GOP Must Do Its Share for Big Three Automakers

By Daily Editorials

December 8, 2008 4 min read

Republican senators should weigh carefully whether they want to be responsible for the government standing by and doing nothing while the domestic auto industry collapses.

Congressional help for the Big Three automakers now appears to hinge on convincing six more Republican senators to get behind the loan package.

Michigan Sen. Debbie Stabenow said Sunday the Senate wouldn't free up the loan money without the support of 12 Republicans, and right now only six are on board.

This is getting absurd.

This is the same Congress that wrote the financial markets a $700 billion check with only minimal hearings and without fully understanding how the money would be used.

When Wall Street faced collapse, help was rushed through with few questions asked and no conditions attached.

But for some reason, the automakers' request for $34 billion in loans to keep them operating until the credit markets ease is being held to a far different standard.

But just like with the Wall Street bailout, the economy is on the line.

Economists agree that if the domestic automakers fail, it will send the nation into a much deeper and longer recession. Up to 4 million workers could lose their jobs.

Do the Republicans really want to take that risk?

The White House and Democratic congressional leaders have agreed on freeing up $15 billion in loans already earmarked to develop fuel-efficient vehicles.

It's not enough, but at least it gives the automakers some breathing room.

There's no good reason not to release money that has already been targeted for the industry.

The automakers have done everything Congress has asked. Ford Motor Co., General Motors Corp. and Chrysler LLC submitted detailed recovery plans that will radically restructure their businesses.

And yet the executives of those companies are still being accused of having their "heads in the sand," as President-elect Barack Obama said on NBC's "Meet the Press" Sunday.

Obama implied that some auto executives ought to lose their jobs, but didn't say which ones.

Sen. Chris Dodd, D-Conn., was more specific, telling CBS' "Face the Nation" that GM's Chairman and CEO Rick Wagoner ought to resign.

It is understandable that members of Congress would want to attach safeguards to make sure taxpayers don't get stuck with bad loans.

But they should stay within reason. Wagoner is the author of a good turnaround strategy, and still has the confidence of his board of directors.

Losing him at this point could well leave GM in even worse shape.

Congress should trust that Wagoner can execute the plan he has submitted. Demanding heads for the sake of political cover is counterproductive.

The automakers need help from Congress, but they don't need Congress running their companies.

It shouldn't be forgotten that the Big Three are in this predicament largely because of the credit crisis, and Congress bears considerable responsibility for that crisis.

End the partisanship, the grandstanding and the game playing.

These companies are vital to the American economy. Give them the help they need.

REPRINTED FROM THE DETROIT NEWS.

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