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Bush to Detroit: Drop Dead!

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"Bush to Detroit: Drop Dead!"

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Here is a post from one of our favorite guest bloggers, Daniel J. Weiss, Director of Climate Strategy at the Center for American Progress Action Fund. It first appeared at the WonkRoom this morning.

pic.jpg George Bush’s deep unpopularity, lack of a positive agenda or accomplishments, and his waning days in office have sapped most of his presidential powers save one: the ability to say “no.” His intransigent opposition to long term bridge loans to save General Motors, Chrysler, and Ford has forced Congressional leaders to scramble to provide assistance to prevent bankruptcy, which would devastate the already ailing economy. It appears that there is a tentative deal that will keep GM and Chrysler on life support until the new president and Congress can provide long-term assistance to nurse them back to health.

The possible deal would loan GM and Chrysler up to $17 billion from the Advanced Technology Vehicles Manufacturing Incentive Program, established by Sec. 136 of the Energy Independence and Security Act. This program provides up to $25 billion in loans to retool factories so that they can produce more efficient vehicles that meet new fuel economy standards. Already, the Big Three and smaller innovative start up companies are seeking these funds.

Speaker Nancy Pelosi opposed using these funds for the bridge loans because they are supposed to jump start efforts to build significantly more efficient cars. Taking this money would only delay this critical effort, slowing American companies’ efforts to win the race to build the super efficient cars of the 21st Century.

November’s shocking unemployment figures of another half million people out of work made it imperative that GM and Chrysler avoid bankruptcy. Speaker Pelosi acted responsibly to provide the only solution that Bush and conservative lawmakers would accept:

“Congress is considering various short term funding options for the American automobile industry. We will not permit any funds to be borrowed from the advanced technology program unless there is a guarantee that those funds will be replenished in a matter of weeks so as not to delay that crucial initiative. Regardless of the source, all funding needs will be tightly targeted with vigorous supervision and guaranteed taxpayer protection.”

This weekend, Congressional leaders will hammer out the conditions for the loans.

These restrictions should include protection of workers and retirees health care and pensions; limits on executive compensation; independent oversight; commitment to continue research, development and production of significantly more fuel efficient cars; and, an agreement that the Big Three will cease their legal and lobbying efforts to block or weaken motor vehicle fuel economy or greenhouse gas standards. Congress could vote on the deal the week of December 8th.

Hopefully, the Department of Energy will not halt the Advanced Vehicle loan program. Its funds could be replenished in January 2009 as part of an economic stimulus package designed to save and create jobs. This bill could also include the additional bridge loan funds necessary to save and rejuvenate the auto companies. The 111th Congress — with more progressives and fewer conservatives — will consider such a bill shortly after it is sworn in on January 6th. This essential economic relief package would then go to the new president, who will do more than just say “no.”

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15 Responses to Bush to Detroit: Drop Dead!

  1. Bob Wallace says:

    It’s a good approach.

    The present administration has failed at almost everything they’ve attempted. You name, they’ve made it worse.

    Putting on a temporary patch that will get us someplace where there is competent help isn’t a bad idea at all.

    Obama’s crew and the members of the next Congress will have a couple of months to do some deep thinking without the pressure of having to do something “right now!”.

  2. groweg says:

    The current economic crises springs primarily from the Democratic mandated imperative to provide unqualified people housing loans. So Bush is not to blame for this economic downturn.

  3. Kathy N. says:

    Bush really is the most evil kind of man. Just this week he was doing interviews to re-write the history of his term in office with Rowe’s help of course. Putting a positive spin on his time in office. YA RIGHT!! He can’t be that stupid really can he?? Refusing to take any blame for the mess he’s made of our country while doing midnight legislation to collapes the country futher, maybe he just think’s we are to stupid to follow his right hand while keeping his left clearly in view. It’s a sad commentary on what’s important to the man that swore to protect this country above all other concerns.

  4. Jon says:

    When will we finally be able to recognize a rip-off when we see/hear it? I agree that the US auto industry needs to be focused on efficiency, reducing the impact on global climate, and everything else Climate Progress stands for. But to expect, or even have a distant hope, that the industry will attend to those things without being literally FORCED into it, well – that’s some good ganja, man. Read the following quote, and then remember that Chrysler was bailed out soon thereafter. What did we get from that bailout? Squat and grunt, that’s what…

    “Over the past year, the domestic auto industry has experienced sharply reduced sales and profitability, large indefinite layoffs, and increased market penetration by imports … The shift in consumer preferences towards smaller, more fuel-efficient passenger cars and light trucks … appears to be permanent, and the industry will spend massive amounts of money to retool to produce the motor vehicles that the public now wants.

    To improve the overall future prospects for the domestic motor vehicle manufacturers, a quality and price competitive motor vehicle must be produced … If this is not accomplished, the long term outlook for the industry is bleak.”

    — Source: THE U.S. AUTOMOBILE INDUSTRY, 1980. REPORT TO THE PRESIDENT FROM THE SECRETARY OF TRANSPORTATION

    My 1979 Toyota Corolla got better gas mileage than ANY US made car in 2008. For that matter, I still own a 1990 Celica that gets an average of 37 mpg… Cerberus, who owns a major chunk of (51%) GMAC and 80% of Chrysler today, refused this month to help either company, expecting (probably correctly) that the US govt will fork over the cash. (GMAC was among the top 6 sellers of SUBPRIME SECURITIES in 2006, and is one of only 2 remaining from that top 6 group. The other player still standing? Goldman Sachs.)

    So this ‘US Auto Industry Bailout’ is really a bailout of a PRIVATE INVESTMENT FIRM: CERBERUS CAPITAL MANAGEMENT, who have seen their investments go down the tubes this year.

    Sorry about the rant Joe, I am just tired of seeing all this cash go to the very guys who created the mess in the first place. The cash should be going to FIX the mess, not reward the guys who started it.

  5. paulm says:

    Could this be the first country to capitulate directly as a result of Climate Change?

    Kyrgyzstan: Energy/Water/Food Insecurity – Nov 2008

    Kyrgyzstan faces uncertain times as winter approaches and electricity generation is so low that the government has been unable to honour a pledge to end power cuts.

    The continuing electricity shortages pose significant political risks to Bakiev and his government, both because people might come out into the streets to express their anger…

    Changing climatic conditions over the last four years have resulted in a steady decline in the amount of water reaching the reservoir.

  6. Russ says:

    Congrats Pelosi, Dodd, and your whole rotten crew. Bush has only a few days left, but you guys found one last rotten opportunity to cave in and give him what he wants.

    For good measure, Dodd and others said they believed congress didn’t actually have to authorize this, but that Bush already had the power to do it based on existing laws, either the $25 bil auto ransom or the $350 bil bank ransom.

    So we know two things:
    1. This congress will NEVER miss an opportunity to aggrandize the imperial presidency; and

    2. Those of us who knew the original “banker bailout” plan, the way it was sold to us by Dodd, Pelosi, Frank, Paulson, Bush, that whole allied crew, was a vicious lie meant to do nothing but open up a vast plunder pit into which every resource of the country could be tossed, and at which any predator interest could gorge.

    You people are aware, aren’t you, that when Carolyn Maloney demanded to know whether these criminals would now support things like the California waiver, that Wagoner repeated the old lie about a patchwork of standards? Or that when she demanded to know, If we give you beggars what you’re begging for, will you use that money to continue to sue the very people you begged it from, that they all hemmed and hawed and said they promise nothing?

    This is the most disgusting thing yet; the stench of this country now gets worse by the week.

  7. Eddie says:

    From the recent congressional testimony it seems the big three will not survive regardless of any currently discussed cash infusion.
    Let’s take the 37 Billion or so currently discussed, put an RFP on the street for new car company concepts…and fund the top 37 business plans that are submitted…each with one billion dollars. Two, three or four will hit and we’ll have our new plug in hybrids and a lot of new replacement jobs….and perhaps….single payer health insurance at the same time.

  8. Obama, Pelosi, and Reid should make it crystal clear to the automakers that if they’re getting government assistance, they WILL clean up their act, and I mean starting NOW. The Congress should stop these nonsense stop-gap measures and give them enough cash to transition to a truly sustainable – environmentally, financially, and economically sustainable – business model, starting today. It is technologically feasible to do this now; no more SUVs, no more 13 MPG pickups, no more excuses. If the current management isn’t up to it, can the lot of them – no severance packages, no executive compensation, no golden parachutes, nothing. No more rewarding incompetence.

    While we’re at it, we should put a moratorium on the sale of all non-hybrid liquid-fueled consumer vehicles, effective in 3 years’ time.

    Also, the automakers must immediately shut down all “government affairs” operations – no more lobbying of the federal or state governments, period. If they put up even the slightest resistance to these demands, they should be told to drop dead. They are in no position to negotiate, and it’s far past time our elected officials stop treating them as if they were.

  9. groweg Says:

    The current economic crises springs primarily from the Democratic mandated imperative to provide unqualified people housing loans. So Bush is not to blame for this economic downturn.

    You didn’t do too well in economics, did you? Well you’re a GOPer, so I guess that goes without saying…

  10. unhappy American says:

    You wrote “November’s shocking unemployment figures of another half million people out of work made it imperative that GM and Chrysler avoid bankruptcy. ”

    I say bullshit. It is not anybody else’s responsibility to make up for a badly run company. If these greedy bastards actually ran ethical, responsible companies, building products that Americans needed and wanted, they would not be in this position today.

    Ford for example, has a 73 mpg car, to be only marketed in Europe. Their “reasoning” (I’m being generous here) is that “American’s would not buy it” is total bullshit. Meanwhile, the executives of these companies are jet-setting around the world and living it up large at posh resorts, then they go begging hat-in-hand to our screwed up government asking for billions.

    No way. Let these bastards fail. We will only achieve what really needs to be done by trimming off all the fat. If 500,000 Americans lose their jobs, so what. Time to clean up our act by killing off the corporations that are part of the problem.

    The problem is corporate America has become bloated, greedy, inefficient, unresponsive and indifferent — and we let that happen. If we need to go through a depression to fix this, then so be it. But we’re not going to fix this by giving away money to the fat cat bureaucrats and ugly bastards that caused this problem in the first place.

    Americans are SICK to death of this kind of duplicity. I cannot believe you said that it is “imperative” that we bail them out to avoid bankruptcy. LET THEM GO BANKRUPT, THAT IS EXACTLY WHAT THEY DESERVE. Just make sure we go after these greedy bastards and confiscate all of their personal assets too, including those accounts and properties that they have hidden around the world.

  11. bob wright says:

    Anybody notice that sales of hybrids just dropped something like 30%. Is it $2.00 gas, or has everyone who could afford one already made the purchase?

    Toyota reopened the Tundra plant last month. Varoom! 6 liter 350 hp!

    GM workers and pensioners ae living like royalty compared to the rest of us “working slobs” in what is left of the manufacturing economy. Many of us will end up working at the local Big Box store for $8.00/hr. We can’t afford GM cars, other than maybe a Cobalt or some of its low end captive imports. There are more Hyundais than Chevys in the parking lot where I work and little sympathy for semi-skilled workers making $100K/year. Any bailout will have to involve givebacks from the UAW to level the playing field with Toyota and Honda.

  12. Joe says:

    Sales of ALL vehicles have collapsed — we’re in a deep friggin’ recession where it’s almost impossible for people to get credit.

  13. charlie says:

    Hybrid sales have dropped b/c the Prius sales have dropped. Number of factors there: decline of gas price, credit access and the Prius may be at the end of its fashion run (5 years is good run for a model). Also Toyota had some production issues, which hurt sales of people who need a new car today (as opposed to waiting for several months).

    Great, have the big box workers attack the unions for what is left of scraps of a decent wage. Straight out of union busting playbooks. If GM goes under, and then the associated suppliers, you big box wage is going down as well as the supply of workers flood in.

    And let’s be honest here: what is this is up in not Bush, who is irrelevant. some congressional democrats (cough, pelosi) want accountability and environment over saving jobs. Obama needs to step up and tell them who is boss, and make sure GM management is severely chastised and punished for taking their company into this situation. Chrysler needs to die as an example, and have all equity wiped out and becomes government owned.

  14. JCH says:

    “The current economic crises springs primarily from the Democratic mandated imperative to provide unqualified people housing loans. So Bush is not to blame for this economic downturn. …”

    Read this speech from 2002:

    http://www.whitehouse.gov/news/releases/2002/10/20021015-7.html

    Here Alphonso Jackson, his former neighbor from Dallas, testifies to congress on the progress of GW’s dream of building 5.5 million houses:

    http://www.hud.gov/offices/cir/test042105.cfm

  15. Rick C says:

    JCH,

    Your post is mostly complete bunk. Here’s what factcheck.org says, “As The Economist magazine noted recently, the problem is one of “layered irresponsibility … with hard-working homeowners and billionaire villains each playing a role.”

    http://www.factcheck.org/elections-2008/who_caused_the_economic_crisis.html