WASHINGTON — Hoping to prevent another blow to the economy, Democratic congressional leaders unveiled a plan Monday for propping up the U.S. auto industry that closely tracks President Bush's position -- about $15 billion in emergency loans if Detroit accepts a federal monitor to oversee operations and restructuring.
Supporters were cautiously optimistic that the plan would attract enough GOP backing to win congressional approval by the end of this week.
Under the proposal, the monitor's authority would stop short of the near-complete operational control some critics wanted the new "car czar" to have. But the official, to be appointed by the president, would negotiate far-reaching plans for restructuring General Motors Corp. and Chrysler by March 31. Ford Motor Co., which is in better financial condition, apparently would not be part of the initial outlay.
If the restructuring plans, intended to assure the companies' longer-term financial viability, are approved by the monitor, billions more in aid could be disbursed; if not, the companies would be ineligible for more money and would have to pay back the government loans they received.
The monitor would also have veto power over any transactions that exceed $25 million or that would substantially change the companies' financial condition while the government loans are outstanding. And Washington would receive ownership stakes in the companies in exchange for the loans.
The bill also would prohibit any automaker receiving government money from continuing to pursue lawsuits against California and other states to stop tough new greenhouse gas emissions standards for vehicles.
The plan, which grew out of three days of negotiations among Democratic leaders in Congress and Bush administration officials, is being reviewed by the White House, which withheld immediate support Monday night. But the specifics appear to match most of the terms Bush has been insisting on since the carmakers launched their appeal for help last month.
White House spokeswoman Dana Perino said Monday morning that Bush wanted a presidentially appointed "financial viability advisor" to negotiate with the automakers and others, such as the United Auto Workers union, about their turnaround plans. Such an advisor should have the power to review restructuring plans and release longer-term funding if the person approved them, administration officials said. Perino also said an agreement with Congress was likely.
