FOR IMMEDIATE RELEASEDecember 3, 2008
ALLOWING AUTO INDUSTRY TO GO UNDER WOULD CREATE “BODY BLOW” TO SLUMPING ECONOMY
Borosage: Lawmakers Shouldn’t Make Automakers Victims of Their Failure to Impose Sensible Conditions on Wall Street
WASHINGTON – With U.S. automakers facing opposition for an expanded $34 billion rescue package on Capitol Hill today, Campaign for America’s Future co-director Robert Borosage said allowing the auto industry to go under would create a “body blow to the already battered economy.” Borosage noted that there’s a big difference between how lawmakers are responding to the good faith effort from the auto companies and its unions and how they dealt with the banks that caused this crisis in the first place.
The U.S. would be foolish to allow its auto industry to go under, which would be a body blow to an already battered economy. Congress should not make the auto companies the victims of their failure to impose sensible conditions on Wall Street.
Any bridge loan should be conditioned on commitments to moving towards high efficiency cars, limits on executive compensation, and oversight of global operations. U.S. taxpayers should not be subsidizing the transfer of more and more production abroad. An independent board must be set up with authority to enforce those conditions.
Much of the congressional posturing on the auto companies is displaced passion. The auto companies and its unions have come to the Congress with far more detailed plans, including concessions on CEO compensation and wrenching concessions by the unions.
The contrast between that good faith effort for a bridge loan and the ease with which the banks that have caused this crisis have garnered literally trillions of guarantees, loans and investments without any commitments on changing their business plans or on executive compensation is stark.