Media Stakeout with House Speaker Nancy Pelosi (D-CA) and Rep. Barney Frank (D-MA)

Press Conference

SPEAKER PELOSI: (In progress.) I guess it's getting to be evening.

We are in -- as you know, for the past few days -- in conversations about how we go forward with a package for the auto industry that produces at the end of the day -- and that means very soon -- a viable industry for our country. It is an industry that is important to our economy, to our industrial base. There are workforce concerns that, again, are important to our country. And we want to be able to review the performance of the auto companies as we go forward. In order to do that, it's important for us to pass legislation that will set criteria for restructuring and reorganization of that industry and the companies within it.

I'm going to defer to the chairman of the Financial Services Committee, who's been engaged in the negotiations, which are continuing. Thank you, Barney, for your leadership on this important issue.

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SPEAKER PELOSI: But I think that it's important also to note that unless the restructuring that is called for in this legislation and the goal of viability is achieved by March 31st, there is no justification for spending any more taxpayer dollars to -- as a loan or in any other way.

Now, (as has ?) been said, this is a loan of $15 billion because it's a different purpose under 136; 136 is for innovation. This is a bad choice that we have to make. We should be able to use TARP money. The White House doesn't want to do that, so we have to use money that is designated for an innovative purpose. The CBO has said for a different purpose that is riskier you can't spend as much money, and that's why it's $15 billion.

It may take more than $15 billion to get to March 31st, but come March 31st it is our hope that there will be a viable automotive industry in our country, with transparency and accountability to the taxpayer. We think that is possible. We think that is possible.

But if they don't meet the conditions of restructuring and the rest, there's not going to be an endless flow of money to this industry to continue, left to their own devices, the practices they have been engaged in.

So while they reevaluate their relationships -- we call this the barbershop. Everybody's getting a haircut here, in terms of the conditions of the bill. If -- labor has to take a haircut because of concessions and expediting concessions; bondholders have to take a haircut as to what they -- the return on the dollar is for them; shareholders have to take a haircut; there have to be -- reconsideration of relationship with dealerships, with suppliers; and the management itself has to take a big haircut on all of this.

So we'll see how willing everyone is to go into the future, but we want to recognize the importance of the automotive industry to our country. Its survival is important to our economy. If they cannot survive, then we have to make an evaluation of the leadership of that industry as well, because we will not give up on our automotive industry. It's just a question of how it is manifested and how it is led.

So I'm very encouraged by the conversations so far. We're on a path. I would only support using 136 with the assurance that it will be -- we'll get it back in a number of weeks. And in fact, if in a number of weeks the automotive industry -- the Big Three are not on a path to viability, we may want our money back sooner than March 31st, instead of over the longer term that would be built into the bill, should they be going -- again, accountability, viability; a thriving, competitive, innovative automotive industry for the future.

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