[Updated - 2:45 p.m.] A bipartisan group of U.S. senators today announced they have agreed in principle to provide emergency loans to the Big Three U.S. automakers, but only if those companies can come up with a detailed plan that explains exactly how the money will be used, and why it will work long-term. Senate Majority Leader Henry Reid and House Speaker Nancy Pelosi said they have decided to forgo any vote on current proposals, and instead give the automakers up to two weeks to come up with a solid strategy. The goal is to put a bailout bill to vote on December 8th.
The agreement was engineered by Michigan Democrats Carl Levin and Debbie Stabenow, as well as Ohio Republican George Voinovich and Missouri Republican Christopher Bond. But Reid and Pelosi want to see a detailed plan.
“The decision has been made by the leaders to bring us back on December 8th after there have been some hearings on the plan,” said Sen. Levin.
“We want them to come up with a proposal we can get through here on December 8th,” Reid said, reiterating Levin’s remarks. “We don’t know how much money they need and that’s one of the things they need to come up with.”
“Until they show us a plan, we cannot show them the money,” said Pelosi. “Hopefully in another week or two we can see a plan.”
“We reject those who are advocating bankruptcy for the industry, we reject that,” said Pelosi.
“We are here to help,” explained Reid during the press conference Thursday afternoon. “We’re not against the auto industry.” Rather, “we intend to save it,” he said.
But Reid cautioned help will only come “if they get their act together.” By “they,” Reid means the U.S. auto executives. Both Reid and Pelosi said the automakers have not been forthcoming about what they really need, and their story is continually changing. Pelosi said one week GM was looking for funds to facilitate a merger with Chrysler , and the next week the auto giant said it was need of liquidity for ongoing operations. Pelosi cited a “lack of clarity,” from the Big Three.
“The key is accountability and viability,” Reid said. “That’s all we’re asking. It’s not too much.”
“This is about taking us to a path of positive viability and accountability,” said Pelosi. She cited national security and financial stability as the primary reasons for a bailout.
Various proposals are being floated, including fast-tracking the $25 billion originally set aside for alternative energy research and retooling. Other ideas include taking fund from the $700 billion bailout intended for the financial sector.
Pelosi said she disagrees with redirecting green energy funds. “Any effort to divert funds is a step backward in assuring the viability and competitiveness of the US auto industry,” said Pelosi.
