Lawmakers talk strategy on auto loans
Detroit 3 step up efforts for $25 billion
WASHINGTON -- Michigan lawmakers will meet with House Speaker Nancy Pelosi, D-Calif., today to map plans for votes on funding $25 billion in loans for the auto industry, while Detroit automakers step up their lobbying efforts.
The turmoil in financial markets only served to emphasize the bid by Detroit automakers and parts suppliers for some aid toward retooling factories. The $25 billion in loans was approved, but not funded, in last year's energy law as part of a compromise to raise fuel-economy standards to 35 m.p.g. by 2020.
As the Free Press reported Saturday, the Congressional Budget Office said it now estimated that the government's cost of last year's $25-billion program would be $7.5 billion, double the previous estimate. CBO Director Peter Orszag said the new estimate reflects the worsening credit markets facing automakers.
The estimate will change depending on what other alterations automakers want to make to the program. UAW Legislative Director Alan Reuther said the CBO's figures were too high, and underestimated how much of the loans would go toward suppliers.
The cost may not matter if the proposal passes outside the regular budget rules, as part of either a second economic stimulus or the resolution keeping the government open through the elections.
That's the bill automakers and many Michigan Republicans favor, because it's the only legislation that must be passed and signed by President George W. Bush before Congress adjourns.
Democrats may have different plans. Even though Senate Republicans will likely block energy and stimulus bills, House Democrats could pressure Republicans by putting the loans in a stimulus plan, forcing a tough vote on some lawmakers facing tough re-election campaigns.
Detroit executives are stepping up lobbying trips. GM Chairman Rick Wagoner will give a speech tonight to the Washington Economic Club. Ford Chairman Bill Ford, who's scheduled to attend an environmental event Wednesday, is expected to meet with lawmakers later today, as well.
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