Members of Congress and President Bush have reached an agreement to provide $15 billion dollars worth of government loans to Detroit’s big three automakers.
Members of Congress and President Bush have apparently reached an agreement to provide $15 billion dollars worth of government loans to Detroit's big three automakers. This is far less than the $25 billion dollars that was originally requested and much smaller than the $34 billion that the CEO's requested during the past two days of testimony on Capitol Hill.
The breakthrough came when Democratic Speaker of the House, Nancy Pelosi, gave into the President's demand that the funding come from an earlier aid bill that offered the automakers $25 billion dollars for retooling and creating more energy efficient automobiles. Next week both the House and Senate will take up the proposed legislation and according to expectations it should sail through both chambers of Congress and reach the President's desk shortly thereafter. The quick passage of the legislation should help to insure that the big three will have the money within a matter of weeks.
However there are details that still need to be worked out. In a statement released by Pelosi she stated that "Congress will insist that any legislation include rigorous and ongoing oversight to guarantee that taxpayers are protected and that resources are directed to ensure the long-term viability and competitiveness of the American automobile industry." Officials from both political parties have also agreed that the legislation should include the creation of a new bureaucracy to insure the funds are used for their intended purpose.
The $15 billion dollar aid package is expected to allow the big three to last until March of 2009, by which time President-elect Barack Obama and the new Congress will have been sworn in.