WASHINGTON — Detroit’s automakers returned to Congress on Thursday offering new concessions in a desperate plea to obtain a government bailout to keep them afloat, But lawmakers remained wary.
General Motors appeared to be facing the greatest peril as the chief executives of the Big Three left no closer to obtaining the $34 billion in emergency aid they have requested.
House Speaker Nancy Pelosi, D-Calif., and Sen. Majority Leader Harry Reid, D-Nev., sent a letter to President George W. Bush late Thursday again urging him to tap the $700 billion in Wall Street rescue funds, saying they are hopeful they can work “cooperatively” to “provide urgent assistance and support our domestic auto industry.”
The White House held discussions as recently as Wednesday among various Cabinet departments about how the administration could aid automakers in the event Congress cannot agree on providing funding, but Bush has not decided whether he would step in.
During a six-hour hearing Thursday, many members of the Senate Banking Committee praised the recovery plans the automakers had submitted to justify federal aid and the executives’ efforts. They also acknowledged that the collapse of an auto company would have grave economic consequences.
“Nothing concentrates the mind like a death sentence,” said committee chairman Chris Dodd, D-Conn., warning that doing nothing “is to play Russian roulette with our entire economy.”
But Dodd told reporters late Thursday it wasn’t certain any deal could be made with time running out.
“I believe that we could lose General Motors by the end of this month,” said United Auto Workers president Ron Gettelfinger, who joined the CEOs for the second round of congressional hearings.
The UAW agreed Wednesday to make new concessions to help salvage the industry.
The auto executives are to make their case at a House hearing today, and Congress could take up rescue legislation next week in an emergency session.
Capitol Hill aides said Congress may end up approving $10 billion in aid next week, delaying a decision on the rest of the money until President-elect Barack Obama takes office.
GM offered the most comprehensive plan, proposing to restructure debt, reduce labor costs, win new labor concessions, and close, shrink or sell four brands. GM also pledged to cut 21,000 to 31,000 more jobs by 2012 and close nine more factories. GM said it would need $4 billion in government loans to survive through Jan. 31.
Chrysler said it needed to use $4 billion in government aid to last through March 31.
Wagoner, GM’s chief since 2000, sounded weary as he faced fresh questioning on whether the company needed new management.
“I think the leadership team we have is the right one, but I serve at the pleasure of the board,” he said.
Committee members were skeptical.
“We are asking extraordinary things of our witnesses today,” Sen. Sherrod Brown, D-Ohio, said. “We did not ask those CEOs of the banks to drive into town in a Wells Fargo armored truck” to collect tens of billions of dollars and they weren’t asked for detailed plans.
