It looks like Republicans may be able to foil the narrow Democrat majority in its quest to dole out money to the first in a list of private companies making bad business decisions that should be rewarded with your tax money:
House Republican leader John Boehner, Richard Shelby, the top Republican on the Senate Banking Committee, and Alabama Representative Spencer Bachus, have all criticized aspects of the aid package being crafted by Democrats in the House and Senate.
"I don't know of a single Republican who is willing to support'' the auto bailout, Democrat Christopher Dodd, chairman of the Senate Banking Committee, said yesterday, adding that he would be careful about bringing up any measure that might fail.
General Motors Corp., Ford Motor Co. and Chrysler LLC would receive $25 billion in loans out of a $700 billion financial bailout package approved earlier this year under the legislation, which Representative Barney Frank of Massachusetts and Senator Carl Levin of Michigan are writing. The Bush administration opposes using those funds for the auto companies.
The finer print reveals several less-encouraging quotes from Republicans, who sound far too willing to approve a bailout if the money has certain strings attached:
"Spending billions of additional federal tax dollars with no promises to reform the root causes crippling automakers' competitiveness around the world is neither fair to taxpayers nor sound fiscal policy,'' Boehner said in a statement yesterday...
"The financial situation facing the Big Three is not a national problem, but their problem,'' Shelby said in a statement this week. ``I do not support the use of U.S. taxpayer dollars to reward the mismanagement of Detroit-based auto manufacturers in such a way that allows them to continue and compound their ongoing mistakes.''
Chuck Grassley has asked top auto executives to cut their own pay until the crisis is averted, and Rep. Spencer Bachus (R-Ala.) has suggested any bailout money be tied to automakers' ability to renegotiate labor contracts.
Complicating the Dems' problems: Obama resigns his Senate seat on Nov. 16, decreasing their majority, and the bill would likely need enough support to withstand a presidential veto.
If Republicans can stand up to the Washington pressure to do this, they're likely to come out on the right side of this issue, according to numbers from Rasmussen:
Forty-six percent (46%) of Americans are opposed to a taxpayer-backed bailout of the Big Three automakers. Thirty percent (30%) support such a plan, and 25% are undecided.
A near identical percentage (45%) are opposed to a specific government bailout for General Motors, which says it is facing bankruptcy in the near future without an infusion of federal aid. Thirty-five percent (35%) of Americans support a GM bailout, with a sizable group (20%) not sure.
A whopping 73 percent are worried the government will run out of money if it keeps bailing companies out, recognizing that there's likely no end in sight once GM gets the goods. If Republicans need more incentive to oppose this, there's the fact that women are more worried than men, and younger Americans more than older Americans. Good government is the most attractive part of the Republican message right now, and it's an inroad to groups Republicans lost this time around.
Dan Mitchell of Cato disputes the notion Democrats are selling that this is the requisite bailout of Main Street required after the bailout of Wall St.:
Bailouts are a particularly bizarre form of redistribution, however, because the corporate bureaucrats at the Big Three are among the very richest Americans. The UAW bosses make extravagant salaries, as well, and even regular union workers make an average of approximately $70 per hour, far higher than the average American.
Bankruptcy may be the quickest path to profitability, painful though it is. A court-supervised opportunity to streamline production and costs would undoubtedly make union bosses and executives uncomfortable, but it's what they need to do to become viable in the long term. BMW, Nissan, and Toyota all make money making cars in the United States. Most of them do it in South Carolina and Alabama, where workers have been glad to trade insurance-covered massage therapy for steady jobs working for companies that aren't constantly on the verge of collapsing.
