Transcripts

The Auto Bailout Bill Is Getting Yet Another Tune Up

PAUL KANGAS: There's a new round of let's make a deal under way on Capitol Hill tonight. Late yesterday the House passed its version of the automotive industry bailout bill. But that got snagged in the Senate today when Republicans balked at the plan. As Stephanie Dhue reports, at stake is the Federal rescue of the auto industry.

STEPHANIE DHUE, NIGHTLY BUSINESS REPORT CORRESPONDENT: Senate Republican leader Mitch McConnell threw a wrench into auto makers' hopes for passage of the House bill, saying he could not support it.

SEN. MITCH MCCONNELL, MINORITY LEADER: The best route for the long- term viability of ailing car companies may be a rocky one. Government help is not the only option. It's not even the best option. Long-term viability is still possible, but it's only possible if these companies are forced to make the tough choices necessary for their survival.

DHUE: Instead McConnell supports a proposal by Senator Robert Corker. That plan would fund the loans now, but require GM and Chrysler to make specific changes or file for bankruptcy by March 15. Those changes include: the companies reducing outstanding debt by two thirds through an equity swap with bondholders; bringing labor costs in line with Honda, Toyota and Nissan; and requiring payments to a retiree health fund are made with company stock. Corker urged his colleagues to support the idea.

SEN. BOB CORKER, (R) TENNESSEE: Tell me why we couldn't put these three covenants in place, which are very reasonable. They are the only things that can happen in real time to make these companies successful and let's pass a bill that causes these companies to be strong, gives them the money to breathe.

DHUE: That proposal set off a new round of behind closed doors negotiations. Late today, Senator Majority Leader Harry Reid said what emerges from those talks could be the basis for a new package.

SEN. HARRY REID, MAJORITY LEADER: If the negotiations which are going forward now bear fruit, then that would be the issue that I think would pass with a significant margin here in the Senate.

DHUE: If the Senate does pass a new plan, the House will have to sign off on the proposal before it could go to the president's desk. Stephanie Dhue, NIGHTLY BUSINESS REPORT, Washington.