Fox News "What's Happening" - Transcript

Interview

MR. SCOTT: Joining us now, Representative Fred Upton. He's a Republican from Michigan and co-chair of the Congressional Auto Caucus, also a member of the House Energy and Commerce Committee; and Representative Brad Sherman, Democrat from California and member of the House Financial Services Committee. Welcome to both of you.

REP. UPTON: Thank you.

MR. SCOTT: Congressman Upton, let's start with you. You are a proponent of bailing out Detroit and using taxpayer dollars, I guess, to do so. Why?

REP. UPTON: Well, we do want to see their plan. I think it'll be instructive and constructive for the Financial Services Committee, the committee that Brad serves on, as well as its counterpart over here in the Senate to actually look at their long term and short term plan, make sure in fact that they're viable, number one.

But, you know, the alternative is we're going to let 2-and-a-half million jobs go -- go; they're just not going to be there if any of the Big Three fail. So we want to structure it in a way that the money gets paid back, obviously that there are strings on those dollars, and we're all anxious to see the plan as they will submit it literally the first week of December.

MR. SCOTT: Congressman Sherman, what do you think about that?

REP. SHERMAN: Well, I'm for giving them a bridge loan, but it can't be a bridge to nowhere. It has to be a bridge to a sustainable United States-based automobile industry. And we also need to put some real strings on the money. It's got to start with enough warrants so that the American public gets the upside of this deal. We're taking all the risk. These companies could go under.

Second, I think you need some consumer protection so that if you buy a car from GM today, some of that money goes into a trust fund to benefit your warranty. Otherwise, who's going to buy a Chevy today knowing that two years from now, their warranty may not be worth the paper it's printed on?

And then you need to deal with the executive compensation and executive perks. I've just been told that Ford has eight private jets. General Motors had five this morning; they're selling two off today. That still leaves them with three. I think these folks ought to be flying commercial as long as they need a government handout.

MR. SCOTT: Congressman Upton, we heard from the mayor of Lansing, Michigan, earlier who made an eloquent and impassioned plea for this help, but he said this was not the fault of the auto companies, that they were on the road to recovery when all of a sudden this economic crunch hit, the credit crunch hit, and they simply don't have access to money; that's what they need.

But isn't it true that they have been hemorraghing cash really for a decade now?

REP. UPTON: Well, that may be the case, but we also know that if we want to wean ourselves off foreign oil -- and I'm one that does -- that we have to build new cars. And the engineering is now -- it's almost done. We know that -- as an example, that GM Volt, the Chevy Volt, will be in the showroom as early as 2010. We know that that's going to go to the head of the class.

I've seen the Chrysler portfolio of electric hybrids, as well. All of them can be in the showroom by 2010, but they can't get there if they don't get the financing. And they were being required to provide 20 percent interest rates. Nobody can do that.

They've got to have the financing so that they can do the retooling, so that that they can manufacture the cars and get them in the showroom and build the cars that Americans want today, particularly with the -- with the energy situation the way that it is.

MR. SCOTT: Congressman Sherman, is it possible that, you know, foreign competitors are looking at this drama and saying, "Oh, man, this is crazy. Can you believe that the U.S. Congress is talking about the possibility of seeing the Big Three automakers fail?"

REP. SHERMAN: Well, we do have a lot of jobs from the foreign transplant plants that are here, but it's much better to have the cars designed in America, built in America with a very high percentage of U.S. content. And I could not imagine the governments of France or Germany or Japan allowing their industry or even one of their major companies to go under. Manufacturing's just so critical.

REP. UPTON: And I might just add, the Chinese, in fact, are going to -- it looks like they're going to provide their domestic automobile manufacturers $55 billion. The Germans are doing the same with Opal. So if we're going to compete, we have to have somewhat of a level playing field. And with other countries, in fact, providing those bridge loans so that they can stay in the future, we've got to do the same thing here, knowing that at risk is literally 2-and-a-half million jobs, jobs that we don't to lose here for good.

MR. SCOTT: Republican Fred Upton and Democrat Brad Sherman, members of Congress both, thanks.

REP. SHERMAN: Good to be with you.

REP. UPTON: Thanks.

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