[Congressional Record (Bound Edition), Volume 154 (2008), Part 18]
[Senate]
[Pages 24747-24753]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           ORDER OF BUSINESS

  Mr. REID. Mr. President, approximately 20 minutes ago the negotiation 
team broke up for purposes of having Senator Corker, who has worked 
since 2:30 this morning on the compromise, see if we could get this 
legislation over the finish line. It is my understanding he is making a 
presentation to the Republican caucus as we speak, to see if they will 
accept his compromise.
  It has been a difficult negotiation, principally conducted by 
Senators Corker and Dodd. Senator Durbin has represented me in those 
meetings.
  I am hopeful we can finish this matter tonight. I do not know what 
the odds are that the Republican caucus will accept the work done by 
Senator Corker and others but we should know soon. I am sorry it is 
8:30 at night and people have been here--I received a call from one 
Senator who has been here since early this morning and wishes to leave 
and come back tomorrow. There are other Senators who have flights early 
in the morning to go other places. They hope we could finish tonight. 
One of those other places is home. They have family waiting for them.
  I wish I could be more dictatorial and say we are going to vote right 
now, but I do not have that ability. If everyone will be patient, we 
should know within a half hour or so if they can work something out.
  We are ready to go. I think with rare exception the Democrats 
understand this is Christmas season, that there is a lot of hardship 
out there. People are losing their jobs, losing their homes, losing 
their cars, and losing their patience. We Democrats believe this 
Christmas season we do not need to pile on. If we are not able to work 
something out, 2.5 million people are going to be directly impacted and 
millions of others will be impacted. This is Christmastime and I hope 
we can give the American people a gift of hope that we are going to 
wind up with an automobile manufacturing industry that will be stronger 
and more reliable. Certainly that is our desire. We hope our friends on 
the other side of the aisle, the Republicans, will recognize the good 
work done by Senator Corker and others and finish this matter tonight.
  Mr. REED. Mr. President, I am dismayed by the turn of events that 
have occurred this evening.
  Our Nation faces economic conditions not seen in decades. By 
preventing action tonight on a plan to give the auto industry a chance 
to turn itself around, the minority is playing with fire.
  The jobs of countless workers, including thousands in Rhode Island, 
are on the line, at a time when we can ill afford more losses. 
Moreover, these companies going into bankruptcy could be far more 
costly to the federal government. And, as economist Mark Zandi 
testified before the Senate Banking Committee last week, if these 
companies are forced into bankruptcy proceedings, it would have a 
cataclysmic effect on our already fragile economy.
  The bill that Chairman Dodd and my other colleagues worked on 
diligently had the potential to give the industry a chance to put its 
house in order while preserving jobs and protecting the taxpayers. I 
regret we did not have a chance to proceed to this measure, engage in 
vigorous debate, and make a judgment on the merits.
  Mr. McCAIN. Mr. President, I have been very vocal in my support of 
the U.S. auto industry and have gone on the record saying that we need 
to do whatever is necessary to help the auto industry become strong and 
economically viable. But we need to be realistic and fiscally 
responsible in our approach to the troubles facing this and

[[Page 24748]]

other industries. I cannot support the proposal before us today. We 
simply cannot leave the American taxpayer with a tab of tens of 
billions of dollars without some serious concessions from the industry 
and some assurance of the domestic auto manufacturers' long-term 
viability, otherwise, we are just throwing good taxpayer money after 
bad business decisions.
  I have great faith in the skills, energy and ingenuity of the 
American auto worker. This crisis is not their fault. I am committed to 
making sure that U.S. auto workers are not left to fend for themselves. 
Ours is the finest workforce in the world, able to compete with anyone. 
I stand ready to ensure that Washington does its job so they can do 
theirs.
  But simply throwing money at the industry is not the way to ensure 
its long-term viability or to help stabilize our economy. As we all 
have learned in the past few weeks, the domestic auto manufacturers are 
in much worse shape than we could even imagine, with one company, GM, 
announcing they may not survive through this year without Federal help. 
But why is it that Toyota sells approximately the same number of cars 
that GM does and is profitable?
  Clearly, the automakers will need to change dramatically the way they 
do business if they hope to be on course for long-term profitability. 
Rather than seeking an unconditional handout from the taxpayer, 
industry leaders must first consider how they can restructure their 
business models in order to fix the problem themselves and build more 
competitive products--including changes in management, renegotiating 
labor agreements, and reorganizing under the bankruptcy process. And, 
they should have been doing so months, if not years, ago. And if the 
bankruptcy laws need to be changed, then the Congress should do that.
  The automakers need to prove to Congress and the American people that 
they are serious about making the changes necessary to ensure their 
long-term success before they seek further assistance from the 
taxpayer. As noted Harvard University economics professor Martin 
Feldstein wrote: ``the goal of restructuring should not just be to 
require the companies to make cars that are fuel-efficient and more 
environmentally sound . . . although that can be included in the 
government's list of requirements. The goal should be to put companies 
on a course that will allow them to survive for the long term, 
producing cars and creating jobs.'' I fully agree with Professor 
Feldstein.
  The auto industry executives, as well as many of my colleagues, have 
argued that bankruptcy is not an option. But given what we now know 
about their financial situation, why not? Shouldn't we be considering 
every option possible to allow these companies to restructure their 
operations so they can keep people employed? Chapter 11 bankruptcy was 
created precisely for the situation in which these automakers find 
themselves--where creditors' claims exceed a company's assets. It may 
be the best option. The executives leading these companies have an 
obligation to their shareholders and employees to weigh carefully that 
viable option.
  After all, filing for bankruptcy forces a company to make some very 
difficult choices and the automakers would be no exception. The 
automakers would be forced to renegotiate collective bargaining 
agreements to make themselves more competitive, to eliminate some 
dealership networks and car models that are underperforming, and to 
make other difficult cost cutting decisions regarding real estate, 
management compensation, personnel, and even office supplies. It seems 
these companies may only make these difficult decisions if they file 
for bankruptcy.
  Additionally, bankruptcy would allow the cost cutting process to 
proceed without any political interference from Congress or special 
interests. If Congress provides a bailout for these companies, there is 
no doubt that legislators will weigh in when the automakers attempt to 
renegotiate labor agreements, trim dealerships in a lawmaker's home 
State or eliminate a car model manufactured in a lawmaker's district. 
Bankruptcy will allow these decisions to be made purely based on 
financial considerations and under the supervision of a bankruptcy 
judge. Many corporations have filed for bankruptcy and emerged better 
equipped to serve consumers and face their competitors. Bankruptcy is 
not an option that should just be written off.
  Now, I would like to mention some of my specific concerns about the 
pending proposal, negotiated by the Democrats and the White House.
  My first concern I have already discussed, the fact that the 
taxpayers are asked to foot the bill upfront, almost as a first 
downpayment, without concessions or assurances of the industry's future 
viability.
  Another troubling aspect of this bill rests with the so-called ``Car 
Czar.'' Will this individual have the authority to invalidate contracts 
legally entered into by these companies? What in this legislation would 
prevent lawsuits from being filed due to nullified contracts? What is 
to prevent the next President, or the one after that, from firing this 
car czar if he or she disagrees with what the car czar seeks to impose? 
And what in the bill gives the American people any assurances that the 
companies or the car czar won't enter into other obligations that 
ultimately cost taxpayers even more money?
  I fully agree that if we are to going to provide a single taxpayer 
dollar to this industry there must be very strict oversight in order to 
protect the public's investment. Unfortunately, while this bill gives 
the President's designee some oversight authority, it has no real 
teeth. The person appointed by the President would have no real 
authority to insist on the fundamental changes necessary to promote the 
corporations' viability and protect the taxpayer's investment. If we 
are going to hand over billions and billions of taxpayer dollars, we 
should at least consider requiring Senate confirmation of an individual 
with proven business leadership skills who will serve for a defined 
period of time. This would remove the possibility of the designee 
falling victim to the political pressure often felt by those who serve 
at the pleasure of the President--allowing that person to make 
decisions based solely on the best interest of the taxpayer--not on 
political considerations.
  Another area of concern for me surrounds what seems to me a lack of 
reality on the part of the domestic auto manufacturers. More and more 
Americans want to purchase energy-saving vehicles. Yet the domestic 
auto industry seems to be fighting tooth and nail against that reality. 
And if it does not wake up immediately, nothing Congress can do will 
help the industry survive. It needs to be competitive. It needs 
customers to buy its vehicles. And it won't have many customers if it 
doesn't take action to build vehicles with higher fuel efficiency 
standards that help our Nation end our crippling dependence on foreign 
oil.
  Finally, the bill includes provisions wholly unrelated to the issue 
at hand, such as language authorizing a pay raise for U.S. judges. Why 
in the world is it necessary to address this issue in this bill? I am 
not questioning the merits of the provision--I am sure the overwhelming 
majority of our judges work very hard and deserve a raise--but such a 
provision has no business being addressed in this manner and at this 
time when so many are doing more with less. This authorization should 
be addressed in the proper way by the appropriate authorizing 
committee.
  If we allow this $14 billion to be doled out to the automakers with 
so few conditions and no concessions--who comes next? And how long 
before they return seeking billions more? A recent editorial in the 
Washington Post noted that:

     the impending collapse of General Motors presents Congress 
     and the President with a choice between two domino effects, 
     both potentially damaging to the U.S. economy if the federal 
     government does not lend GM money and the company goes 
     bankrupt, the repercussions will spread throughout the 
     country by way of the network of suppliers, dealers and local 
     businesses that depend on GM and the other car manufacturers 
     for their livelihoods. This could destroy hundreds of 
     thousands of jobs when the economy

[[Page 24749]]

     can ill afford another shock. But if the federal government, 
     frightened by these possibilities, gives GM just what it 
     wants, it will be setting a precedent for even more 
     multibillion-dollar bailouts--of automakers and of other 
     troubled companies. The closure of DHL's operation in 
     Wilmington, Ohio, is costing 9,000 people their jobs; Circuit 
     City's bankruptcy means about 7,800 layoffs. If Detroit and 
     its relatively well-compensated workforce qualify for Federal 
     aid, why not these firms and workers, too?

  We need to be very careful here lest we slide down the slippery slope 
of a taxpayer funded bailout for every ailing business in America--
large or small.
  Let me be clear. I am very sympathetic to the plight of the auto 
industry. But the proposal before us seeks to hand over $14 billion to 
companies who have yet to tell the Congress and the American people--in 
any detail--how they plan to restructure their operations and become 
viable in the long-term. Their gross inaction to date causes me great 
pause. And that is why I cannot support the measure before us.
  I am pleased to see that many are working hard to find an acceptable 
compromise. I am hopeful that we can reach a suitable agreement.
  Mr. KOHL. Mr. President, this is not a proud moment in America's 
economic history. Our once proud automakers have come to Washington hat 
in hand asking for a loan with their future, and the future of their 
workers, at stake. In exchange for a Government loan they are willing 
to submit to intrusive Government oversight, surrender their executive 
perks, and give the American taxpayer a stake in any future profits. As 
a businessman I am stunned that it has come to this.
  However, I am voting for the Auto Industry Financing and 
Restructuring Act because I want to see the American auto industry 
succeed. Under this bill, $15 billion would be provided to GM, Ford and 
Chrysler in short-term loans that will be paid back with interest. To 
avoid bankruptcy and emerge as stronger businesses, this plan requires 
the big three to submit long-term restructuring plans no later than 
March 31, 2009. If they do not then they will have their loans revoked 
and be plunged into bankruptcy. Just like other industries that are 
forced to restructure, the automakers and labor unions will need to 
make tough choices concerning benefits, wages and pensions to ensure 
their long-term viability.
  As a businessman, I am concerned about a Government appointed ``car 
czar'' who would have oversight and direct involvement over the 
operations of the automakers. I am worried that no matter how badly 
managed Detroit has been so far, a Government bureaucrat is unlikely to 
do a better job. I hope that whoever is found to take this difficult 
job has the experience, drive, and business savvy to help turn around 
this struggling industry.
  In the end I am supporting this bill because of the 46,000 well-
paying jobs in Wisconsin that are tied to the auto industry. With the 
jobs report last week stating that the economy lost 533,000 jobs in 
November alone, we can't afford to put more Americans out of work. The 
Government has already begun to help Wall Street, now it is time to 
help Main Street. I am disappointed that we were not able to agree on a 
deal tonight. I am hopeful that a bipartisan solution can be reached 
before it is too late.
  Mr. HATCH. Mr. President, one of the most renowned former Members of 
this legislative body once said ``Ask not what your country can do for 
you, but what you can do for your country.'' With bailout after 
bailout, asking what our country can do for failing companies seems to 
be the norm. Today, it appears that our Government has become the 
backstop to financing private companies to hope for long-term 
viability.
  The biggest three U.S. automobile manufacturers, Chrysler, General 
Motors, and Ford, are asking Congress to provide a loan in order for 
them to weather a recession and give them time to restructure. What we 
need to decide is not whether we will assist, but how we will assist 
the troubled auto industry. While I believe there are already some 
measures in place to assist the automakers, it would be beneficial to 
examine whether these measures are sufficient. If these measures are 
insufficient, we should look to what can be done to change our system 
so that it benefits both the auto industry and the taxpayer.
  Most Americans are asking how the big three found themselves in this 
mess. The big three are victims of a financial perfect storm. Our 
failing economy toppled an industry that was already facing stiff 
foreign competition, mounting legacy costs, government mandates, and 
poor management decisions.
  The dramatic decline in automobile sales worldwide shows that the 
decline of the big three is not solely the result of poor management. 
All auto sales, both foreign and domestic, have declined significantly 
for 13 straight months. The sales rate last month was the worst in 
nearly 30 years, since October 1982. In November, sales declined at 
rate of 36.7 percent from the same month a year ago. It was also the 
worst month on record for Asian automakers.
  Legacy costs primarily refer to a company's obligations from pervious 
years, such as costs the big three pay for health care and pensions 
under defined-benefit plans for current employees and retirees. 
Furthermore, the auto industry has been forced to pay union workers for 
shifts even when those workers are not working. It is estimated that 
the big three pay each hourly autoworker $70 an hour in wages and 
current and future benefits. In October 2005, a Detroit News article 
illustrated this burden.
  ``Ken Pool is making good money. On weekdays, he shows up at 7 a.m. 
at Ford Motor Co.'s Michigan Truck Plant, signs in, and then starts 
working--on a crossword puzzle. Pool hates the monotony, but the pay is 
good: more than $31 an hour, plus benefits.'' The article further 
explains that ``Ken Pool is one of more than 12,000 American 
autoworkers who, instead of installing windshields or bending sheet 
metal, spend their days counting the hours in a jobs bank set up by 
Detroit automakers and Delphi Corp. as part of an extraordinary job 
security agreement with the United Auto Workers union.''
  While the United Auto Workers have conceded to temporarily suspending 
the job bank and delaying payments to their retirement and health care 
funds for current and future employees, these costs have already 
burdened the auto industry. It might be too little too late. We need to 
enact measures that will ensure that the unions can no longer create 
unreasonable mandates on our auto industry. We need to ensure that 
these burdens do not persist.
  To overcome these burdens, the big three say they were already in the 
process of restructuring. Chrysler has eliminated 1.2 million units of 
capacity and reduced fixed costs by $2.4 billion. It has increased its 
manufacturing productivity by 32 percent over the past 7 years. General 
Motors has made substantial progress in narrowing the gap with foreign 
competition in quality, productivity, and fuel efficiency. In other 
markets, such as China, Latin America and Russia, GM has grown rapidly 
and outperformed the competition. Unfortunately, our failing economy 
has prevented these companies from reaping the benefits of their 
restructuring.
  The normal rules of a free market economy dictate that if a company 
runs out of money, then the company must close its doors. We have 
already changed these rules by providing bankruptcy protection. In 
ancient Greece, a banker conducted business transactions on a bench. 
When the banker could no longer lend or meet his obligations, the 
banker would symbolically break his bench. A broken bench in Latin is 
referred to as ``bankus ruptus'', which is the origin for the word 
``bankruptcy.''
  It used to be that a person who became bankrupt and could no longer 
pay his debts was considered a criminal. In the United States, however, 
bankruptcy laws were established during harsh economic times when a 
mass amount of people could no longer pay their debts. Those who were 
willing to work toward repayment of debts would be allowed to cancel 
existing debts and be protected from creditors. In the

[[Page 24750]]

1980s, an escalating number of bankruptcies inundated our courts. A 
``pre-packaged bankruptcy'' was developed to allow companies and 
creditors to submit prenegotiated bankruptcy petitions to ensure a 
timely and cost-effective bankruptcy proceeding.
  It appears that the big three auto manufacturers have severely 
cracked their bench if not already broken it. And now they are asking 
us to change the rules of a free market economy and go beyond the 
benefits of existing bankruptcy protections. They believe that a 
chapter 11 bankruptcy would worsen consumer confidence, thereby dooming 
them from the beginning.
  I am fully aware of the impact our economy could face if the big 
three go bust. It will likely trigger catastrophic damage to the U.S. 
economy, precipitating failures among component and logistic suppliers, 
other domestic car manufacturers, raw material suppliers, technology 
and service providers, retailers and their suppliers. According to a 
study by the Center for Automotive Research, an estimated 3 million 
Americans could find themselves jobless within a year of an auto 
manufacturer's collapse. We would also lose enormous improvements 
through research and development of advanced propulsion investments in 
support of greatly improved fuel efficiency, emissions reductions, and 
energy independence. It is essential that something must be done to 
halt this impact, but we need to do something carefully and something 
that will ensure the long-term viability of these companies.
  I truly believe that providing unrestricted funding to the big three 
would only delay the inevitable. I believe that the only solution is to 
provide the resources to empower these companies to consolidate and 
restructure. The majority's proposal provides temporary funding to 
allow employees, retirees, trade unions, creditors, suppliers, 
automobile dealers, and shareholders to come up with a plan that would 
be reviewed by a President-appointed designee.
  Upon review, the designee, or ``car czar,'' would determine whether 
the plan guarantees a viable long-term restructure, then the designee 
would recommend further funding. This process provides funding now and 
worries about viability later. While I am not a proponent of excessive 
government intervention, I believe that if we are going to provide any 
funding to the big three that it be conditioned upon reorganizing.
  This is not an unprecedented event. The very same issue was being 
discussed by the Senate in 1979 about whether we should provide 
financial assistance to Chrysler. Nearly 30 years ago in December, I 
stood before this body and opposed providing loans to Chrysler. Back 
then, Chrysler faced tough foreign competition and harsh economic 
times. The Chrysler Corporation Loan Guarantee Act of 1979 provided 
$1.5 billion in guaranteed loans to Chrysler. However, that legislation 
required matching private funds.
  If that amount were adjusted for inflation, it would equal more than 
$4 billion today, which ironically is what Chrysler and General Motors 
says they need to survive until next year. It is also, ironically, the 
same amount that GM spent in 2007 on health care benefits for retirees 
and active workers.
  The bill passed in 1979 and Chrysler became profitable and paid back 
these loans 7 years early with $300 million in equity returns to the 
American taxpayers. So there is the possibility that a loan to the big 
three could become profitable for American taxpayers. But we should not 
throw caution to the wind. In the past 30 years, the Government has 
never provided a financial bailout to any company other than a 
financial institution besides the airline industry after 9/11 and 
Chrysler in 1979, both heavily unionized.
  We need to move away from becoming a government of nationalizing 
failing companies toward a government that provides opportunities for 
success. We all agree that we want to see these companies prosper, but 
we disagree about how we believe this should be done. Under the 
majority proposal, we are essentially asking each and every American 
taxpayer to invest in the future of the big three without guaranteeing 
that they will survive past March of next year. This is a risky bet. I 
believe that we can reduce the risk of that bet enormously by requiring 
the big three to reorganize. Simply put, the majority does not provide 
enough assurances that the auto industry is committed to reducing 
costs. Furthermore, their proposal requires the auto manufactures to 
enter into a chapter 11 bankruptcy if their plan of long term viability 
is determined not to be sufficient. We all know this is a farce, 
because we all know that the next administration will prevent the 
necessity of filing for chapter 11 bankruptcy by giving them more 
money.
  My proposal calls for allowing the auto manufacturers and the trade 
unions the opportunity to show the American people that they are 
committed to reducing costs before the Government gives them any loan. 
Specifically, it would require that any bridge loan amount would be 
conditioned upon the amount of cost reduction concessions agreed to by 
management and labor. In order to receive a temporary bridge loan, I 
believe that these groups need to hash out a sufficient plan to show 
that they can pay back any loan amount that we provide. The auto 
manufacturers have stated that time is of the essence and they need the 
money at the end of the year. If the auto manufacturers and unions are 
really committed toward reducing costs, I believe that they can agree 
to a temporary plan by the end of the year. Time should not be an 
obstacle for Congress and the American people. In addition, I propose 
that if the auto industry's plan is deemed insufficient that they 
should be forced into a binding arbitration to avoid the obstacles of 
chapter 11 bankruptcy.
  It is hard for me to believe that the majority is really serious 
about providing a solid plan. Their leadership refuses to allow us to 
offer amendments and they have now added provisions aimed at providing 
relief to municipalities, something irrelevant to the issue before us.
  Mr. President, we are entering the holiday season with our desire to 
assist the failing auto industry. While we all wanted to provide 
positive solutions, the most powerful deliberative body in the world is 
prohibited from deliberating one of the most pressing issues of our 
time. It is unfortunate that we cannot proceed in a collaborative 
manner.
  Mr. WARNER. Mr. President, as I have mentioned, GM, Ford, and 
Chrysler have a long and heralded history in our country and its 
national security.
  There are few in the Senate today old enough to remember Pearl Harbor 
and the commencement of our military operations that followed. As one 
of those, I was privileged to serve as a 17- to 18-year-old sailor in 
the last year of WWII.
  America was victorious in WWII because of those in uniform and those 
at home supporting them--particularly the industrial manufacturing 
base. The factory floor went to war.
  At this time, I would like to have printed in the Record historical 
information outlining the contributions the auto manufacturers made to 
America's World War II war effort.

  There being no objection, the material was ordered to be printed in 
the Record, as follows:

       General Motors:
       With America's entry into World War II, no company 
     converted faster or more comprehensively to wartime 
     production than General Motors. It has been called the 
     greatest industrial transformation in history, with more than 
     200 plants in North America shifting to production of 
     airplanes, tanks, machine guns, and other military vehicles 
     and goods in a matter of months. General Motors alone 
     supplied the US forces with more than $12 billion in military 
     goods (several hundreds of billions when converted to today's 
     dollars), more than any other company.
       Ford:
       Ford Motor Company's mass production know-how was one of 
     the keys to the Allied victory.
       By August 1941, Ford was producing huge 18-cylinder Pratt & 
     Whitney aircraft engines. By summer 1942, Ford's Rouge Plant 
     was building 805 aircraft engines a month, while Pratt & 
     Whitney's plant was building only 600 aircraft engines a 
     month. In total, Ford built 58,000 aircraft engines during 
     the war.
       Most notably, Ford produced the B-24 ``Liberator'' bomber 
     at its Willow Run plant.

[[Page 24751]]

     With government support, Ford built the Willow Run plant on 
     about 1,750 acres of former farmland near the village of 
     Willow Run, between Detroit and Ann Arbor. All together, Ford 
     produced about 8,700 B-24s, nearly half of the total built 
     for the US military during the war.
       Ford also played a role in the success of the US Army Air 
     Force glider program. Ford was asked to build the gliders in 
     March 1942 and production began that December. Ford 
     eventually produced 4,400 gliders during the war.
       In addition, the US Government asked Ford to adapt its 
     aircraft engines to be used in medium tanks.
       After 18 months of research and development at Ford's 
     expense, Ford set up a production line at the Lincoln plant 
     in Detroit and began making the tank engine. Over the course 
     of the war, Ford produced almost 27,000 of these engines.
       The Army asked Ford to produce other tanks as well, 
     specifically the M-4 Sherman tank. Ford built almost 1,700 
     Sherman tanks, including more than 1,000 M-10 tanks and 
     almost 13,000 armored cars.
       The Army decided it needed a small, all-terrain vehicle, 
     and in 1940, Ford and Willys developed plans. Ford invested 
     $4 million in the program and began producing the ``General 
     Purpose,'' or ``G.P.,'' soon to be called ``jeep,'' in 1941. 
     There were 1,500 built by the spring of that year, and more 
     than 300,000 jeeps were built for the military over the next 
     four years.
       After all of the tallies were added, the most important 
     thing that Ford contributed was the know-how and experience 
     to quickly mass-produce the vehicles, aircraft, and equipment 
     which were needed to win the most important war in the 
     history of the world.
       Ford's precision in the machining of tools, and Ford's 
     ingenuity in designing an assembly line and making it work--
     these were the biggest guns in Ford's arsenal of democracy.
       Chrysler:
       Chrysler's biggest contribution to the war effort was its 
     production of the M-3 tank, the Martin B-26 bomber, and the 
     40-millimeter anti-aircraft gun. By the end of the war, 
     Chrysler had developed and produced some 18,000 tanks and 
     supplied the Allies with approximately 500,000 Dodge trucks 
     and more than $3.4 billion worth of military equipment.

  Mr. WARNER. Mr. President, hopefully, America and its Allies will 
never face conflicts that would necessitate the defense production of 
the foregoing magnitude. Further, the auto industrial base today, as it 
relates to defense work, is vastly reduced.
  But this base is the foundation of today's auto industry, which 
could, once again, play a significant role in the defense of America.
  I would like to conclude with remarks from my longtime friend and 
colleague, Gen. James L. Jones, who is destined to be the National 
Security Adviser to President-elect Barack Obama:

       The financial health of the domestic auto industry 
     suppliers is critical to national security. These suppliers 
     possess unique capabilities to design and manufacture 
     essential defense components should the United States need 
     them. We can't allow this critical piece of America's 
     manufacturing base to disappear.

  Mr. ROBERTS. Mr. President, today, I wish to offer my 2 cents on the 
latest version of the Auto Industry Financing and Restructuring Act, or 
as most Kansans call it, the auto bailout.
  As is often the case, the national debate over this issue has become 
more about perception than reality. And, unfortunately, this bill seems 
to take aim at the perception of the problem rather than the actual 
problem.
  If this body truly wanted to help auto manufacturers and their 
dealers and their suppliers, we would force not only the management of 
these companies to make tough choices but all involved, including their 
creditors and labor.
  And, Mr. President, we in Congress would need to make tougher 
decisions as well.
  Unfortunately, this bill offers the perception that concrete 
restructuring plans will be made for the companies to receive 
assistance, but reality is that this bill lacks the real teeth to 
enforce the type of restructuring that so many believe is necessary to 
put this industry back on its feet.
  If Congress were serious about turning the auto industry onto a path 
of profitability and stability, we would also need to look at our own 
actions that contributed to their current predicament.
  This was articulated quite well in a Wall Street Journal piece 
yesterday. In recent years, Ford, GM, and Chrysler made money supplying 
vehicles that consumers wanted, and in doing so made a profit for the 
companies.
  These vehicles were pickups and SUVs that met consumer needs. 
However, we in Congress decided that manufacturers shouldn't build many 
of these vehicles. We told the manufacturers that they should build the 
smaller, less profitable, more fuel efficient cars that many Americans 
don't want.
  If you come out to my home town of Dodge City, you won't see many 
hybrids or little two-door cars that get 30 miles per gallon. No, you 
will see Ford F-150s, Dodge Rams, and Chevy Silverados because my 
constituents need pickups for their daily lives.
  It is pretty hard to check your field and feed your cattle in a 
Prius.
  But that is the direction the Federal Government has pushed these 
automakers and continues to do so in this bill. We have pushed them 
away from the vehicles that turned a profit and created a perception of 
an alternate consumer demand.
  Another section of this bill that takes aim at perception rather than 
reality targets business aviation. The perception this bill creates is 
that business aircraft are some sort of excess expenditure. Because of 
the inconsiderate actions of three auto executives, this bill wants to 
condemn the entire business aviation industry.
  Well, as a Senator from the State with more general aviation 
production than anywhere else in the world, I cannot let that claim 
stand unchallenged.
  General aviation contributes more than $150 billion to the U.S. 
economy each year and employs over 1.2 million people right here in the 
U.S.
  Thirty-eight percent of the aircraft built here are exported, meaning 
the GA industry is one of the few remaining industries in the U.S. with 
a positive trade balance. Yet this bill takes the policy position that 
business aviation is unnecessary.
  If the intent of this bill is to punish the big three auto companies, 
then let's really go after them. Let's prohibit them from flying first 
class. You tell me what is wrong with flying coach. That is how I fly.
  Or maybe we should just prohibit them from flying at all.
  But that is not what this bill wants to do. As I have said, this bill 
only takes aim at the perception of the problem. It completely neglects 
the fact that companies, large and small, use business aircraft as a 
way to save time and money.
  Furthermore, small towns across the country depend upon the revenue 
generated by local airports serving business aircraft.
  The difficulties of the economy are not felt solely by the auto 
companies. Over the last 6 weeks or so, nearly 1,800 aviation workers 
have been laid off in Wichita, KS, alone. These layoffs and a downturn 
in new orders affects their suppliers and parts manufacturers as well.
  If these 14 lines of text condemning business aviation become the new 
benchmark for future legislation, then the U.S. Congress will have put 
an American industry that leads the global marketplace at unprecedented 
risk.
  I understand the situation our automotive industry is facing. I don't 
want to see layoffs or dealerships close or suppliers to have to cut 
production. But the reality is, whether Congress passes this $14 
billion bailout or not, these things will likely happen.
  The question we elected officials must answer is whether or not 
taxpayers will see a return on their investment.
  Unfortunately, the bill before us today does not provide such 
assurances.
  I am hopeful that we can continue working towards a bill that 
provides the necessary reform to ensure stability for the automakers 
and at the same time protects hard-working taxpayers.
  Mr. FEINGOLD. Mr. President, I will support this legislation to 
provide financing to the U.S. auto industry because without this 
assistance millions of American jobs, and a fundamental part of our 
manufacturing base, will be jeopardized. In these difficult economic 
times, with unemployment increasing, we cannot afford to see these jobs 
disappear.

[[Page 24752]]

  I understand that many people are upset about this rescue package. I, 
for one, am not happy to be running up still more charges on the 
taxpayers' tab. And I appreciate the arguments that have been made that 
the automakers' troubles are of their own making. Certainly some of 
their troubles are indeed of their own making, but not all of them. 
Some of the problems facing domestic automakers are the direct result 
of policies enacted or ratified in Washington.
  The collapse of the housing and credit markets clearly hit the 
credit-sensitive auto industry hard, and we know that those problems in 
particular were not of the auto industry's making. Far from it. They 
were the result of two decades of the reckless disassembly of a sound 
regulatory system, combined with some unscrupulous actions by many in 
the financial industry--a deadly combination that has now brought the 
entire economy to the brink of disaster including domestic auto 
producers.
  And at the same time Washington was repealing strong financial 
regulations, bipartisan majorities in Congress, led by Democratic and 
Republican Presidents, were also advancing deeply flawed trade policies 
which have further disadvantaged the domestic auto industry. Currency 
manipulation by foreign competitors, too, has put our domestic firms, 
including the automakers, at an enormous competitive disadvantage. 
Combine that with the failure of our major trade agreements to 
establish reasonable standards for workers, public safety, and the 
environment, and the self-made problems of domestic auto producers are 
greatly magnified.
  I will not defend the mistakes made by auto executives, but a 
significant amount of blame lies with Federal policymakers who blindly 
embraced philosophies of deregulation and trade that undermined 
protections for working families, public safety, and the environment. 
In fact, some of the same people opposed to any temporary help for the 
automakers now were the ones who helped dig the hole in which that 
industry now finds itself.
  More importantly, being angry at these companies' past mistakes is no 
reason to permit the auto companies to go under at this time. To allow 
these companies to go into bankruptcy could prove to be a tremendous 
shock to our already weak economy and could end up costing the U.S. 
taxpayers even more in pension guarantees, unemployment benefits, and 
other costs.
  And we are not just talking about the jobs of the autoworkers at the 
U.S. auto plants, although those jobs are important. We are also 
talking about the millions of jobs in related industries including 
steelmakers, rubber companies, hundreds of other suppliers, parts 
manufacturers, car dealers, and other industries that would be 
negatively impacted if the U.S. auto companies went bankrupt.
  Workers around Wisconsin are already struggling with the downturn in 
the auto industry and would be even harder hit if Congress fails to 
provide assistance to the auto industry. My hometown of Janesville, WI, 
is proud home to the oldest GM plant and for over 80 years, generations 
of Janesville men and women have built cars and trucks for GM. The 
Janesville GM assembly plant has been the core of the community and 
surrounding area for decades by providing its workers with family-
supporting jobs and contributing to the lifeblood of the community. 
Earlier this year, GM announced that it would cease production at the 
Janesville plant by the end of the year. Despite this unwelcome news, 
the State of Wisconsin and the local community, including workers, 
business owners, union leadership, have all come together to propose a 
plan to encourage GM to retool the plant to build a future product 
line. I am so proud that stakeholders in Janesville and in Wisconsin 
have come together to try to keep these jobs in Wisconsin and I will 
continue to do all I can, along with others in the Wisconsin 
congressional delegation, to support their efforts to keep an auto 
presence in Janesville.
  Janesville is not the only community in Wisconsin that is closely 
watching what we do in Congress this week. A Chrysler engine plant 
employs hundreds of people in Kenosha and various suppliers and related 
manufacturers do business in communities throughout southeastern and 
southwestern Wisconsin. I have also heard from auto dealers 
representing communities all across Wisconsin about the need to provide 
assistance to the U.S. auto industry to help ensure that their 
businesses continue to provide jobs in these troubling times. I 
understand Americans want businesses to be held accountable for bad 
decisions they have made in the past, and I do not think the Federal 
Government should get in the business of bailing out every industry in 
need of help. But in this case, failure to provide assistance to the 
auto industry could cause such a horrible shock to the American economy 
and communities all across our country that we must take action.
  While I think the Federal Government needs to act, any rescue package 
should not be a blank check and this particular rescue package contains 
various provisions to help ensure that the auto companies are held 
accountable for the Federal financial assistance they receive. Unlike 
the Wall Street bailout that I voted against, this bill provides strict 
rules that the auto companies must follow in order for the companies to 
be eligible for Federal assistance. The companies must negotiate with 
their employees, shareholders, creditors, and other parties to develop 
restructuring plans to show how these companies are going to reform 
themselves for the future, including improving their capacity to build 
the fuel-efficient vehicles that Americans are demanding. These 
restructuring plans are due within the first few months of 2009 and if 
they are not approved by the Federal Government, the auto companies 
will not be able to receive additional Federal funding and will have to 
repay the Federal assistance they have already received.
  I would have preferred this money to come from the $700 billion Wall 
Street bailout that Congress passed earlier this year. I am 
disappointed that the Bush administration refused to use its authority 
under the Troubled Assets Relief Program, TARP, to provide financial 
assistance to the auto companies. Congress's investigative arm, the 
Government Accountability Office, testified before the Senate Banking 
Committee last week that the Bush administration currently has the 
authority under TARP to provide this assistance. Secretary Paulson 
could have acted weeks ago to provide such assistance to the auto 
industry, yet he continues to refuse to take those steps, and allocate 
what amounts to a small percentage of the Wall Street bailout to help 
millions of working families in this country.
  Because of the administration's refusal to use its existing authority 
to help the auto industry, Congress has been forced to act. 
Unfortunately, we have also been forced by the administration to take 
money from the Section 136 Advanced Technology Vehicles Manufacturing 
Program that was created last year to provide Federal funding to auto 
companies and manufacturers to help them as they develop more fuel-
efficient vehicles and related technology. This bill is far from 
perfect and one of my biggest concerns is that Congress has been 
compelled to raid the pot of money designed to help auto companies and 
parts manufacturers build more fuel-efficient cars in the future. 
Diverting the Section 136 money is going to further set back the work 
that the auto industry is doing to make their products greener and more 
marketable.
  Everyone, including the U.S. auto industry, has acknowledged that 
U.S. auto companies need to start building more fuel-efficient 
vehicles. Furthermore, all of the U.S. auto companies have applied for 
loans under Section 136 and access to the Section 136 retooling funding 
is critical to their future success. Yet today we are taking this 
retooling money to pay for the short-term survival of these companies. 
This was a false choice and if the administration had been more willing 
to work with us on this issue, we could have done both. Instead, by 
taking from the

[[Page 24753]]

Section 136 program today we are engaging in extremely shortsighted 
policymaking. I will work with my colleagues to help ensure that 
funding for Section 136 is reinstated next year.
  I regret that we find ourselves in this position today. I thank 
Senators Levin, Stabenow, and Dodd and their colleagues in the House of 
Representatives for putting together this legislation in very difficult 
circumstances. This bill is not perfect, but given the need for prompt 
action, I will support it and I urge my colleagues to do the same. We 
must act in order to help protect millions of American jobs from 
disappearing and to help prevent countless communities in Wisconsin and 
around the country from experiencing even more economic hardships in 
the short term. As the new Congress gets under way shortly, I look 
forward to helping develop longer-term policies to assist American 
industry as it responds to 21st century challenges so that it can 
continue to lead the world in innovation.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. REID. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Tester). Without objection, it is so 
ordered.

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