You are currently viewing the printable version of this article, to return to the normal page, please click here.

Automaker bill failure sparks GOP intra-party war

UPDATED:

Republicans on Friday angrily demanded that President Bush respect the legislative process after the Senate blocked a bailout for the automakers and the White House said Mr. Bush would consider reversing course and rescuing them on his own.

The bailout's failure has sparked a full-blown intra-party war, with several Republicans saying the White House scuttled their efforts to win concessions from the United Auto Workers union and one Republican senator arguing Washington "might be completely out of control."

"How have we come to a point that Congress -- the institution that represents the will of the American people -- has handed over so much money and authority to the Treasury Secretary that, if the democratic process fails to achieve a certain desired outcome, the outcome is simply ignored?" said Sen. James Inhofe, Oklahoma Republican.

Late Thursday Senate Republicans led a filibuster to block a $14 billion rescue package for the automakers that Mr. Bush had negotiated with congressional Democrats. The bill failed to reach the 60 votes needed to stop the filibuster, with senators voting 52-35 for the bill.

Hours later the White House said Mr. Bush would consider tapping funds from Troubled Assets Relief Program, created by Congress earlier this year to help financial institutions, to aid automakers. Previously the president had balked at using TARP funds, saying they were not appropriate for rescuing failing auto businesses.

"Under normal economic conditions we would prefer that markets determine the ultimate fate of private firms. However, given the current weakened state of the U.S. economy, we will consider other options if necessary including use of the TARP program to prevent a collapse of troubled automakers," said White House Press Secretary Dana Perino.

Mrs. Perino admonished the Senate.

"It is disappointing that while appropriate and effective legislation to assist and restructure troubled automakers received majority support in both houses, Congress nevertheless failed to pass final legislation," she said.

But senators said the White House hurt their efforts to win concessions from the unions and get a deal done.

Sen. Bob Corker, Tennessee Republican and his party's chief negotiator on the rescue package, said United Auto Workers President Ron Gettelfinger now has no incentive to work out a deal, knowing Mr. Bush will step in.

"He believes he's gotten indications from the White House that TARP money is coming. And I think he believes that at this point there's really no reason to carry the conversations any further," Mr. Corker said.

And Sen. Judd Gregg, New Hampshire Republican, said Mr. Bush would be wrong to reverse course and use the TARP funds.

"A decision to use TARP would set a new precedent that the next administration may use to aggressively assert industrial policy and expand government control into numerous specific businesses that are having troubles during these difficult times," he said, echoing Mr. Corker's charge that the White House ruined their negotiating position.

"Had the administration made it unequivocally clear that TARP funds should not be used for this purpose, it is likely a bipartisan, constructive solution to the auto issue would have been reached in the Senate last night," Mr. Gregg said.

Republicans wanted to have a date certain in 2009 by which the auto unions would have to have a lower pay scale comparable to manufacturers such as Nissan and Volkswagen.

But Mr. Gettelfinger said the differences between various wage scales was unclear and to determine a level of parity would require research, which he said the union would want to extend to the management teams and supplier contracts for foreign-transplant car compaines in the U.S.

Mr. Gettelfiner said Repubicans wanted the auto industry restructured "on the backs of workers and retirees," adding that none of the other stakeholders -- Big Three management and creditors -- were asked to set a date certain for concessions.

Mr. Bush did win praise from Democratic leaders who said he had negotiated fairly with them.

They also urged him to use the TARP funds a move they had advocated from the beginning though they said he should insist auto manufacturers meet the requirements set forth in the bill Congress tried to pass.

"That legislation contained tough accountability and strict timelines for the automakers to develop a comprehensive restructuring plan to place them on a path toward viability and competitiveness," House Speaker Nancy Pelosi said in a letter to Mr. Bush. "Failure by the automakers and other stakeholders to act urgently in developing and implementing a restructuring plan would end taxpayer assistance and permit the recalling of all loans."

Both General Motors Corp. and Chrysler LLC have suggested they could be just a few weeks away from bankruptcy without the prompt passage of a bill. Ford Motor Co. is in somewhat better short-term shape, but the collapse of even one of Detroit's Big Three would have huge repercussions throughout the economy. Together, they employ about 3 million people in autoworker and industry-related jobs.

President-elect Barack Obama said Mr. Bush and Congress should keep working.

"I share the frustration of so many about the decades of mismanagement in this industry that has helped deliver the current crisis. Those bad practices cannot be rewarded or continued. But I also know that millions of American jobs rely directly or indirectly on a viable auto industry, and that the beginnings of reform are at hand," he said in a statement.

Mr. Obama is no longer in the Senate but Vice President-elect Joseph R. Biden Jr. is. Mr. Biden did not vote on the package.

© Copyright 2014 The Washington Times, LLC. Click here for reprint permission.

Comments
blog comments powered by Disqus