Pelosi Says House Will Take Up Plan to Help Automakers

[Mrs. Sharon B. Hodge]

Pelosi Says House Will Take Up Plan to Help Automakers
By Lori Montgomery
Washington Post Staff Writer

The House will convene next week to vote on a plan to provide emergency cash to the nation's battered automobile industry, House Speaker Nancy Pelosi (D-Calif.) said today, but it was unclear whether a federal bailout for the automakers could win support in the more closely divided Senate or from the White House.

In a written statement issued this afternoon, Pelosi said that because the failure of one or more of the Detroit automakers "would have a devastating impact on our economy, particularly on the men and women who work in that industry, Congress and the Bush Administration must take immediate action."

The debate over additional government aid to the automakers has become more urgent in recent days. General Motors, in particular, is facing a dire financial situation, and analysts fear a possible bankruptcy. Earlier this week, President-elect Barack Obama urged President Bush to approve immediate aid to the automakers, but the White House has not committed to doing so.

Pelosi said she has asked Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee, to work with lawmakers from both chambers and the Bush administration to include the automakers in the Treasury Department's $700 billion economic rescue program, which was originally designed to stabilize the U.S. financial system. Congressional Democrats want to use $25 billion from the Treasury program as a bridge loan for the car companies intended to help them survive the sharpest drop in auto sales in two decades.

The cash would come with the same restrictions placed on other participants in the Treasury program, Pelosi said, including limits on executive compensation, a ban on golden parachutes and other "taxpayer protections to ensure that any companies that benefit from this assistance -- and not the taxpayers -- bear the full burden of repaying any costs that are incurred."

"It is essential for the domestic automobile manufacturing industry to re-emerge as a global, competitive leader in fuel efficiency and in new, path-breaking energy-efficient technologies that protect our environment. For the automobile industry to be truly viable, it must continue to move in this direction," Pelosi said, adding that she is "confident Congress can consider emergency assistance legislation next week during a lame-duck session."