Votes may be lacking in Congress

WASHINGTON - Imperiled automakers and their union worked feverishly Wednesday to sell a skeptical Congress on a $34 billion aid plan, promising labor concessions and restructuring. The Senate's Democratic leader said there still weren't enough votes to tap the $700 billion federal bailout fund to prop up the foundering Big Three.

One day before the chiefs of the auto companies return to Capitol Hill to make their urgent cases for loans, Sen. Harry Reid, D-Nev., said the money was unlikely to come from the Wall Street rescue fund.

''I just don't think we have the votes to do that now,'' Reid told The Associated Press in an interview.

The White House called the timing of his comments ''interesting'' coming on the eve of high-stakes congressional hearings Democrats demanded.

''It's not hospitable,'' said Dana Perino, the White House press secretary.

Tom Cole, one of the owners of Cole Valley Auto Group in Bazetta, said the Pontiac name likely won't disappear, as did another former GM division, Oldsmobile.

Instead, Pontiac will become a ''boutique'' franchise offering vehicles for a specialized customer base, he said. He acknowledged he doesn't know exactly what that means, but said the brand still will be part of GM.

The Elm Road dealership, which also offers Cadillacs, went through an earlier GM brand change when the automaker ended its Oldsmobile vehicle line in 2004. Cole family members who owned Downtown Oldsmobile in Warren merged the dealership with the Elm Road operation in 2002.

Another prominent area dealer, Jim Pace, could face a double challenge if GM downsizes not only Pontiac but also takes action with its Saturn division. Pace sells both car lines at two dealerships in Niles and has the area's only other Saturn dealership in Boardman.

Pace couldn't be reached for comment.

In Capitol Hill meetings, industry officials said the collapse of one or more of the Big Three carmakers could greatly worsen the nation's recession and undermine the companies' ability to survive.

''We're on the brink with the U.S. auto manufacturing industry. We're down to months left,'' Chrysler's vice chairman, Jim Press, told the AP in a separate interview. ''If we have a catastrophic failure of one of these car companies, in this tender environment for the economy, it's a huge blow. It could trigger a depression.''

The United Auto Workers union, scrambling to preserve jobs and benefits, agreed at an emergency meeting in Detroit to allow the companies to delay payments to a multibillion-dollar, union-run health care trust and to scale back a jobs bank in which laid-off workers are paid most of their wages. The concessions could help mollify some lawmakers who have criticized the union's benefits as too rich when compared with those of workers at foreign-brand auto plants in the U.S.

The Bush administration and auto-state Republicans and Democrats are pushing to help the automakers with aid from a different source: a previously approved $25 billion program that's supposed to be used to help them produce more environmentally advanced vehicles.

Environmentalists - and a number of powerful friends in Congress - are vigorously opposing that idea.

Reid said the administration could act unilaterally to use a portion of the Wall Street bailout program for loans to the automakers, but the White House has consistently resisted that approach.

''There's talk going around now that the Bush White House may ask for'' the second $350 billion installment of the $700 billion financial industry rescue fund, Reid said.

But if Bush's team doesn't act, he said, ''I think that we are probably going to have to try to do something'' in Congress.

Reid said he would rely on Sen. Chris Dodd, D-Conn., chairman of the Senate Banking Committee, to determine what kind of legislation would be appropriate.

The autoworkers' concessions are ''a step in the right direction,'' he said.

''I think it's too bad that negotiated contracts between labor and management are going to have to be changed,'' Reid said. ''But it's obvious to everyone - as strong of a union guy as I am - it's obvious that there has to be some changes made.''

Ahead of Thursday's televised hearings, GM's president and chief operating officer, Fritz Henderson, met with congressional aides and said bankruptcy for his company would further erode consumer confidence. About 25 auto dealers also combed through House and Senate office buildings, lobbying for the bailout package.

General Motors Corp., Chrysler LLC and Ford Motor Co. submitted three separate survival plans to Congress this week after flunking their first attempt to persuade lawmakers to throw them a lifeline.

GM and Chrysler said they needed an immediate infusion of government cash to last until New Year's, and both said they could drag the entire industry down if they fail. Ford wants a $9 billion standby line of credit in case a competitor fails.

Chrysler said it needed $7 billion by year's end to keep operating. GM asked for an immediate $4 billion as the first installment of a $12 billion loan, plus a $6 billion line of credit to use if conditions worsen.

Ford's chief executive, Alan Mulally, and GM's chief executive, Rick Wagoner, said they would work for $1 a year if each company accepted government loans. The carmakers also have offered to cancel bonuses and merit raises. Chrysler said its chief executive has cut his annual pay to $1.

All three plans envision the government getting a stake in the companies that would allow taxpayers to share in future gains if they recover.

The Senate Banking, Housing and Urban Affairs Committee was to hear testimony Thursday from the executives, the UAW's president, Ron Gettelfinger, and the head of the Government Accountability Office on the companies' plans. The House Financial Services Committee planned similar session Friday.

Officials at the White House and the Treasury and Commerce departments were scouring the plans. Perino said it was ''too early to say'' whether the companies have outlined a path toward viability that justifies new federal assistance.

President-elect Barack Obama said it appeared that Big Three chiefs were returning to Washington with a ''more serious set of plans.''

The bailout faces a skeptical public. Sixty-one percent oppose providing the auto companies with billions in federal assistance, according to a CNN-Opinion Research Corp. poll released Wednesday. Fifty-three percent said it would not help the economy.

Few saw any quick impact if the U.S. auto industry were to go bankrupt - only one in three expected to be affected immediately or in a year. Most of the rest said they thought it would affect them eventually, though nearly one-quarter said they would never feel its impact.

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Associated Press writers Erica Werner, Julie Hirschfeld Davis and Deb Riechmann in Washington, Kimberly S. Johnson in Detroit and Joe Milicia in Cleveland contributed to this report.

AP-CS-12-03-08 1949EST

Member Comments

View Comments: | 1-8 | Post a comment

anniemae
12-05-08 12:25 AM »Report Abuse	I think our government otta "skinny " down, too. Too many "do nothings" getting paid far too much money,,,,,by US, the taxpayers. Lots of fat cats in DC.
Masuryman
12-04-08 5:50 PM »Report Abuse	Zipcityboy, come up w/ a new line besides your Abe Lincoln & your treason, please. Are you caught in a "time warp"? This idea is the only one you use in all your posts; don't pull a muscle but try to THINK UP a new thought!
Justmyopinion
12-04-08 1:45 PM »Report Abuse	I'll tell you what their positions are....they are FOR it and it doesn't matter what their constituents want.
Sassysue
12-04-08 1:33 PM »Report Abuse	Zipcityboy you need to get off this treason kick...the big 3 and UAW got themselves into this mess!
jstfacts
12-04-08 10:43 AM »Report Abuse	What are the positions of Representatives Ryan, Wilson and LaTourette on the Loan to the Auto Industry?
Handala
12-04-08 9:34 AM »Report Abuse	No strings attached!?The Federal Government (the worst run business on the planet)now owns 70% of AIG!We are officially a Socialist Republic! How much longer do you think the Auto Industry will survive after Congress gives them 35 Billion dollars at 17% intrest, when during the best of times they were reporting huge losses!?
SURV69
12-04-08 8:59 AM »Report Abuse	zipcityboy I agree 100% in respect to the double-standard. BUT, I don't think Wall Street should've gotten the $700 billion, which has already been mis-used(as National City Bank). It's called medicine(adjustment), which is about 20 years in the making and those 20 years have been extremely inflationary . . . a lot more inflationary than the official reports indicate.
zipcityboy
12-04-08 8:22 AM »Report Abuse	$700 billion bailout for Wall Street; no strings attached; no plan demanded; no concessions forced. But not even a fraction of that in a loan to Main Street to save 3 million jobs even after concessions. None dare call this treason to America. I do.

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