December 6th, 2008
09:24 AM ET
14 years ago

Deadlock over Detroit bailout may soon end

[cnn-photo-caption image= caption="News of November job losses "changed everything" for House Speaker Nancy Pelosi, an official said."] WASHINGTON (CNN) - Help may soon be on the way to the struggling U.S. auto industry after House Speaker Nancy Pelosi backed off her opposition to using funds from a fuel-efficiency research program for a bailout, two congressional officials said Friday.

The significant move from Pelosi signals that the deadlock over rescuing Detroit may be over.

Congressional Republicans and President Bush support the idea of tapping the $25 billion advanced technology fund. Two officials familiar with compromise talks told CNN that the working target is $15 billion to $17 billion in bridge loans, intended to fund the struggling Big Three automakers through March.

Watch Congress mulls auto bailout

However, one senior Democratic congressional source told CNN that House and Senate committee staff will meet over the weekend to write a bill to provide $20 billion to $25 billion in assistance to the U.S. auto companies.

This aide said the "mathematicians were working" at how to reprogram the money by reducing a subsidy to come up with a figure that would be available for loans, despite an earlier report that only $7.5 billion was available from the fund passed last year for fuel efficiency research.

This aide said the bill could be on the House floor as early as Tuesday, but thought it was more likely that the Senate would vote on the bill first.

Full story

Filed under: Auto Bailout • Congress
soundoff (52 Responses)
  1. Meka


    December 6, 2008 12:11 pm at 12:11 pm |
  2. John

    Bankruptcy is the only responsible answer. Failed companies do that.

    December 6, 2008 12:22 pm at 12:22 pm |
  3. Tom in CA


    Let any or all of the BIG 3 file for Chapter 11 Bankruptcy and be forced to reorganize. This is the only way that they can get out of their contracts with the auto dealerships (so they can reduce the number of product lines they carry – GM = Chevy, Pontiac, GMC, Buick, Cadillac, Saturn, etc., Ford = Ford, Mercury, Lincoln, etc.), and reduce their labor costs and their benefit costs.

    It's time for them to bit the bullet now – not later.

    December 6, 2008 12:25 pm at 12:25 pm |
  4. Race to the Bottom

    Why bother to put"Add a comment" under these Saturday posts when they are deleted or ignored completely later?Guess you just want people to waste time looking at your paid ads.Well I wont look at them then and make sure I never buy the products if I do.

    December 6, 2008 12:26 pm at 12:26 pm |
  5. What???

    Americans are saying 61-39% that they do not want a bailout of Detroit.
    So what the heck is Pelosi doing????

    Giving money to the Big 3 is like giving drugs to an addict. They won't reform and they'll be back for more.

    December 6, 2008 12:27 pm at 12:27 pm |
  6. Walt, Belton,TX

    Ah, her re-election campaign contributions finally came in!

    December 6, 2008 12:35 pm at 12:35 pm |
  7. Lawrence M Ramos

    The big three have nothing to offer me. Where have they been spending their r&d money? I want an electric vehicle i can use everyday as a commute vehicle. They have been in the oil companies pockets for so long, now they are paying for it. My next car is going to be an Aptera.

    December 6, 2008 12:38 pm at 12:38 pm |
  8. Ron Ft. Myers

    Did anyone doubt that they would get the money? This exercise of questions and grilling was nothing more than a front for us commoners. The main question is who is goiing to monitor this hand out? It can't be the Rep. or Dems., as our "leaders" in the two parties have already proved that they are incompenent, even more so than the 3 CEO's. Is the money going to be used to keep the plants going or to finance the retiree's pension/healthcare benefits? You can take this to the bank, this money will be washed down the drain and they will be back for more! The CEO's need to be replaced and so do all our worthless politicians, starting with Barney "Rubble" Frank.

    December 6, 2008 12:42 pm at 12:42 pm |
  9. Giving Ohio a Fish

    So once this is done.....

    Is it Un-American to purchase a toyota,? because wrecks the investment of taxpayer money?

    ie.....if I invest in Coca cola then i lose money every time I buy a Pepsi.

    Is the new Admin going to mandate all Americans buy a GM or Ford or Chrysler to see this investment pan out?

    Does that mean, in reality, the we the people now own the auto industry too? and as consumers we are shackled to their success?

    This is bad......all the way around


    Invest the billions in the re-training of the states auto workers....

    thats what its all about anyway......

    Invest in the People of America!!!!!

    You're giving a man a fish! (feeding him for a day at the expense of the village}

    Please choose to "Teach a man to fish" (investing in a man which benefits him, is family and the village}

    December 6, 2008 12:53 pm at 12:53 pm |
  10. Franky

    "Help may soon be on the way to the struggling U.S. auto industry after House Speaker Nancy Pelosi backed off her opposition to using funds from a fuel-efficiency research program for a bailout, two congressional officials said Friday."

    You know, I also think that's the best move. Plus, where is the fuel-efficient program going? Is not like is going anywhere else and I am with the GOP on this one. Plus, my boy is gonna be sworned and maybe his administration will have an idea how they wanna balance and use some funds in the future. Yes, fuel-efficient is important but we are just at the beginning not the end. Steps can be taken to secure the program and be researched but I'm gonna tell you right now that program is gonna take a while, I mean big while. The fact that we are investing is good but for the long term and when the new administration gets in, they can work on it and trust me, not only will conservatives will be satisfied with the "O-line"(Securty team), liberals should also be happy that energy cna make a difference. Maybe not in 2 or 4 or 6 years but it'll definitely leave the train in this administration...

    In other words be smart, I shouldv'e just said that, LOL!!

    December 6, 2008 12:54 pm at 12:54 pm |
  11. jack

    The flood gates are starting to open. Now "ALL" business's, industries, and individuals should get in line to ask congress for "loans" to bail themselves out.

    How do you determine which is worthy of saving?

    By the number of jobs an industry and related business contribute to the GDP?

    In America it has always been about competition, compete or close up shop. For too long Detroit ignored the competition from foreign car makers. It's time to pay the piper.

    December 6, 2008 01:07 pm at 1:07 pm |
  12. The Rector

    wow, just in time for the holidays too. I was afraid that all those execs wouldn't get their x-mas bonus this year. glad to see the govmnt still looking out for their friends... the corporations.

    December 6, 2008 01:12 pm at 1:12 pm |
  13. Robert Bird

    It is absolutely essential that Congress extend loans to the Big 3 auto
    industry for the economic health of our country. They are facing a "perfect storm" of the credit crisis, recession, comsumer confidence, etc.
    They are the backbone of our manufacuring economy with approximately one in ten jobs tied to this industry. These are family sustaining jobs and if lost, would be nearly impossible to regain.
    Our citizens must realize that we are all tied in together in the US economy and our buying habits affect each other's well being.
    We all do well when we all do well.

    December 6, 2008 01:17 pm at 1:17 pm |
  14. Michael, Mattydale, NY

    I agree with many people that some of the decisions the Big 3 have made have been poor decisions like building gas guzzlers. However, I do not see how Congress can bailout financial institutions with no conditions set on them and no real results from it and then say no to the Big 3 for a bailout. The auto industry has serious problmes because wages are too low and jobs are being lost and costs continue to rise so it isn't surprising that they are suffering. If it were up to me I would give them conditional money, including taking back money from the fianancial instittions because they have done nothing to help nad have made the problem worse and give money to the big 3 for specific things like wages for each new hire, money for each car developed that gets over 100mpg including added incentives if they give the cars to people, regardless of their income, at a specific percentage of their income so that everyone can han buy from them.

    December 6, 2008 01:26 pm at 1:26 pm |
  15. shay

    Thank You, Thank You, Thank You.

    This is so much needed. There is so much at stake.

    Some people are one check away from being homeless. They are holding on with a thread. This will give autoworkers and others some hope.

    Big Three need to improve management, inspection, customer service, and cut down on cost whenever possible. Stop stockpiling and do on time delivery. Producing quality vehicles is the no 1 on the list, do it right the first time so you do not have to do it the second time and not just base it on quantity alone.

    Customer service will make you are break you. Improvement is a must. Make a reasonable compensation if the product is not right. As they say if you don't use it you lose it .It is how you treat your customer. Take extra steps to return customers calls to make sure they are satisfied with the vehicle. Some are first time buyers and some are not. CEO need to make themselves available when the customer have taken all the necessary steps to get the vehicle right .As long as the customer money is green don't treat them like they are a nobody because you want them to come back again.

    Word of mouth of a good vehicle goes a long way.

    They have a long way to go but they can do it.

    As my grandparents use to say it is easy to be irresponsible than to be responsible. Being irresponsible does not take a lot of work but being responsible does.

    December 6, 2008 01:42 pm at 1:42 pm |
  16. alreadytiredofit

    Why doesn't the government just buy GM for the $3 billion their stock is worth instead of giving them $17 billion. A fool(ish) government and it's money are soon parted – oh wait, the government is us!

    December 6, 2008 01:42 pm at 1:42 pm |
  17. MK

    I wish the people of Pelosi's district in CA would not re-elect her when she runs again.

    December 6, 2008 01:43 pm at 1:43 pm |
  18. gary n.

    @ The Rector

    I doubt very much that there will bonuses this year. Or for a long time to come.

    December 6, 2008 01:49 pm at 1:49 pm |
  19. AdamW

    DO NOT BAILOUT THESE CROOKS! I don not want my tax dollars going to crooks who can't run a business properly. Let them fail!

    December 6, 2008 01:50 pm at 1:50 pm |
  20. Race to the Bottom

    I take it a lot of the folks that make rash judgements on here still live with mommy and daddy at home and listnen to Rush Limbaugh etc. all day and night.That or they are paid company bloggers always looking to slander someone.

    December 6, 2008 02:01 pm at 2:01 pm |
  21. clifford

    Let's not forget that some of the same polititians criticizing the U.S. auto industry (Shelby from Alabama) are the same ones who gave the foreign transplants billions of are tax dollars to build here! The foreign owned auto companies have already received there bailouts on the front end!! And the U.S auto companies only build those big gas guzzleing SUV'S because that's what you and I wanted when gas was cheap. And as a barrel of oil contiues to drop we will want them again! That's the American way isn't it??

    December 6, 2008 02:11 pm at 2:11 pm |
  22. Sal

    how about that, the Democrats have the power in Congress and in the White House and they still roll over to the Republican's demands, using money from the fuel efficiency program, the lack of the Big 3's fuel efficiency program helped get them in this mess in the first place. pathetic.

    December 6, 2008 02:13 pm at 2:13 pm |
  23. chris @ stl

    Glad to see that the commonsense is prevailing and that something is being worked out to help the workers of auto industry. It doesn't matter from where the money is coming from – Tarp, DOE, or economic stimulus, etc. What is important is that the companies get help as soon as possible and prevent the bleeding. Any delay in action get matters worse, and it would take more to help them out. The cost had already increased from 25 b to $34 b within 2 wks. That's how the market reacts .... we need some certainty and quick action .... now wishy washy or wobbling.

    December 6, 2008 02:17 pm at 2:17 pm |
  24. Alice Newman Center Harbor NH

    So little for the auto makers and so much for Wall Street!

    Wall Street was not grilled, did not have to present a plan for the future, complained about any regulations, and has no accountability. Their CEO's continue to hold lavish meetings at ritzy resorts, have the same salaries and will get their usual millions of dollars in bonus money for their "top" people ... the ones who screwed up!

    Compared to the Big 3, who are working for $1.00 this coming year, with no other stock options etc, who were grilled (rightfully) who presented a plan, who welcomed Government Oversight and set a date certain to accomplish their goals, Wall Street and the Banks are nothing but a pack of thieves ... they are just sitting on all the money: our money.

    I know the GOP loves "trickle down" but if the auto makers are allowed to fail, no one is going to like what trickles down ... let's all just plan on moving right from the deep recession into a real economic Depression.

    Wall Street failing never risked 3,000,000 people losing their jobs.

    December 6, 2008 02:24 pm at 2:24 pm |
  25. Robert W. English

    bailout?what about bailling out us,the people! who's money is it eny way?I say give every adult $150.000.and let us buy the cars we want,let us pay off our own house,let the banks come to us.we know whats best for us not some one els.what will we do with the money you say?spend it whats wrong with that!?

    December 6, 2008 02:39 pm at 2:39 pm |
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