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Congress Gives Automakers Homework

STEVE INSKEEP, host:

Congress did not give car makers the bailout that they pleaded for in Washington this week. Instead, lawmakers asked the car makers to do some work. They demanded a plan for long-term survival before they will consider any more financial help. In other words, show us the plan, and we may show you the money. NPR's David Welna has the story.

DAVID WELNA: All this week's lame-duck session of Congress really got done was a $6 billion expansion of unemployment benefits. Senate Majority Leader Harry Reid pulled the plug on voting for a much-debated $25 billion auto-industry bailout. Instead, Reid gave auto-industry executives until December 2nd to present plans to Congress showing just how the auto industry intends to survive.

(Soundbite of speech, November 20, 2008)

Senator HARRY REID (Democrat, Nevada; Senate Majority Leader): We're prepared to come back in to session the week of December 8th to help the auto industry, but only if they present a viable plan that gives us , the Congress, the confidence that taxpayers and autoworkers will be well-served.

WELNA: And confidence, Reid said, was not exactly what the big-three auto-industry executives who testified before Congress had inspired.

Sen. REID: What happened here in Washington this week has not been good for the auto industry. I know it wasn't planned, but these guys flying in their big corporate jets doesn't send a good message to people in Searchlight, Nevada, or Las Vegas or Reno or any place in this country.

WELNA: Added to that public-relations fiasco is another problem pointed out by House Financial Services Chairman Barney Frank. It's widespread dissatisfaction with the $700 billion financial-services bailout, which Frank himself helped push through Congress.

(Soundbite of speech, November 20, 2008)

Representative BARNEY FRANK (Democrat, Massachusetts; Chairman, House Financial Services Committee): So, to avoid the problems that we now face and to deal with the skepticism, the deep skepticism, about doing these things, it is essential that we take the time to make sure that we have anticipated the kind of problem that many people think arose because we gave too much discretion the last time.

WELNA: But by kicking the car-industry bailout can down the road another couple of weeks, Democrats are taking the political risk of angering organized labor, one of their most important constituencies. House Speaker Nancy Pelosi insisted that she really is acting in the best interest of car makers and autoworkers.

(Soundbite of speech, November 20, 2008)

Representative NANCY PELOSI (Democrat, California; Speaker of the House): We're trying to have a viable auto industry. We recognize how important that industry is to our financial community as well as to our military and our national security. So, we're there to have it be viable. It is not on the road to viability now.

WELNA: That was no consolation, though, to Ohio Republican Senator George Voinovich. He wanted the Congress to stay in session to approve a rescue for the big three.

(Soundbite of speech, November 20, 2008)

Senator GEORGE VOINOVICH (Republican, Ohio): If we don't get this done and they do go under, I believe that we're going to have a deep recession, and quite frankly, from what I can pick up, we may just go over the cliff.

WELNA: Voinovich was part of a bipartisan group of senators from car-making states who crafted the bailout plan, redirecting $25 billion that Congress has already approved to help car makers retool to become more fuel efficient. Michigan Democrat Carl Levin prefers that plan, because it would only require car makers to reveal their survival strategies when applying for federal loans.

(Soundbite of speech)

Senator CARL LEVIN (Democrat, Michigan): What the auto industry is going to need to do, because of the decision of the leaders here, is instead of presenting that plan after enactment - if we could have gotten this passed - to the secretary of Commerce with their application, they're going to need to present that two weeks from now, approximately, to the Congress and to the committees.

WELNA: And the clock is now ticking. David Welna, NPR News, the Capitol.

(Soundbite of music)

INSKEEP: You're listening to NPR News. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

David Welna is NPR's national security correspondent.
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