WASHINGTON (AP) - A Democratic Congress, unwilling or unable to approve a $25 billion bailout for Detroit's Big Three, appears ready to punt the automakers' fate to a lame-duck Republican president. Caught in the middle of a who-blinks-first standoff are legions of manufacturing firms and auto dealers—and millions of Americans' jobs—after Senate Democrats canceled a showdown vote that had been expected Thursday. President George W. Bush has "no appetite" to act on his own.
U.S. auto companies employ nearly a quarter-million workers, and more than 730,000 other people have jobs producing the materials and parts that go into cars. About 1 million on top of that work in dealerships nationwide. If just one of the auto giants were to go belly up, some estimates put U.S. job losses next year as high as 2.5 million.
"If GM is telling us the truth, they go into bankruptcy and you see a cascade like you have never seen," said Sen. George V. Voinovich, R-Ohio, who was working on one rescue plan Wednesday. "If people want to go home and not do anything, I think that they're going to have that on their hands." ...
Senate Majority Leader Harry Reid, D-Nev., scrapped plans Wednesday for a vote on a bill to carve $25 billion in new auto industry loans out of the $700 billion Wall Street rescue fund.
It's really up to Bush's team to act, he said.
"I don't believe we need the legislation," Reid said. Treasury Secretary Henry Paulson can tap the financial industry bailout money to help auto companies, Reid said, but "he just doesn't want to do it."
Not our responsibility, countered the White House.
"If Congress leaves for a two-month vacation without having addressed this important issue ... then the Congress will bear responsibility for anything that happens in the next couple of months during their long vacation," said Dana Perino, the White House press secretary.
She said there was "no appetite" in the administration for using the financial industry bailout money to help auto companies.
The White House and congressional Republicans instead called on Democrats to sign on to a GOP plan to divert a $25 billion loan program created by Congress in September—designed to help the companies develop more fuel-efficient vehicles—to meet the auto giants' immediate financial needs.
Voinovich and Sen. Kit Bond, R-Mo., along with Democratic Sen. Carl Levin of Michigan, were at work on that measure Wednesday, trying to placate skeptical Democrats by including a guarantee that the fuel-efficiency loan fund would ultimately be replenished.
"It is the only proposal now being considered that has a chance of actually becoming law," said Republican leader Mitch McConnell of Kentucky.
Given the level of support the unions have generated for President Bush and Republicans (which is none) I could certainly understand why he's in no hurry to bail out their excessive compensation and retirement packages. Secretly, he probably wouldn't mind seeing those thugs have to renegotiate all their deals and lose a lot of expensive perks.
In the next Senate the Dems may well be filibuster proof, provided they can hold their own side together, and that's not guaranteed. If I were President Bush I think I'd sit back and let the Congress sort this out, and if they can't figure out what to do, allow Chapter 11 to work its magic.
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