The $15 billion bailout designed to prevent U.S. automakers from going bankrupt -- especially General Motors Corporation (NYSE: GM) and Chrysler L.L.C. -- need to avoid bankruptcy has hit a snag, according to the New York Times. Ford Motor Company (NYSE: F) is not in as dire shape."The last-minute disagreement centered on a single word - with the Senate bill requiring the automakers `to comply with all applicable federal fuel efficiency and emissions requirements' and the House bill referring to `all applicable fuel efficiency requirements,' which would also include state emissions rules that the automakers oppose," the Times said.
Senate aides told the paper that the House bill was "doomed" because it would be rejected by the Senate. Many Republicans also oppose the bailout. These sorts of fights are nothing new.
Detroit has fought against tighter CAFE (Corporate Average Fuel Efficiency) standards for years, arguing they made them less competitive. The companies were able to beat back these efforts thanks to Rep. John Dingell, who chaired the Energy and Commerce Committee. Dingell could make bureaucrats, particularly those at the EPA, quiver at the mention of his name. They dreaded receiving "Dingell grams", lengthy often acerbic letters designed to heap scorn on policies he opposed -- and there were many. But Dingell is gone now.
Rep. Henry Waxman ousted Dingell from his committee chairmanship a few weeks ago. It was a huge defeat for Detroit since the California Democrat is far less sympathetic to its views or the views of much of corporate America. But change had to come.
The auto industry had been protected by Dingell and its allies on Capitol Hill. Maybe Detroit would not need a Czar if the U.S. had proper CAFE standards. That's water under the bridge now. We can no longer argue over whether Detroit caused its own problems. The fact of the matter is that many Americans prefer foreign cars which they perceive as being of better quality. My wife and I recently purchased a Ford, so I know this is a debatable point.
In the end, Detroit is deserving of as much help as the government can afford to give.
Nuclear power is on the comeback trail
Apple backs AT&T in continuing spat with Verizon
Closing Bell: The recession is still over, still... do you feel it?
Reader Comments (Page 1 of 1)
12-10-2008 @ 8:46PM
R.Rossow said...
I have not read what the auto companies will do for the money. They can't sell the cars that they make now. How can they make more cars? What will the workers do? just get hand outs? Be laid off anyway? Maybe they will run cars out one door and back in another to be scrapped and made over again.
12-11-2008 @ 5:00AM
Lance said...
I choose to not participate in the auto loan bail out. I choose to not participate by not buying UAW made vehicals from the Big 3. I also choose to not participate by not hiring these same folks as they are out of work on their owen greed.
I will buy American made vehicals. Made by hard working folks for fair wages from Honda, Toyota, VW and KIA.
12-11-2008 @ 7:31AM
shelly said...
These 3 can make a few bucks selling all the scrap metal there going have sitting around.
1 vehicle alone would be worth at least 10 bags of pop cans. Don't ya think?
12-11-2008 @ 9:41AM
Bucko said...
You will be able to thank the Republicans for what will happen when the big 3 go down. All we are asking for is a loan. Isn't it funny that they will throw 700 billion at people that take showers before work and manufacture nothing,but will not loan 14 billion to the people that have to take a shower after work and actually build something.They do not even know where all the money is going but they gave it to them.Sen. Shelby How much are your big 3 going to give you for your campain? Toyota,Mercedes and Honda when you do what ever you can to destroy the American working class.Maybe they will build another factory in your state so you can give them another million dollar tax break.Unemployeement at a 26 year high. And the Republicans are ready and willing to put another 3-5 million people out of work. Remember the next time you vote America ,they had a chance to help and they turned there backs on us.
12-25-2008 @ 9:40AM
Doug said...
It basically makes you want to cry when you think that these people in Congress including our newly elected president have given all this money to the incompetents that ran their respective businesses into the ground and then complain when they misspend the money. What idiots would give these companies that kind of money without any rules attached to monitor how it is spent and then complain the companies were not using the money correctly. The people at fault here are not the people who run the companies it is the equally incompetent politicians who now want to divert the blame, as usual, away from themselves. They all ought to be replaced for treating the taxpayers like they too are idiots. Go figure just how bad off we are with people like this running the government. Its like having the fox guard the hen house!!!!!!!!