Bush White House is poised to use some of the 700B TARP money to aid the automotive industry.
The White House said Friday that it may tap a 700-billion-dollar Wall Street rescue to spare US automakers from an "immediate collapse" that the US economy "could not withstand."
"Given the current weakened state of the US economy, we will consider other options if necessary -- including use of the TARP program -- to prevent a collapse of troubled automakers," spokeswoman Dana Perino said, referring to the Troubled Asset Relief Program conceived to help financial services firms.
Perino, speaking aboard US President George W. Bush's official Air Force One jet, declined to say when a decision would come but said the White House understood "the urgency of the situation."
The House passed the bill to aid the automotive industry for 14B, but the senate republicans killed the bill citing concessions from UAW.
The House of Representatives on Wednesday approved a White House-backed bill, crafted by Democrats, to give the ailing automakers a 14-billion-dollar injection, but the legislation collapsed in the US Senate.
The measure would have required the manufacturing giants to engage in painful restructuring to ensure their long-term survival and repayment of the government monies or face bankruptcy proceedings.
"Congress spoke last night. They don't have the votes to do anything. They didn't get it over the goal line, and so we have to consider what other options we would take but I don't have a time frame on it," said Perino.
"While the federal government may need to step in to prevent an immediate failure, the auto companies, their labor unions, and all other stakeholders must be prepared to make the meaningful concessions necessary to become viable," she warned.
Bush's Republican Senate allies said the bill failed because of a dispute with US autoworkers unions on the timing of bringing their wages in line with those paid by foreign automakers to non-unionized workers in US states.
How these republicans can do this is beyond belief? These same republicans with democrats and Bush White House gave Wall Street half of the 700B Tarp money and they were supposed to use it to help Main Street. Well, we all know they have been sitting on this money and not easing the credit crunch, not giving out loans. Now the republican senate are taking out their anger on the backs of the middle class worker, by stopping the funding of the bridge loan to the automotive industry. Do they want to regain any power in D.C. again? They won't, not doing this crap. Not continuing to help these big time cronies on Wall Street and let the last of manufacturing in this country die.
I understand there are major problems with the automotive industries, and it starts with lack of vision and innovation, but we are talking about 3 to 5 million people losing their jobs, losing their healthcare, slashing pensions, losing more homes, repossession of cars, etc. We are talking about massive unemployment and not a recession but a depression. We are talking about letting foreign companies be the sole manufacturers of automobiles, HERE in the United States of America.
There must be a hard, viable structure going forward for the automotive industry, with the Car Czar watching with heavy oversight. But, letting this industry just die out, is disastrous on all levels.
And while the congress failed to help the automotive industry, GM will temporarily close 20 plants.
General Motors Corp. said Friday it will temporarily close 20 factories across North America and make sweeping cuts to its vehicle production as it tries to adjust to dramatically weaker automobile demand.
GM said it will cut 250,000 vehicles from its production schedule for the first quarter of 2009, which includes a cut of 60,000 vehicles announced last week. Normal production would be around 750,000 cars and trucks for the quarter, spokesman Tony Sapienza said.
Many plants will be shut down for the whole month of January, he said, and all told, the factories will be closed for 30 percent of the quarter.
"We're adjusting pretty dramatically," spokesman Chris Lee said.
The move affects most of GM's plants in the U.S., Canada and Mexico. During the shutdowns, employees will be temporarily laid off and can apply to receive a portion of their normal pay from the company. They can also apply for state unemployment benefits, Lee said.
And this is what UAW has to say about congress:
and morning joe:
And the Gang of 18. These Republican Senators voted FOR the 700B to Wall Street, but AGAINST a 14B bridge loan to the Automotive Industry.
h/t jedreport
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