SCENARIOS: Where Washington stands on the auto bailout

Wed Dec 3, 2008 6:07am GMT
 
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(Reuters) - General Motors Corp., Ford Motor Co., and Chrysler LLC are presenting restructuring plans to Congress as they seek a $25 billion bailout that could help them survive the troubled economy.

Detroit is gambling that the automakers' plans show labor, management, creditors and investors sharing in sacrifices will win political support that has so far eluded the companies.

The industry's appeal for aid will be scrutinized in hearings by the Senate Banking Committee on Thursday morning and by the House of Representatives Financial Services Committee on Friday morning.

Here is where the political players in Washington stand:

THE WHITE HOUSE: The Bush administration, which remains in power through January 20, opposes spending any new money to bail out Detroit.

It also does not want to use the $700 billion that is earmarked for ailing financial institutions, worrying that other industries would feel entitled to a slice as well.

The White House has suggested redirecting $25 billion in loans that are intended to help Detroit retool factories and make more fuel-efficient vehicles.

CONGRESSIONAL DEMOCRATS: Democrats who control both chambers of Congress don't want to redirect the existing loans, a move that would anger their environmentalist allies.

Democrats are angry that automakers resisted their efforts for years to increase fuel efficiency and may attach tough conditions, such as forcing out senior management, to any bailout money.  Continued...

 
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