Press Conference with Congressional Democratic Leader Subject: Auto Industry Bailout

Press Conference

SEN. REID: Democrats are determined to help auto workers and the very important auto industry. We know that the industry, the auto industry, is the heart of our nation's manufacturing sector.

We've worked hard this week to fashion a bipartisan consensus. No one has worked harder on the Senate side than the senators from Michigan. They have a bipartisan agreement, but it's their agreement.

Unfortunately the sad reality is that no one has come up with a plan that can pass the House and the Senate and get signed by President Bush, no matter how hard Senator Levin and the others have worked, and they've worked very, very hard.

The main reason is what we've all witnessed in the congressional hearings this week. The executives of the auto companies have not been able to convince the Congress or the American people that this government bailout will be its last.

In light of the importance of this issue, to all of us, we have decided, the best way to proceed is to give the auto companies another opportunity to make their case, make their case to Congress and to the American people.

We're requesting that they submit a plan to Congress, through Chairman Frank and Chairman Dodd, no later than December 2nd. These two very able men will review the plan and if necessary hold hearings, during the week of December 2nd, to fully vet the auto industry's proposals.

We're prepared to come back into session, the week of December 8th, to help the auto industry, but only if they present a viable plan that gives us, the Congress, the confidence that taxpayers and the auto workers will be well served.

In the meantime it's important, we remind everyone, that right now or any time in the future, the administration, this administration has the authority -- with the money they have, from TARP, or with the Federal Reserve -- to provide all the resources, with any strings attached to it that they want, to give these companies the help they need.

The key is accountability and viability. That's what we're asking. That's not too much.

Madame Speaker?

REP. PELOSI: Thank you very much, Mr. Leader. I wish to associate myself with your remarks, because I think that you have clearly laid out what the challenge is to our economy, to this auto industry and to Congress as we go forth.

It is all about accountability and about viability. Until we can see a plan where the auto industry is held accountable and a plan for viability on how they go into the future -- until we see the plan, until they show us the plan, we cannot show them the money. And that is really where we are with this.

I want to join my -- the chairman in saluting those who have worked so hard on this and add to that our Michigan delegation -- I said chairman -- Mr. Leader -- our Michigan delegation in the House of Representatives.

The auto industry is very important to our country. It is essential -- its survival is essential to our -- maintaining our industrial and manufacturing base. That industrial base is essential to our national security. So for reasons of our national security, for reasons that relate to the financial -- the health of our financial community and for reasons that relate to the needs of our working -- the workers who have been affected by this, it is essential that we see some restructuring, some path to viability from the industry.

As the leader addressed that -- what that meant in the timetable -- I know Leader Hoyer will address that, as well, so I won't go into that. But again, we reject those who are advocating bankruptcy for the industry. We reject that. But we do want to work together. And I don't think we saw too much -- very much in the hearings of the last few days that gave us the confidence that we could act upon it legislatively. Hopefully, in another week or two we will see a plan that can take us viably into the future with accountability to the American people before we spend another dollar of their tax dollars.

Thank you, Mr. Leader.

SEN. REID: Senator Dodd?

SEN. DODD: Thank you, Senator.

And I'll look forward to working with Barney Frank and we'll plan on holding hearings in that week that you suggested, Leader and Madame Speaker. And maybe we can do it together. I'll talk to Barney on how to proceed, but clearly, between now and then, we'd like to hear the ideas. And if they make sense and if they've met the criteria the leader and the speaker have laid out, then we'd like to move forward and be of assistance.

SEN. REID: We'll be happy to take some questions.

Q Madame Speaker? Madame Speaker?

SEN. REID: Yeah?

Q I'm a little confused, because, Madame Speaker, you had endorsed the idea of helping out the automakers with money from the financial bailout's $700 billion.

SPEAKER PELOSI: Right.

Q So what's different about simply using this money -- you know, the Department of Energy money -- and then replenishing it in January, and compromise --

SPEAKER PELOSI: Well, it's different in this respect: The Department of Energy money was for a specific purpose. That is money that is the advanced manufacturing technology initiative on how we go into the future. Let's see what their plan is. And then -- we're not talking today about what money would be used; we're talking today about the need for accountability and the need for a -- for viability.

I don't think there are votes in the -- I can only speak for the House -- for any of these plans, based on the --

SEN. REID: Today you can speak for the Senate, because there aren't the votes there.

SPEAKER PELOSI: -- to go forward with any of these plans, until people see more accountability and the prospect of viability in those industries.

Q (Off mike) -- using the $700 billion?

SPEAKER PELOSI: I don't think -- well, the White House won't sign that. And I don't think it would pass the Senate.

Q Mr. Leader?

SEN. REID: Yes.

Q Doesn't this sound a little bit what Congress did back in September when Mr. Paulson propounded the 700 billion (dollars) -- this proposal, and then here you're asking the automobile industry to send up their proposal and then adjudicate this? Isn't that a little dangerous, based on what happened -- (off mike)?

SEN. REID: I frankly don't understand what you mean, but I'll try to be better informed, and let's see what I can do.

When the -- they came to us with the problems with the financial sector, we responded and responded very quickly. That is now going forward. They spent about 250 billion (dollars) of the 700 billion (dollars), and we hope it's headed in the right directions. We have been told it is, as slow as it is.

Now, what we have said to the automobile industry is, we need you to be part of what we're doing here. We think it would send a terrible message to the workers, where -- you know, we all can throw all the barbs we want at the three people that fly down here in their corporate jets, but we're concerned not about them. We're concerned about the hundreds of thousands and millions of people that are involved in the automobile industry who want these jobs and need these jobs. And we want them to have the jobs.

We want them to work, as we've indicated, and come up with a proposal that we can get through here on December 8th.

Remember, one of the things that we'll be looking at, of course -- and you know, we'll let the -- let those who are working on coming up with the proposal -- we don't know how much money they need to -- for the so-called bailout. That's one of the things they have to come up with, because now -- it's been very elusive as to what that is.

But the model used by Secretary Paulson is hopefully not what we're doing here, but it's a -- it's a variation of it. We just want to make sure there is accountability and there is viability and we don't have that yet. And we don't need to go through a bunch of votes here that fail. We think the American workers are too important to let this fail. We want to help, but we can only help if they're willing to help themselves.

Q Madame Speaker, what do you say to the voters of Michigan? Earlier today, John Dingell was dumped as the chairman of the Energy Committee and now the auto bailout arrangement that's been worked out by the senators from Michigan has been put on ice. Do you still have their interests at heart, the voters of Michigan, given everything that's happened today?

REP. PELOSI: Well, not only the voters of Michigan, but the people of Michigan and the people of our country. We're trying to have a viable auto industry. We recognize how important that industry is to our financial community as well as to our military and our national security. So we're there to have it be viable. It is not on the road to viability now.

These two issues, I think, are separate. The House of Representatives worked its will in terms of who would be chairman of the committee, but that's one subject. This is another subject.

But let me just say one thing about what Harry was speaking about. This -- this is about taking us to a path of positive viability and accountability. We're not on that path right now. It just keeps getting more and more -- and I will say this. When last we met with the CEOs, the three CEOs, which was -- what, a week ago, Steny? -- the week before, they had called us and said: We want to talk to you about supporting a merger within the industry.

So I said, well, come in and see us. By the time they came in and -- to see us, they then were talking about: No, we're not really talking about that now. We're talking about liquidity.

We need an infusion of cash so that we can get through the next while.

And then we put together some challenges, proposals, that said we can only put forth money if we know at the end of the day that we're on a path to viability and accountability for this money to the -- so now they -- when they've come in, we haven't gotten that clarity of what this path is.

We're saying: Okay, you -- we know you must be working on this. Have it for us in the next week and a half. The chairmen of the committee, Mr. -- Chairman Dodd and Chairman Frank, will take it up as before their committee, and then we'll see what Congress -- how Congress will work its will.

What this is about -- (cross talk) -- this is about sustaining the -- this is our response to those who will say: Let them go. Let them go and then deal with it after that.

No, we're saying this is an important industry in our country. We intend to save it. We can only do so if we work together, and the auto industry has to come up with its plan for innovation, accountability and viability.

(Cross talk.)

Q Madame Speaker --

SEN. REID: Let's have one a time here, folks. Yes?

SPEAKER PELOSI: Dana?

Q Mr. Leader --

SEN. REID: Yes?

Q -- with respect, how is this not kind of Congress avoiding your responsibility to find compromise and so instead basically kicking the can down the road and saying it's up to the auto industry and it's not --

SEN. REID: Well, I --

SEN./REP. : It's giving us time to -- (inaudible) -- of that.

Q (Off mike.)

SEN. REID: I say just the opposite. The markets are -- the stock markets, the credit markets are having a lot of difficulty. What kind of a message do we send to the American people by having a bunch of failed votes here? We do not have the votes.

What happened here in Washington this week has not been good for the auto industry. I know it wasn't planned, but these guys flying in their big corporate jets doesn't send a good message to people in Searchlight, Nevada, or Las Vegas or Reno or any place in this country. We want them to get their act together. We want them to come up with something. We are here to help. We're not against the auto industry. We want to help those people keep those jobs. And yes, we're kicking the can down the road because that will give us the opportunity to do something positive. But that will only happen if they get their act together.

SPEAKER PELOSI: Yeah, but we have a responsibility to the taxpayer to make sure that the dollars that we spent are well invested. They have to show us the plans.

Mr. Hoyer?

REP. HOYER: I just wanted to add, I said to the speaker, this is an opportunity for us to build consensus and instill confidence. And it is a demonstration that we intend to keep working on this matter because we believe it's critical. We're going to be working next week and the week after. The automobile companies are going to be working next week.

We expect the administration to be working, as well. And we're going to come back to this at a time when, hopefully, we will have built consensus and Senator Reid and Speaker Pelosi and the rest of the leaders will be able to forge the votes to take positive action.

Q (Off mike.)

REP. FRANK: Could I say it's clear to me, in the minds of the media, Congress can operate at one of two speeds: either way too slow, or much too fast. And if we were to pass this right away, I could write the stories for tomorrow: "In a rushed, barely examined commitment of many, many more taxpayer dollars, Congress today leapt into an abyss." (Laughter.)

Look, here's the facts. We have -- (off-mike comments and laughter.)

(Off mike) -- copyright.

Here's the context. We put through a bill committing $700 billion of taxpayers' money at risk, although we hope to recover it. The context is this. There is widespread dissatisfaction -- not just in the Congress, but in the country -- with what is perceived to be a failure of the recipients of those funds to carry out the intent that the Congress had. There is a sense that we did not do a good enough job of safeguarding the use of those funds, of providing prevention against abuse. And you could not get, I believe, through either house of Congress today what some people might think was a repeat.

That's why we need to take time, because you already have a great deal of skepticism, on the part of the public, on the part of the Congress and in much of the media, that we acted too quickly and didn't do enough to anticipate problems.

I think it is very important that we move here. We had a hearing yesterday. The Democrats were, on the whole, very supportive. But given this context, it has to be done in a careful way, and two weeks cannot be the critical difference. So to avoid the problems that we now face and to deal with the skepticism, the deep skepticism about doing these things, it is essential that we take the time to make sure that we have anticipated the kind of problems that many people think arose because we gave too much discretion the last time.

Q (Off mike.)

SEN. REID: Okay, no, we have a question here.

Q How are you going to define viability for the automakers? I mean, given their concerns about revealing confidential plans, how much - (off mike)?

SEN REID: We're not here solving a math problem. We're here solving an economic problem that faces our country. And we're going to use our experience. And that's why we, the speaker and I, wanted to make sure that the people who've been involved in this longer than anyone else -- that's Dodd and Frank -- are going to be instrumental in coming up with a program that is viable (and ?) there's accountability there.

So we're not going to be here today with exactitude. We're here telling the American people that we're going to -- we've joined hands to do what we can to help the auto industry, but we can only do that if they help themselves.

STAFF: Thanks, everybody.

END.

For questions and comments contact FNS via WEB or by phone: (800) 211-4020 or (202) 347-1400
Please read FNS Security and Privacy statement before using this website.
Copyright © 1985-2008, Federal News Service, Inc. All rights reserved.

Source