House Democrats consider aid plan for auto industry
The $25-billion rescue package would provide low-interest loans to automakers for the development of fuel-efficient cars and mean more jobs in key election battlegrounds.
WASHINGTON — House Democratic leaders are considering a $25-billion rescue package for the auto industry as part of an effort to bolster the sagging U.S. economy. The aid proposal, with its clear political implications for key battleground states, is likely to be put on a legislative fast track, possibly clearing Congress in a matter of weeks.
"This is very, very important. It's an important industry in our country," House Speaker Nancy Pelosi (D-San Francisco) said. "It's about jobs. Jobs, jobs, jobs, jobs."
Coming just days after the Treasury stepped in to bolster housing and financial markets with a takeover of mortgage titans Fannie Mae and Freddie Mac, the Democrats' proposal reflects a new readiness in Washington to intervene in economic trouble spots. It also is a sign of the intensifying effort by presidential candidates in both parties to woo voters in the battered but politically pivotal states that are home to the auto industry -- especially Michigan and Ohio.
Democratic leaders said they had not yet decided whether to include the aid plan -- which would come in the form of low-cost government loans focused on helping Detroit develop more fuel-efficient vehicles -- in an energy bill or in a broad new economic stimulus package.
"The best bill to include this in is the bill that has the best chance of getting passed," said Greg Martin, Washington spokesman for General Motors Corp.
But the proposal drew immediate fire from some budget hawks. Sen. Jim DeMint (R-S.C.) said: "Washington's misguided bailout of the mortgage industry has sparked a run on the federal Treasury, and taxpayers simply can't afford it."
President Bush, arguing that the $168 billion in checks mailed out to taxpayers over the summer was sufficient, opposes any broad new stimulus plan. But White House officials said they were willing to work with Congress, which adjourns its fall session in three weeks, on aid for Detroit.
"We're aware of the issue and will look at it with Congress," said a senior administration official who requested anonymity when discussing legislative strategy. "Obviously, when there is a proposal to provide taxpayer support for private companies, we will want to make sure all consequences are seriously considered."
On Tuesday, Democratic presidential nominee Barack Obama campaigned in Michigan, while Republican John McCain stumped across Ohio. Both are promising federal help for a region and an industry in crisis.
- SUVs Would Have to Improve Gas Mileage Under Bush Plan Dec 13, 2002
- Kerry Energy Plan Calls for Tougher Fuel Rules Jun 13, 2003
- Easing of Auto Fuel Economy Rule Upheld Jun 07, 1988
