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Republicans, Democrats debate over fund source for auto sector

Republicans, Democrats debate over fund source for auto sector
PTI
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First Published: Mon, Nov 17 2008. 11 41 AM IST
Updated: Mon, Nov 17 2008. 11 41 AM IST
Washington: The outgoing 110th US Congress is likely to witness another debate between the Democrats and the Republicans during its lame-duck session on Monday to discuss the source of funding $25 billion in loans to rescue the staggering auto industry in Detroit.
The Bush administration has made it clear that it is not averse to helping the three auto giants - General Motors, Ford Motors and Chrysler LLC - but opposed the proposal of Democrats who have been insisting that the account of $700 billion financial bailout package approved by the Congress can be utilised for this purpose.
One feeling inside and outside the Capitol Hill is that the House of Representatives under Speaker Nancy Pelosi may be able to get the rescue package of $25 billions but the Chairman of the Senate Banking Committee has not got even a single Republican supporting the idea of the auto funds coming out of the bailout package.
“Spending billions of dollars of additional federal tax dollars with no promises to reform the root cause of crippling automakers’ competitiveness around the world is neither fair to taxpayers nor sound fiscal policy,” said Congressman John Boehner, the Minority Republican leader in the House from Ohio what has a huge automotive component.
Some opposition to the idea has also come from the conservative Democrats who among other things have said the language for the $25 billion is not indicated in the bailout package.
“Right now, I don’t think the votes. I don’t know if a single Republican is willing to support, so I want to be careful about bringing up a proposition that might fail,” remarked Connecticut Democrat Dodd.
But the Republicans are even more pointed in their opposition to the idea.
The administration point of view came from the Commerce Secretary Carlos Gutierrez who told CNN that the money for the auto industry cannot come from the financial bailout package.
“If you start that, where do you stop? There’s a line of companies of industries waiting at Treasury just to see if they can get their hands on those $700 billion. That is for the financial system, it’s to stabilise the financial system and that should not be used...,” Gutierrez said.
Meanwhile, there is a strong political sentiment that the top executives of the auto industry cannot expect a free ride without some significant oversight as well as on the higher limits of compensation to the top management cadre.
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First Published: Mon, Nov 17 2008. 11 41 AM IST
More Topics: Auto | Democrat | Republican | US | Bailout |