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Auto Bailout Includes no New Taxpayer Funds, Long-Term Restructuring
Washington,
Dec 10, 2008 -
U.S. Rep. Pete Hoekstra, R-Holland, today voted in support of a bridge loan program for the Big 3 auto manufacturers designed to include strong oversight, ensure accountability to the taxpayers and no new appropriation of taxpayer dollars.
“The bailout bridge loan program will hopefully help to prevent the Big 3 from failing and further weaken Michigan’s already unstable economy,” Hoekstra said. “Moving forward participants will need to implement long-term fundamental reforms without additional taxpayer dollars.”
The position of a government “auto czar” was included in the bill to ensure that taxpayer dollars for the bridge loans are allocated responsibly and to minimize the impact on the taxpayer. The auto manufacturers will be required to submit fundamental reform plans to the president’s designee no later than March 31, 2009.
The bailout includes a reprogramming of $14 billion of the $25 billion in low-interest loans approved by Congress in September for the Big 3 to retool older factories to produce the next generation of vehicles in America.
Hoekstra said that Congress and the auto industry need to continue to work together on creating future reforms, including incorporating into any future legislation incentives such as a tax credit on new cars to stimulate consumer demand and clear dealer inventory.
As the Big 3 work to restructure themselves, Congress could potentially help to preserve scarce financial resources by delaying new fuel economy standards and emissions requirements and guaranteeing a single national standard.
The companies and their workers, both line and management, will also need to take a hard look at making additional concessions concerning compensation and benefits for all employees.
“It is unfortunate that Washington helped to create the problem with the Detroit automakers with mandates and that they are now in need of a government bailout,” Hoekstra said. “I look forward to any future opportunities to help them again become competitive as we move further into the 21st Century and the nation recovers from the current economic crisis.”
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