White House to consider using finance bail-out for carmakers (Extra)

Washington - The White House on Friday said it would consider using funds from the 700-billion-dollar financial rescue to bail out ailing carmakers after a plan to save the industry failed in the US Congress. 'It is disappointing that while appropriate and effective legislation to assist and restructure troubled automakers received majority support in both houses, Congress nevertheless failed to pass final legislation,' White House spokeswoman Dana Perino said in a statement. A last-ditch effort to pass an emergency loan that would resuscitate the ailing US car industry fell apart late Thursday after negotiations collapsed in the Senate, causing a wave of financial gloom to ripple through world markets on Friday. After hours of bargaining, Republicans and Democrats failed to agree on a compromise deal. The bone of contention was the powerful United Auto Workers (UAW) union's refusal to agree to Republican demands for wage cuts and reduction in labour costs to the level of Japanese competitors operating in the US. The White House had pushed for the 14-billion-dollar rescue plan from funds already appropriated for carmakers to develop greener vehicles and had stressed the financial industry bail-out was not to be used for other industries. However, the Bush administration reversed course after that deal fell through, saying it would consider other options such as dipping into the financial fund known as TARP. 'Under normal economic conditions we would prefer that markets determine the ultimate fate of private firms. However, given the current weakened state of the US economy, we will consider other options if necessary including use of the TARP program - to prevent a collapse of troubled automakers,' Perino said. 'A precipitous collapse of this industry would have a severe impact on our economy, and it would be irresponsible to further weaken and destabilize our economy at this time.'

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Mr. TDec 12th, 2008 - 20:21:03

The president has to be out of his mind if he goes in to the fray to bail out the auto giants in this scenario. With the UAW betting on a bailout son that they can maintain their grip on the auto industry work force, it would be the ultimate hypocrasy. The UAW was asked to help with concessions, just like everyone else and they balked. The govt. should not bailout a failing business (as a rule). The only argument in favor of doing so is to keep workers in their jobs. If the UAW, representing those workers, refuses to play ball, then it should go under. The UAW members should also be ineligible for unemployment since they are the ones that stopped the rescue plan.

I do have a suggested alternative though. Tell the big three that they can still have the help, but only if they fire every UAW member. They can hire back those that they want, unser any terms that they want, but only if they give up any ties to the union. If the UAW workers don't want their jobs back there are millions out of work who would welcome the opportunity.

If Bush does go against the will of the senate and the people and charge to the rescue then he should be removed from office and lose his pension.

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