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Congress Bails on Auto Aid, Tells Detroit to Come Back with Plan |
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With a Republican filibuster and a promised veto by President Bush in store for a $25 billion emergency bridge loan for the auto industry, Senate leaders today postponed action on legislation to help the industry weather the credit and economic crisis.
But congressional leaders say they are willing to come back into session after Thanksgiving if Detroit’s Big Three can present a detailed plan by Dec. 2 on how they plan to spend the money and retool the industry.
Says Senate Majority Leader Harry Reid (D-Nev.):
No one has come up with a plan that can pass the House and Senate and be signed by President Bush.
But he also noted that the delay in helping Detroit could have been avoided. Reid says Bush has the authority to use funds from the $700 billion Wall Street bailout.
Let me remind everyone once again that the administration has all the authority and all the resources it needs to help these companies should they need it. If the White House wants to save Detroit, it has the power and the tools to do so.
The decision to pull back came after two days of often contentious hearings in which the heads of General Motors, Ford and Chrysler, as well as UAW President Ron Gettelfinger, were harshly questioned by lawmakers about the industry’s failures and how the proposed bridge loan would be used.
In a statement this afternoon, Ford said it:
welcomes the opportunity to provide our plan to Congress. We have a great plan that will continue Ford’s transformation into a lean, profitable company that delivers the safe, fuel-efficient, high-quality new products that our customers want and value.
Car and truck sales have sunk to the lowest level in 25 years. The automakers have been forced to burn through their cash reserves, and news reports say GM could run out of money and be forced to shut down by the end of the year.
At a news conference today, Gettelfinger warned that unless some action is taken before the end of the year, one of the Big Three may be forced to close it doors and one or both of the remaining companies could follow, costing millions of jobs not only in the auto plants but up and down the supplier and dealer chain. Some 3 million workers are employed in the auto industry. Said Gettelfinger:
If one of these companies goes over the cliff, it could for sure take at least one of the others, if not both, with them. We cannot allow one of these companies to fall off a cliff.
He also slammed lawmakers from states that have given some $3 billion in tax breaks and incentives in recent years to foreign carmakers to locate in their states. Gettelfinger pointed to Republican Sen. Richard Shelby, whose home state of Alabama now has four foreign car plants. Shelby has been the most vocal critic this week of the loan legislation and of the auto industry. Said Gettelfinger:
We can help the financial industry and give incentives to let foreign automakers compete against us, but at the same time we’re able to walk away from the industry that is the backbone of our economy.
Click here to see the news conference.
Many congressional critics and columnists this week have slammed the type and quality of vehicles made by GM, Ford and Chrysler, and the men and women who make them. A post on the UAW website says:
There are a lot of half-baked notions out there in the media and cyberspace about the vehicles we union members make.
Earlier this week, the Detroit Free Press made an effort to slash through some of the half-truths and misrepresentations with a story headlined “6 myths about the Detroit 3.”
Click here to read the Free Press story.
11 Comments
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Thanks President Gettlefinger for speaking to congress on behalf of the workers!!! Congress and the president seem to be living in another world. They can give a blank check to the Wall Street crooks that got us into the credit crisis, but are reluctant to help a great American industry. Most governments value and cherish manufacturing– except ours. We have a bunch of out of touch idiots sitting in congress. With 3 million jobs at risk and 1 million retirees at risk, they seem content to do nothing. We have to demand better from our elected officials.
This economic situation is an opportunity for unionism to flourish. Right now, the Republicans and “Right to Work” advocates are relishing the position that unions, like the UAW are in at this time. I would like to see the Presidents of all the unions come together and have a public conference on the state of the economy and American business. The outcome may be positive or negative, but we should flex our union “muscle” and show solidarity with each other and let the politicans and wealth mongers on Wall Street know that the American worker will not be treated lightly.
I can remember when the unions stood together and shut the country down when their rights were being infringed upon. Whether union or not, the American worker is at a crossroads, at this very moment. If one of us falls, who will be next?
Like I said in another post this is the perfect time for some shock and awe. Come out with some hard number comparisons between the union and non-union jobs in the auto industry.
Show the history of how the foreign car companies were forced to come to this country by our government. Things like the incentives mentioned in this article. Fringe benefit comparisons would be a great angle as well. Somehow the general public need to get the facts and not rhetoric.
These companies have been laying off workers, moving jobs overseas and forcing worker concessions for 30+ years saying it’s to make them more competitive with their foreign competitors. I think they need to look at executive management. US auto industry execs make 10-20 times what their foreign counterparts make. For example, the CEO of GM made 24.7 million in total compensation last year compared to the CEO of Toyota who made only 1 (yes, that’s one) million. Let’s bring executive compensation and perks into line with foreign auto makers and then talk about labor costs.
I would be good to present non-union perks in the auto industry to the masses - evidently they seem to think the only ones profiting are union workers.
On another note - we should push hard for congress to coerce companies that offshore work and use h1bs to bring the jobs back here for Americans or not get the taxpayers’ money. Think about the double slap that laid off IT workers at Chrysler would get when their unemployment comp taxes go to bail out a company that fired them and gave their jobs to Indian outsourcers.
We are all in this together. http://www.madnamerica.com
Give the auto industry the bailout they need. I want to know why Wall Street was not forced to come back with a “plan” before they received all THEIR money. Who is monitoring what they are doing with “their” money, that should be “our” money. Our government has given Wall Street a big fat raise, on the backs of American taxpayers. We should have bailed out the auto industries BEFORE we gave any money to Wall Street; at least people would be able to keep their jobs, and the economy might be doing a bit better. There is something very sinister in this whole “who gets a bailout” scheme. I smell hypocrisy. This stinks!
I am tired of the Union being blamed. Poor management choices on quality and vehicle types to build is causing this problem with the big 3. Energy prices have been rising for quite some time and they chose to continue to ignore needed fuel economy increases and continued to build and rely on very large gas guzzlers. This, while taking astonishing high salaries and bonuses.
I agree with you, 100%!
Did we really see the Big Three step forward with an effort to ask for money, or did we see the beginning of a plan to renege on existing contracts and erode workers rights?
Time to look between the lines.
American Owned American made is becoming hard to find as Washington continue to allow our markets to be over run by not so fair “free trade” Washington Jumped at the chance to help the banks and wall street. Money for the rich and greedy is all the great bailout seems to be about. We must help our American owned companies who produce here in America! The big 3 auto companies should present a plan for restructure and do it and we the people of America should help! That includes you Congressmen in Washington. The America working class is so tired of whats been coming out of Washington for a long time now.
Give them the money when they agree to bring the auto jobs back to the USA and pledge they will not spend the money on foreign plants.
Make sure the CEO’s and Salary personnel take their share of cuts also, not just the wage personnel