Friday, December 12, 2008

Senate’s Failure to Pass Automobile Bailout

As David Herszenhorn report this sad news, I have a few questions:

The Senate on Thursday night abandoned efforts to fashion a government rescue of the American automobile industry, as Senate Republicans refused to support a bill endorsed by the White House and Congressional Democrats ... So far, the Federal Reserve also has shown no willingness to step in to aid the auto industry, but Democrats have argued that it has the authority to do so and some said the central bank may have no choice but to prevent the automakers from bankruptcy proceedings that could have ruinous ripple effects … the Senate failed to win the 60 votes need to bring up the auto rescue plan for consideration. The Senate voted 52 to 35 with 10 Republicans joining 40 Democrats and 2 independents in favor ... The automakers would also have been required to cut wages and benefits to match the average hourly wage and benefits of Nissan, Toyota and Honda employees in the United States.

First of all – if only 40 Democrats voted for cloture, where were the other guys? Secondly, what is it that the Federal Reserve might do to keep the Big 3 alive until we have a new Congress and White House? Finally, when Mitch McConnell says he wants the UAW to eliminate their gap between their hourly compensation and that of those US employees of the Japanese car manufacturers, does he still (mistakenly) think that their current compensation is over $70 an hour?

Hilzoy suggests that the behavior of McConnell and his minions is not responsible. It is certainly true that some of their arguments against this bailout proposal have been dishonest.


Eleanor said...

I think the previous comment may not be meant for PGL.

I am utterly spooked by this news.

Jason said...

General Motors had offered buyouts to all of its 74,000 U.S. hourly employees. [5] Those workers could have elected to take a lump-sum payment of $45,000 or $62,500, depending on their job description, and retire with full benefits. [6]

Republican Sen. George V. Voinovich of Ohio, a strong bailout supporter, said the UAW was willing to make the cuts - but not until 2011.
is were citations are posted

Sandwichman said...

Robert Reich offers a good explanation -- that the Republicans wanted to make the bailout a vehicle for getting rid of the UAW. The UAW gives financial support to Democratic party candidates. If UAW workers are no better off than non-union workers, then why have a union? said...

Never fear, the TARP is here.

Bruce Webb said...

To answer PGLs question four Democrats did not vote and four voted against. Plus one vacancy. Even if Obama hadn't resigned and Biden showed up along with the other three MIAs they could only have gotten the result up to 57 to 35.

Which tells us a couple of things. One that the addition of 7-8 Democrats really does mean something. Two that the oft expressed claim that 41 Republicans automatically gives them the power to stop every thing every time is pretty suspect. Their party solidarity is just not as solid as some would think, they are not going to simply walk over every cliff that McConnell asks them to.

Anonymous said...

It is interesting that the UAW workers are asked to take paycuts to match the workers of Toyota etc, but how about the top brass? The pay disparity between the lowest and the highest paid here is far greater than any other country.