Open

Coming up

Don't miss

Replay


LATEST SHOWS

IN THE PAPERS

Shifts in the propaganda war waged between Israelis and Palestinians

Read more

IN THE PAPERS

French MPs face quandary in pro-Palestinian rallies

Read more

THE INTERVIEW

Yezid Sayigh, Senior Associate at the Carnegie Middle East Center in Beirut

Read more

#TECH 24

Mind the Gender Gap : getting more women into the tech sector

Read more

INSIDE THE AMERICAS

Bolivian children: heading to work aged 10

Read more

WEB NEWS

Israel and Hamas battle online over public opinion

Read more

FOCUS

Can Chancellor Merkel's winning streak last?

Read more

FOCUS

Hunger in a fertile land...

Read more

DEBATE

Nigeria: One Hundred Days and Counting (part 2)

Read more

  • Live: Algerian jet with 116 on board 'crashes' in northern Mali

    Read more

  • ‘Many’ French passengers aboard missing Algerian plane

    Read more

  • Iraqi parliament elects moderate Kurd as president

    Read more

  • Sudanese Christian woman sentenced to death arrives in Italy

    Read more

  • No end to fighting until Israel ends Gaza blockade, Hamas says

    Read more

  • Two foreign women shot dead in western Afghanistan

    Read more

  • At least 60 killed in attack on prison convoy near Baghdad

    Read more

  • Cycling is ‘winning the war on doping,’ says expert

    Read more

  • Ceasefire agreed for Central African Republic

    Read more

  • Can Jew-kissing-Arab selfie give peace a viral chance?

    Read more

  • In pictures: Thousands march for Gaza peace in Paris

    Read more

  • France charges Swiss bank UBS with tax fraud

    Read more

  • Israel faces heightened diplomatic pressure as Gaza violence rages

    Read more

  • Botched Arizona execution takes nearly two hours

    Read more

  • Bomb attacks leave scores dead in north Nigeria

    Read more

White House, Congress reach tentative bailout deal

Video by FRANCE 24

Latest update : 2008-12-10

The White House and Congress said on Tuesday they had agreed on the outline of a 15-billion-dollar bailout plan for the US auto industry but added that negotiations on the content of the future bill were still going on.

REUTERS - The White House and congressional Democrats on Tuesday night reached an agreement in principle on a $15 billion proposal for bailing out U.S. automakers, officials said.

A Bush administration official and a Democratic leadership aide said the accord covered key points but final issues needed to resolved and put in writing.

Democrats have arranged to have the House of Representatives vote on a bill as early as Wednesday and send it to the Senate for consideration.

President George W. Bush and President-elect Barack Obama were both urged by a key lawmaker to help rally support by Democrats and Republicans for the pending measure.

"Bipartisan hard work has paid off," said Democratic Sen. Carl Levin of Michigan whose home state headquarters General Motors Corp Ford Motor Co and Chrysler LLC.

"I understand an agreement has been reached," Levin said in a statement.

The bailout is designed to allow GM and Chrysler to avert threatened bankruptcy through March with short-term loans. Ford Motor Co is not requesting immediate help but would like a line of credit in case its finances worsen.

The parties that negotiated the tentative deal agreed last week that the money would come from an Energy Department fund established in September to help Detroit make more fuel-efficient cars.

'Car czar' to monitor

The administration official said the negotiators satisfied the key White House concern in the talks that companies receiving aid obtain the necessary concessions and make other changes to prove they can survive and compete.

In addition to providing $15 billion in loans, the Democratic proposal would force automakers to answer to a presidentially appointed trustee -- or "car czar" -- and make the government their biggest shareholder.

The negotiators have resolved questions about the overseer, which will have powers to shape a restructuring of the companies, withholding further loans if progress toward a turnaround stalled.

A key provision would permit the czar to recommend a bankruptcy restructuring if companies borrowing money fail to obtain the necessary concessions. Some Republicans wanted some sort of bankruptcy option included as an incentive for labor and other stakeholders to agree on givebacks.

The administration still opposes a Democratic bid to force automakers to drop lawsuits against California and other states seeking to cut auto emissions and other greenhouse gases. The administration official said it was his expectation the bill will not succeed unless that provision is struck.

Democrats control Congress and were expected to be able to muscle a bill through the House. But it was unclear if Republicans could stop a measure in the Senate with a procedural roadblock that requires 60 votes to clear.

"Ball is in the Senate Republicans' court," said Jim Manley, a spokesman for Senate Majority Leader Harry Reid, a Nevada Democrat. "There is no word yet whether they will give us consent."

A spokesman for Senate Minority Leader Mitch McConnell, a Kentucky Republican, said he would decline comment until he saw the bill.

Mixed emotions

An auto bailout has evoked competing emotions in Congress.

Lawmakers fear if automakers collapse, it would deepen the U.S. recession. But many say market forces, not a government saddled with a record deficit, should determine their fate.

There also is reluctance to provide another federal rescue in the wake of the voter backlash against Congress for its passage of a $700 billion bailout for Wall Street in October.

At the same time, many argue that if Congress provided relief for millionaires in the U.S. financial industry, it should also help blue-collar autoworkers facing unemployment.

Automakers have had powerful friends in Congress over the years who have shielded them from adopting costly and stricter fuel efficiency standards.

But they also had critics who complained automakers were led by poor executives who stuck to producing gas-guzzling vehicles unable to compete with smaller, foreign-made ones.

A poll by CBS News conducted last week found Americans split on whether taxpayer funds should help automakers.

But more than 65 percent said in exchange for any aid, the government should have a say in the automakers' management and require more fuel-efficient cars.

The rescue plan would grant the government the right to acquire preferred shares, or the economic equivalent, equal to 20 percent of the amount loaned.

At GM, that could mean the government would end up with half of the equity in the top U.S. automaker before factoring in any new shares the company would issue as part of an effort to cut debt by $30 billion, analysts said.

Shares of GM and Ford rose more than 20 percent on Monday on prospects for a rescue deal but gave back some of those gains on Tuesday as they dropped about 4 1/2 percent.

Date created : 2008-12-10

COMMENT(S)