Bailout of Big 3 pushed
Michigan's congressional delegation is mounting a major push to help Detroit's Big Three automakers get about $27 billion in federal aid over the next five years. The behind-the-scenes efforts come amid growing concerns about the fate of the struggling domestic automakers. General Motors Corp., Ford Motor Co. and Chrysler LLC are paring back salaried staff, closing plants and dramatically cutting expenses at a time when the economy is in turmoil and auto sales could hit their lowest level in 17 years.
Many Michigan congressional members think that if they don't start a concerted effort now to win significant financial support for automakers, it will be harder to do so later. Some of the proposals under consideration are the most generous considered since the 1979 Chrysler bailout, though they face long odds from a largely skeptical Congress.
The chiefs of staff and top auto policy aides to most of Michigan's 17-member congressional delegation met privately Friday to discuss a broad set of policies to help the industry. The meeting was organized by the office of Rep. John Dingell, D-Dearborn, chairman of the House Energy and Commerce committee, which has jurisdiction over many auto issues. Topics included subsidies to cover one-third of automakers' losses, government-issued loans, loan guarantees and bigger tax credits for the industry and consumers.
The Detroit News obtained a one-page summary of the proposal discussed at the meeting that calls for $5 billion in direct loans over five years; $3 billion a year for five years to help speed the retirement of 1.5 million older, less efficient vehicles; and $2 billion over five years in tax breaks for advanced vehicles.
The group also called for $800 million over three years to develop an "advanced battery trust fund" to help build three domestic battery manufacturing facilities and for working in 2009 to block California from being able to impose its own emissions standards. Detroit News