId":"442395","contentId":"2206757","authorDomain":"eric-albert"}
    • 3 votes
    Reply#8 - Fri Dec 12, 2008 4:31 PM EST
    {"commentId":4406346,"authorDomain":"jimtrimble"}
    The Frog PrinceDeleted
    {"commentId":4406571,"authorDomain":"jopocop"}

    The basic issue, is whether the rest of Americans have take money out of their pocket, as taxpayers, and give it to GM to pay union workers $78 per hour in benefits.

    What are these union workers doing, brain surgery, that commands this kind of money per hour.

    How in the world did they extort that kind of money out of what has been known to be a dying Detroit for many years now.  They killed the goose with the golden egg.

    The whole mess stinks to high heaven, and these workers need to get a big haircut down to sensible wages.

    If the union workers need more bucks to survive, then, they take on 2nd and 3rd jobs like many other Americans.   I know many people that work 2-3 jobs to make ends meet.  

    If the unions will not work for less, then, close down and pull the plug on these dead companies.

    The union chief is a slick and shrewd union boss, sweet talking, looking so smug and innocent and pleading for mercy on his needy workers that have already cut to the bone.

    This union boss ought to go, like the rest of auto management.

    {"commentId":4406571,"threadId":"442395","contentId":"2206757","authorDomain":"jopocop"}
      Reply#10 - Fri Dec 12, 2008 4:50 PM EST
      {"commentId":4407577,"authorDomain":"rdonaldsnyder"}

      The union workers don't make anything near $78 an hour. That is an out and out lie made up out of whole cloth by union busters.

      {"commentId":4407577,"threadId":"442395","contentId":"2206757","authorDomain":"rdonaldsnyder"}
      • 3 votes
      #10.1 - Fri Dec 12, 2008 6:03 PM EST
      Reply
      {"commentId":4406837,"authorDomain":"g-lowell"}

      The Senate let it fail for a reason.  Let them go under.

      {"commentId":4406837,"threadId":"442395","contentId":"2206757","authorDomain":"g-lowell"}
        Reply#11 - Fri Dec 12, 2008 5:07 PM EST
        {"commentId":4406886,"authorDomain":"jimtrimble"}
        The Frog PrinceDeleted
        {"commentId":4407101,"authorDomain":"lerchdavid"}

        If in fact, the UAW is major stumbling block to government help than it is the final proof that unions, especially this union has way over extended its usefulness.  Unions were a good thing when they came into being, workers were abused and literally at the mercy of the employer, but that was 70 years ago.  The UAW has done as much damage to the American auto industry than any design, management or marketing diffuculties any of the big three ever have had.  The pay or die attitude of the UAW may now end the very industry it supposedly has been fighting so long for its members.  And frankly, that should happen.  The wages paid, exclusive of benefits for basic labor work is preposterous.  And the health, pension and unemployment compensation an auto worker has for life is stealing, worse than any overpaid executive. 

        The UAW should dissolve, the government should lend money as necessary to allow our primary manufacturing centers continue and oversee the technology, not the management.

        {"commentId":4407101,"threadId":"442395","contentId":"2206757","authorDomain":"lerchdavid"}
        • 1 vote
        Reply#13 - Fri Dec 12, 2008 5:26 PM EST
        {"commentId":4411216,"authorDomain":"debmark"}

        Your brain should dissolve.

        {"commentId":4411216,"threadId":"442395","contentId":"2206757","authorDomain":"debmark"}
        • 1 vote
        #13.1 - Sat Dec 13, 2008 12:35 AM EST
        {"commentId":4412537,"authorDomain":"PartysOver"}
        PartysOverDeleted
        Reply
        {"commentId":4407211,"authorDomain":"ginnv"}

        The bail out will keep people working, But, If the average American who lost their job or on a budget can not afford to buy a car then how is that helping the economy?

        {"commentId":4407211,"threadId":"442395","contentId":"2206757","authorDomain":"ginnv"}
          Reply#14 - Fri Dec 12, 2008 5:33 PM EST
          {"commentId":4407277,"authorDomain":"lucidcommunication"}

          Everyone is panicking and looking for an easy way out. The auto industry is no different. First of all, the union screwed this. There was a time for unions...that time is no more. Secondly, do we really want a "car czar?" Do we want the government controlling out automotive choices? If we're going to nationalize something, nationalize healthcare. Automobiles are not nearly as necessary. I know it sounds crass to those at the bottom of the automotive foodchain that will lose jobs temporarily, but the issue is that greed has it's consequences. The CEO's of the auto industry were just as greedy as Wall-Street bankers, and now those in their companies must unfortunately pay the price. 

          {"commentId":4407277,"threadId":"442395","contentId":"2206757","authorDomain":"lucidcommunication"}
          • 1 vote
          Reply#15 - Fri Dec 12, 2008 5:38 PM EST
          {"commentId":4412552,"authorDomain":"PartysOver"}
          PartysOverDeleted
          Reply
          {"commentId":4407533,"authorDomain":"michele-2131"}

          Clear thinking, just help them or else there are consequences as seen.  The other countries are showing what will happen.  Greek riots.  Some country is just going to default on US loan I think I just read!!  Congress you need to stop the dem vs rep and get together and resolve this crisis.  It will just continue as it has been.  First it was one small vein not there are larger and larger veins...  I pray for everything and everyone involved to have a clear head and resolve this in the best possible way.  This is my little tiniest of parts in this whole situation.

          {"commentId":4407533,"threadId":"442395","contentId":"2206757","authorDomain":"michele-2131"}
          • 2 votes
          Reply#16 - Fri Dec 12, 2008 5:59 PM EST
          {"commentId":4407573,"authorDomain":"michele-2131"}

          And no this is not spalin kind of God.....

          {"commentId":4407573,"threadId":"442395","contentId":"2206757","authorDomain":"michele-2131"}
            Reply#17 - Fri Dec 12, 2008 6:03 PM EST
            {"commentId":4410320,"authorDomain":"johnlinh"}

            Well, Obama will change all of these. He will spend a lot more for Auto Industry and Bankers.

            I vote to support he California farmers

            {"commentId":4410320,"threadId":"442395","contentId":"2206757","authorDomain":"johnlinh"}
              Reply#18 - Fri Dec 12, 2008 10:45 PM EST
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