Senate to debate auto bailout

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U.S. Rep. Tim Ryan of Niles

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Sen. George V. Voinovich, R-Ohio

STAFF/WIRE REPORTS

WASHINGTON — A $14 billion rescue package for the nation’s imperiled auto industry sped to approval in the House late Wednesday, but the emergency bailout was still in jeopardy from Republicans who were setting up roadblocks in the Senate.

Democrats and the Bush White House hoped for a Senate vote as early as today and enactment by week’s end. They argued that the loans authorized by the measure were needed to stave off disaster for the auto industry — and a crushing further blow to the reeling national economy.

The legislation, approved 237-170 by the House, would provide money within days to cash-starved General Motors Corp. and Chrysler LLC. Ford Motor Co., which has said it has enough to stay afloat, would also be eligible for federal aid.

Republicans were preparing a strong fight against the aid plan in the Senate. The Republicans want to force the companies into bankruptcy or mandate hefty concessions from autoworkers and creditors as a condition of any federal aid.

“I think there’s still some effort that has to be made,” said Sen. George Voinovich, R-Ohio, a strong supporter of the auto industry who said he would vote for the legislation. Democrats hold a narrow 50-49 Senate majority, and they need at least 10 Republicans to vote for the bailout to overcome procedural hurdles.

Speaking from Washington after the vote, Mahoning Valley Rep. Tim Ryan said the package had just overcome its “first hurdle, a vote out of the House.

“The Senate is not quite there yet where they have the votes to pass this bridge loan. The next few days are going to be pretty interesting,” said Ryan, of Niles, D-17th.

House Speaker Nancy Pelosi said the House-passed bill represented “tough love” for U.S. auto companies and “giving a chance — this one more chance — to this great industry.”

Ryan contended the Big Three American carmakers “are getting squeezed and, in my opinion, the CEOs may have made some mistakes in the past, but they didn’t create the global credit problem ... if we’re willing to sacrifice the last bit of industry that we have in the United States, then shame on us.”

“I would have much rather seen the full $34 billion,” Ryan continued, adding, “but having Barack Obama piece this thing together early next year, I think it will be a much better package.”

The White House, struggling to sell the package to congressional Republicans, said earlier that a carmaker bankruptcy could be fatal to the auto industry and have a devastating impact on workers, families and the economy.

But the measure faces a difficult road in the Senate.

Even among Senate Democrats, the level of support was still uncertain. In the House, 20 Democrats joined 150 Republicans in voting “no,” while 32 Republicans sided with 205 Democrats to back the bill.

“There is bailout fatigue in Washington, D.C., and people are not comfortable with putting up taxpayers’ money for any businesses,” Ryan observed.

He added, though, that the package “is a loan; this is not a grant giveaway and there are adequate protections in here to make sure there are no golden parachutes ... this is a lot better bill than when we passed the $700 billion bill a few months ago.”

Besides providing cash for the auto companies, the bill would create a government “car czar,” to be named by President George W. Bush to dole out the loans, with the power to take back the money and force the carmakers into bankruptcy next spring if they didn’t cut quick deals with labor unions, creditors and others to restructure their businesses and become viable.

Behind the scenes, Senate Democratic and Republican leaders scrambled for a deal that would allow votes on the bill today. Some GOP senators were demanding votes on an alternative that would order the automakers to take specific actions to restructure — including steep wage cuts and debt restructuring — in return for any federal money.

Ryan remains unsure about what will happen when the bill hits the Senate.

“Right now it doesn’t look too good ... I’m a lot less optimistic today than I was yesterday or the day before,” he said.

, adding, “It is going to be a sad holiday season for a lot of families if nothing gets passed.”