Thank you for contacting me about ongoing efforts in Congress to aid the ailing U.S. automotive industry .
Although the decline in the U.S. market share held by General Motors, Chrysler and Ford began many years ago, several additional factors, including the spike in gasoline prices last summer and the constriction of credit resulting from the global financial crisis, have brought the industry to the verge of bankruptcy. At jeopardy are thousands of jobs in assembly plants, parts manufacturers and suppliers, repair shops, and dealerships, as well as significant revenues for local governments and other industries such as advertising. The Center for Automotive Research has estimated that the automotive industry directly employs more than 30,000 workers in Maryland , and approximately 80 percent of those jobs are at new car dealerships.
Having weighed the consequences of inaction, I firmly believe that the federal government must provide the assistance necessary to help the automotive industry not only survive, but also recover and thrive in the coming years.
On November 17, 2008, Senate Majority Leader Harry Reid introduced S. 3688, legislation to provide the companies with loans of up to $25 billion. These funds would have come from the $700 billion already authorized by Congress in the Troubled Asset Relief Program passed by Congress as part of the Emergency Economic Stabilization Act of 2008. Because that bill did not garner sufficient bipartisan support to move forward, the auto industry leaders were instructed to present to Congress specific restructuring plans detailing how taxpayers' funds would be used to ensure their companies' long term viability.
Drawing upon the companies' testimony and recommendations presented in early December, the House passe d H.R. 7321, the Auto Industry F inancing and Restructuring Act, which would have provided up to a $14 billion line of credit to General Motors, Chrysler, and Ford to help them continue to operate in the near term. The bill would use funds that have already been allocated for auto companies from Section 136 of the Energy Independence and Security Act.
In order to be eligible for any taxpayer-backed assistance, the companies would be required to adhere to rigorous terms and conditions, including; being required t o pay interest at rates profitable to the U.S. government; being prohibited from paying bonuses or "golden parachutes" to their top executives; being prohibited from paying dividends on common stock; and, being required to provide warrants to the government, ensuring that taxpayers will benefit from any future growth the companies might experience. In addition, they would have to devise a long-term strategy by March 31, 2009 to repay American taxpayers, to become competitive internationally, to return the company to profitability, to streamline costs, and to produce advanced technology vehicles and new products.
On December 11, I voted with a majority of the Senate to move forward with consideration of H.R. 7321, but unfortunately , the required 60-vote threshold was not met, and the legislative season ended without passage of this bill.
In the final days of 2008, the Administration took steps within its authority under TARP to rescue the vital industry. On December 19 , President Bush announced a plan that would give General Motors and Chrysler $17.4 billion. The plan called for an immediate infusion of $13.4 billion in emergency loans from the Treasury Department's financial system rescue fund, with another $4 billion to be provided in February to General Motors if the remainder of the bail out funds are released. President Bush also set a date of March 31, 2009 for the companies to make sweeping changes, and said that the loans would be called at that point if the Obama Administration did not consider the companies to be on a path to profitability.
As the 111 th Congress begins working with the new Administration to bolster the American economy, please be assured that I will continue to support efforts to aid the U.S. auto industry and its workers. Thank you for contacting me with your views on this matter.
Although the decline in the U.S. market share held by General Motors, Chrysler and Ford began many years ago, several additional factors, including the spike in gasoline prices last summer and the constriction of credit resulting from the global financial crisis, have brought the industry to the verge of bankruptcy. At jeopardy are thousands of jobs in assembly plants, parts manufacturers and suppliers, repair shops, and dealerships, as well as significant revenues for local governments and other industries such as advertising. The Center for Automotive Research has estimated that the automotive industry directly employs more than 30,000 workers in Maryland , and approximately 80 percent of those jobs are at new car dealerships.
Having weighed the consequences of inaction, I firmly believe that the federal government must provide the assistance necessary to help the automotive industry not only survive, but also recover and thrive in the coming years.
On November 17, 2008, Senate Majority Leader Harry Reid introduced S. 3688, legislation to provide the companies with loans of up to $25 billion. These funds would have come from the $700 billion already authorized by Congress in the Troubled Asset Relief Program passed by Congress as part of the Emergency Economic Stabilization Act of 2008. Because that bill did not garner sufficient bipartisan support to move forward, the auto industry leaders were instructed to present to Congress specific restructuring plans detailing how taxpayers' funds would be used to ensure their companies' long term viability.
Drawing upon the companies' testimony and recommendations presented in early December, the House passe d H.R. 7321, the Auto Industry F inancing and Restructuring Act, which would have provided up to a $14 billion line of credit to General Motors, Chrysler, and Ford to help them continue to operate in the near term. The bill would use funds that have already been allocated for auto companies from Section 136 of the Energy Independence and Security Act.
In order to be eligible for any taxpayer-backed assistance, the companies would be required to adhere to rigorous terms and conditions, including; being required t o pay interest at rates profitable to the U.S. government; being prohibited from paying bonuses or "golden parachutes" to their top executives; being prohibited from paying dividends on common stock; and, being required to provide warrants to the government, ensuring that taxpayers will benefit from any future growth the companies might experience. In addition, they would have to devise a long-term strategy by March 31, 2009 to repay American taxpayers, to become competitive internationally, to return the company to profitability, to streamline costs, and to produce advanced technology vehicles and new products.
On December 11, I voted with a majority of the Senate to move forward with consideration of H.R. 7321, but unfortunately , the required 60-vote threshold was not met, and the legislative season ended without passage of this bill.
In the final days of 2008, the Administration took steps within its authority under TARP to rescue the vital industry. On December 19 , President Bush announced a plan that would give General Motors and Chrysler $17.4 billion. The plan called for an immediate infusion of $13.4 billion in emergency loans from the Treasury Department's financial system rescue fund, with another $4 billion to be provided in February to General Motors if the remainder of the bail out funds are released. President Bush also set a date of March 31, 2009 for the companies to make sweeping changes, and said that the loans would be called at that point if the Obama Administration did not consider the companies to be on a path to profitability.
As the 111 th Congress begins working with the new Administration to bolster the American economy, please be assured that I will continue to support efforts to aid the U.S. auto industry and its workers. Thank you for contacting me with your views on this matter.
Beazer's Opinion:
Okay folks. . . there you have it. My question to you is what has happened to this Country? Did our citizenry forget why we fled Socialist England from the outset?
And what about the bailout for the Barbers, Beauticians, Morticians, Carpenters, Electricians . . .and yes let us not forget about even the toilet paper manufacturers. One would think that 'What's good for the goose should be good for the gander.' Talk about Discrimination!
Where is our Supreme Court? What has happened to very fabric, foundation, and guiding principles that formed this nation. Why is it that GM, Chrysler, and Ford should have dominion on US assets that we are suppose to share equally. Talk about Equality!
What else can I say. . . is there not any minutemen left in this nation to oust such scoundrels as the one noted above?
What a sad state of affairs in what can be classified as one of Americas darkest days.
I contacted the Senator about my opposition to the "bailout" of the big three automakers and yesterday, I received the exact, same email.
ReplyDeleteNothing will stop it but violence, war is on the horizon. Me personaly,"Im locked and loaded".
ReplyDelete"The Center for Automotive Research has estimated that the automotive industry directly employs more than 30,000 workers in Maryland , and approximately 80 percent of those jobs are at new car dealerships."
ReplyDeleteThis is like saying a Real Estate Sales Rep is part of the construction industry.
A few points....
ReplyDelete"Did our citizenry forget why we fled Socialist England from the outset?"
Socialism wasn't formed as a coherent political philosophy until the early 1800s, about 50 years after the American Revolution. In the 1770s, The British Empire was a constitutional monarchy.
"And what about the bailout for the Barbers, Beauticians, Morticians, Carpenters, Electricians . . .and yes let us not forget about even the toilet paper manufacturers. One would think that 'What's good for the goose should be good for the gander.' Talk about Discrimination!"
Had there been a single (or small number) of employers of those occupations, they may well have been bailed out. We couldn't allow a situation where every electrician was suddenly unemployed due to their employer's bankruptcy, could we?
"Where is our Supreme Court? What has happened to very fabric, foundation, and guiding principles that formed this nation. Why is it that GM, Chrysler, and Ford should have dominion on US assets that we are suppose to share equally. Talk about Equality!"
Where is SCOTUS? Sitting on its hands, where it has been since it turned conservative in the 1980s. If you're waiting for SCOTUS to stand up for the little guy, you really haven't been paying attention for the last 30 years.
"What else can I say. . . is there not any minutemen left in this nation to oust such scoundrels as the one noted above?"
And whom would you attack with such a militia force? An army needs a target.
"What a sad state of affairs in what can be classified as one of Americas darkest days."
Really? A proposed government LOAN to make sure GM and Chrysler don't go under and take 3 millions direct and related jobs with them? More dark that 9/11? More dark than Pearl Harbor? Really?
This loan is less than 1% of the money already doled out to the financial companies. LESS THAN ONE PERCENT. And yet, automakers, with their 10% of product costs in labor, are reamed, while Morgan Stanley, whose employees are almost 75% of their expenses, are given a free pass. Explain, please.
Re: duck around
ReplyDeleteMaybe you should of thought about another vocation other than the American car industry.
I've never met you, but you seem to have a lot of hostility.
As for myself, I want what is entitled to every taxpayer, his just dues. GM, Chrysler, Ford, are getting theirs, where is mine?
I'm with Beezer.
Beezer...you ever been duck hunting?
ReplyDeleteI hear they make good soup.
lots of em around.
you can find em almost everywhere