The Big Three automakers' request for federal aid has fallen on mostly deaf ears in the Senate. Tone-deaf auto executives taking private jets to Washington to beg for billions may have been the final nail in the coffin, as even Senate advocates of a bailout acknowledge their quest has almost certainly failed. Some political leaders have shifted their attention to denying responsibility for an impending industry collapse. But a last-minute compromise attempt to give the Big Three something to help them stay afloat, is taking shape.
CNN Money reports, "Auto industry executives were back on Capitol Hill Wednesday to ask for a federal bailout but they once again faced an uphill battle in winning the necessary support from Congress for a $25 billion loan package."
Politico reports, "Top auto CEOs were subjected to an often contentious hearing before the House Financial Services Committee on Wednesday. ‘It was a bloodbath,' said one industry lobbyist."
The CEOs of the three companies faced particular scorn for their decision to each fly to Washington in private jets at their companies' expense to attend the hearing asking for a federal bailout. "The criticism from Ackerman and other lawmakers -- who travel back to their districts on commercial airlines -- highlighted why the auto executives' request for emergency money remains stuck on the runway," according to the Los Angeles Times.
"Couldn't you all have downgraded to first class or jet pooled or something to get here?" scoffed Rep. Gary L. Ackerman (D-N.Y.), "It could have at least sent a message that you do get it."
With the bailout proposal near death, Congressional leaders are looking to deflate expectations and deflect blame. The AP reports, "The top Senate Democrat sought Wednesday to lower expectations for legislation this week to help endangered carmakers, saying it would be the Bush administration's job to save the industry if Congress doesn't." Sen. Harry Reid (D-Nev.) told reporters that, if the bill were to fail, "it will still be up to the White House and the Treasury Department to take the steps that I believe are necessary and warranted."
The CEOs weren't the only ones seen as unwilling to change their ways to help change their industry. Business Week reports, "Members of Congress were clearly looking for sacrifice from the union's older workforce and retiree pensioners." Rep Walter Jones (R-N.C.) told United Auto Workers President Ron Gettelfinger, "The average family of four in my district makes $36,000 a year, and I find it difficult to ask them to fund much richer salaries and health care of workers in other states."
A compromise bill has emerged, but it isn't clear how likely that version is to pass. Reuters reports, "With a $25 billion Democratic bailout proposal in the Senate stalled due to weak support, the legislative emphasis shifted to a plan endorsed by Republicans and the White House." That bill would also give a $25 billion loan to the industry, but rather than drawing the money from the $700 billion set aside to rescue the financial industry last month, this $25 billion would come from a loan program already approved last month, which was originally intended to help the automakers build more fuel-efficient cars. The automakers believe that money is still needed for its original purpose and should not be reprogrammed to keep the companies afloat in the short term.
That bill's chances of passing are unclear. Banking Committee Chairman Sen. Christopher Dodd (D-Conn.) told reporters he was "anxious to see something happen. But frankly, the idea that there's going to be a bill, I think is remote."
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