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Auto bailout: Congress gets closer to a decision

Lawmakers say bankruptcy for Detroit's Big Three is 'not a viable option.'

By Staff writer of The Christian Science Monitor / December 5, 2008

Tough talk: Richard Wagoner of General Motors, Ron Gettelfinger, of the United Auto Workers International Union, and Alan Mulally of Ford Motor Company at Thursday's Senate hearing.

Joshua Roberts/Reuters

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Two weeks after bruising hearings on their plea for federal help, Detroit's Big Three returned to Capitol Hill with a bigger request, a chastened tone, and more political muscle.

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Heading toward what would be the last vote of the 110th Congress, Democratic leaders and the Bush White House are still at odds over how to fund the automakers' $34 billion loan request.

But there's a growing consensus among lawmakers once critical of the bailout that inaction – or punting the decision to the Obama administration – is no longer an option.

"Bankruptcy is not a viable option, because it will seal the death of the domestic automobile industry," said Sen. Charles Schumer (D) of New York, at a hearing of the Senate Banking Committee on Thursday.

"I think I speak for many of us here: We care less about where the money comes from than how it's spent," he said, adding that he still did not trust the management of US auto companies to direct their own recovery.

In a bid to regain trust on Capitol Hill, the CEOs of the Big Three drove to Washington for back-to-back hearings this week – eschewing the corporate jets that riled lawmakers at their last appearance on Capitol Hill.

General Motors CEO Richard Wagoner finished the last leg of his drive in a prototype of GM's plug-in hybrid – the Chevy Volt, which was parked nearby for lawmakers to see.

"We're just plowing ahead because this innovation is exciting to us," said Tony Posawatz, on site to show the Volt to lawmakers and the press.

"We're the only ones on record to do this high-volume production [of electric cars], once we get through these near-term economic issues," he added.

At the same time, the United Auto Workers union announced contract concessions on Wednesday to bolster the case that Detroit is changing its ways.

"We and the workers and retirees we represent are prepared to do our part to ensure that the companies can continue as viable operations," UAW president Ron Gettelfinger told the Senate banking panel on Thursday.

Meanwhile, UAW members swarmed over Capitol Hill, trolling for votes – or at least a less hostile stance from lawmakers opposing the bill.

"I think we were able to put a personal face on the situation," said Mike Herron, chairman of UAW Local 1853 at the Saturn plant in Spring Hill, Tenn. In the run-up to Thursday's hearings, Local 1853 members met with Sen. Bob Corker (R) of Tennessee, who has opposed a bailout.