Support Marketplace

Taxpayers' returns for Big 3 bailout

Left to Right: Richard Wagoner Jr., chairman and CEO of General Motors, Robert Nardelli, CEO of Chrysler, Alan Mulally, president and CEO of Ford, and Ron Gettelfinger, president of the United Auto Workers, testify at a hearing on the U.S. auto industry on Capitol Hill -- December 5, 2008

TEXT OF STORY

Scott Jagow: It appears the government will help the Big Three automakers. Negotiators from Congress and the White House worked over the weekend on a plan to give Detroit something like $15 billion in short-term loans. On CBS's Face the Nation yesterday, Senator Chris Dodd said there's just too much at stake.

Chris Dodd: None of us like this at all, and there's a lot of reason to be furious at how the industry has handled itself, but there's a lot more at stake than just Detroit. If this were just about some companies in Detroit, I'd let 'em fail in a New York minute.

But a lot of people want strings attached to any bailout for the auto industry. Marketplace's Steve Henn has more.


Steve Henn: David Friedman at the Union of Concerned Scientists says if the automakers our asking for taxpayer money, taxpayers should get something in return. What he wants is for American manufacturers to promise to meet fuel new efficiency standards three years ahead of schedule.

David Friedman: If they did that, consumers would have more efficient cars and we would save $30 billion between now and 2025.

But the Bush administration has proposed raiding a $25 billion loan program that was intended to help carmakers make that switch, and instead using that cash for a broader industry bailout. Environmentalists and many Democrats hate that idea. And a stalemate is still possible.

Robert Shultz is an auto industry analyst at S&P:

Robert Shultz: If absolutely nothing happens into early January with General Motors, they'd be at that point where they'd have to face bankruptcy.

Shultz says if Washington does nothing all three firms could face the same fate within months.

In Washington, I'm Steve Henn for Marketplace.

Comments

I agree to American Public Media's Terms and Conditions.
With Generous Support From...