Automaker loans still have opposition
Making their case for a $34 billion government bailout of the U.S. auto industry are, from left, General Motors CEO Richard Wagoner, United Auto Workers President Ron Gettelfinger, Ford Motor Company CEO Alan Mulally, and Chrysler CEO Robert Nardelli.
TEXT OF INTERVIEW
Scott Jagow: An important question right now: Is $15 billion enough for the carmakers to survive?
This morning, a top GM official said yes, it is, in the short term. Long-term, it could be another story. But right now, the automakers claim they need cash and they need it fast. It looks like Congress could vote on the loans tomorrow, but there is still opposition to some parts of this deal.
We're joined by Marketplace's Dan Grech. Dan, what are the sticking points between Republicans and Democrats?
Dan Grech: Well, the Bush administration says the plan should be a heck of a lot tougher on automakers. Specifically wants GM and Chrysler to know that there will be no more federal money coming their way if they can't get their act together by March, which is when these loans would run out. Under the plan, the president would appoint a car czar that we've been hearing a lot about who would oversee the restructuring, and that czar would have the ability to review any contract worth more than $25 million. And that doesn't sit well with the White House either.
Jagow: And why not?
Grech: The White House didn't say, but I would venture a guess that they would feel like that's too much meddling of the government in the operations of a private business.
Jagow: And why does it matter, actually, that Republicans aren't on board with this? They're already outnumbered in Congress and President Bush is on his way out.
Grech: You know, it's a really good question. You know, you think of this as kind of a lame duck administration that's lost authority on these issues, but in fact President Bush does still wield the veto pen. And then you also have to remember that in order for it to even get to his desk, it would have to pass through the Senate, and Republicans there could filibuster it.
Jagow: What do you think the prospects are of this passing?
Grech: I think that there's still pretty strong opposition to this among Senate Republicans, but the Democrats who are leading this charge insist that these are just road bumps. Barney Frank, the chairman of the House Financial Services Committee said, and this is a direct quote, "It is overwhelmingly likely that a bill will be on the president's desk by the end of the week."
Jagow: Marketplace's Dan Grech. Thank you.
Grech: Thanks a lot.