Progress Made in Bailout Plan for Big 3 Automakers

WASHINGTON (AP) - A bailout plan for the failing U.S. auto
industry could include a Cabinet-level oversight board and a
provision to withdraw the money if the overseers decide the
companies are failing to take steps to overhaul themselves.
The plan would draw the emergency aid from an existing loan
program meant to help the automakers build fuel-efficient vehicles.
The size of the package hasn't been finalized, but it is expected
to be about $15 billion, several congressional aides said.
It would create a board composed of Cabinet secretaries from the
departments of Treasury, Energy, Labor, Commerce and Transportation
plus the Environmental Protection Agency administrator to oversee a
broad auto industry restructuring. A congressional aide outlined
the emerging measure on condition of anonymity because it is not
yet completed.
In return for the money, the carmakers would have to agree to
terms similar to those placed on banks that receive funds under the
$700 billion Wall Street bailout: to limit their top executives'
pay packages, cease paying dividends, give the government a chunk
of future gains and guarantee that taxpayers would be reimbursed
before any other shareholders, the aide said.
The bill under discussion would place the special investigator
overseeing the bank rescue in charge of keeping tabs on the auto
The White House and Democratic congressional leaders are
narrowing their differences over the auto bailout, but had yet to
agree on specific legislative details, officials said.
Sen. Chris Dodd, D-Conn., chairman of the Banking Committee,
said Sunday that General Motors Corp.'s chief executive, Rick
Wagoner, "has to move on" as part of a government-run
"I think you have got to consider new leadership," Dodd said
on CBS' "Face the Nation."
On Monday, Dodd said that "it's not my job to hire and fire,
but what I suggest is, you need to have new teams in place here ...
if you're going to convince the American public" that the
financial relief plan is necessary and justified.
Dodd also said on ABC's "Good Morning America" Monday that
figures showing over a half-million people lost their jobs in
November amounts to a "game-changer" in the debate over an aid
UAW President Ron Gettelfinger, appearing on NBC's "Today"
show, said his union is ready to go back to the bargaining table to
help the auto companies, but he also said that workers should not
be made "scapegoats" for their problems.
Criticized for staying on the sidelines until now,
President-elect Barack Obama voiced support Sunday for the bailout
legislation being drafted in Congress. He accused car industry
executives of a persistent "head-in-the sand approach" to
long-festering problems.
In an appearance on NBC's "Meet the Press," Obama said
Congress was doing "the exact right thing" in drafting
legislation that "holds the auto industry's feet to the fire" at
the same time it tries to prevent its demise.
GM spokesman Steve Harris said the company appreciates Dodd's
support for the loans, but added, "GM employees, dealers,
suppliers and the GM board of directors feel strongly that Rick is
the right guy to lead GM through this incredibly difficult and
challenging time."
Associated Press auto writer Tom Krisher in Detroit and writer
Philip Elliott in Chicago contributed to this report.

(Copyright 2008 by The Associated Press. All Rights Reserved.)

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