Automakers regroup after $14 billion bailout collapses
WASHINGTON -- A bill that would have extended $14 billion in emergency loans to distressed U.S. automakers collapsed last week in the final hours of Congress.
Senators declared an impasse following the failure of 11th hour negotiations over terms of the rescue.
Officials with General Motors and Chrysler said the aid would keep them out of bankruptcy. The fate of the companies remained tenuous as the focus shifted to whether the Bush administration would offer last-minute help. Ford Motor Co., said it did not need a loan, but its future would be tied to that of its competitors and their suppliers.
The Senate failed to gain 60 votes necessary in a procedural vote to keep the measure alive. The vote was 52-35 for the bill. Afterward, Democrats and Republicans traded blame for the collapse.
The main sticking point was a dispute between Republicans and organized labor over wage cuts for union workers at auto plants. There was no agreement on a timetable for when labor costs for U.S. automakers would be made more competitive with foreign counterparts.
Republicans charged the United Auto Workers union was refusing to commit to lower wages. Democrats said Republican efforts were aimed at union-busting by singling out workers for concessions they were not insisting upon for other parties.
Sen. John Ensign, R-Nev., voted against moving forward with the bill. Sen. Harry Reid, D-Nev., supported the bill but voted against it under a procedure that allows him as Senate majority leader to call it up again at a later time.
Earlier in the week, the House passed the auto bailout, 237-170. Supporters said the emergency loans were vital to avert automaker bankruptcies that could throw more workers out of jobs in a bad economy.
Critics said the loans would have been no more than a Band-Aid, and that the legislation did not go far enough to force companies to restructure their operations.
Reps. Shelley Berkley, D-Nev., and Jon Porter, R-Nev., voted for the bill. Rep. Dean Heller, R-Nev., voted against it.
Contact Stephens Media Bureau Chief Steve Tetreault at stetreault@stephens media.com or 202-783-1760.
