The U.S. House of Representatives Wednesday evening passed a bill that promises to provide $14 billion in aid to U.S. automakers. The measure passed 237 to 170, due largely to Democratic dominance of the House. Just 32 Republicans voted in favor of the bill. But it’s not home free for the Detroit Three yet. The bill still has to pass the Senate, and Republican opposition there could prevent passage.
The $14 billion figure represents what appears to be the bare minimum for the Detroit Three to continue operations. GM has said it needs $4 billion by the end of December and $6 billion in the first quarter of 2009 to avoid bankruptcy. Chrysler says it needs $4 billion by the end of the same timeframe to stay afloat. Ford , which remains relatively healthy financially, is not expected to need bailout dollars at this time.
There are serious doubts as to whether the bill can pass the Senate, which has a more even ratio of Republicans to Democrats. 205 of 225 House Democrats voted in favor of the bill, or roughly 91 percent. Just 18 percent of Republicans — 32 of 182 — were in favor of the measure.
If a similar 91 percent of Senate Democrats and 18 percent of Senate Republicans vote in favor of the bill, it would be able to “pass” with roughly 52 out of 100 votes. But the real magic number is 60 of 100, which is the only way to prevent the gridlock of a filibuster. Even if independents Bernie Sanders and Joe Lieberman vote in favor of the plan, proponents would still be 6 votes short of a true victory.
All of this probably means more negotiating between Republicans and Democrats — including possibly integrating components of the alternate proposal unveiled by House Republicans Wednesday afternoon.
Even if the bill passes in its current form, it’s possible the Detroit Three will need further assistance in 2009. GM says that will depend on whether industry sales continue to slow — a factor impacted by credit availability, jobs, and overall economic conditions. Ford was seeking a multi-billion-dollar credit line that it would only tap if the industry takes a turn for the worse. Future aid will rest with the Obama administration and the new Congress in early 2009.
