December 8, 2008

Dems unveil automakers rescue plan

Congressional leaders Monday announced details of $15 billion in emergency loans proposed for U.S. automakers, using loan funds already passed into law.

The measure would extend the funding provided that automakers operate under strict oversight of a monitor appointed by the White House, the Los Angeles Times reported. House Speaker Nancy Pelosi, D-Calif., and Financial Services Committee Chairman Barney Frank, D-Mass., said the legislation would require General Motors Corp., Chrysler LLC and Ford Motor Co. to get on a stronger financial footing without putting too much taxpayer money at risk, the newspaper reported.

We want to be able to review the performance of the auto companies as they go forward, Pelosi said.

Frank said earlier Monday that Pelosi and the White House had overcome a major hurdle and agreed to use available funds from a $25 billion loan program for automakers previously enacted by Congress and signed into law. The White House had insisted that was the only money available for a bridge loan, while Pelosi had argued using the funds would compromise the fuel-efficiency standards written into that loan program.

Frank said we will not see a diminution of funding available for energy efficiency because of the payback schedule for the $15 billion draw on those funds.

The bill includes a very high degree of assurance that we'll be paid back, Frank said.

White House spokeswoman Dana Perino said the bill is moving in a direction President George W. Bush could support.

Frank said the funds would not float the industry to March, but by then a new administration will have taken over and made new decisions.

Michigan Gov. Jennifer Granholm had said Monday if GM does not receive federal help by the end of the month it is game over for the automaker.