{"database": "openregs", "table": "congressional_record", "rows": [["CREC-2008-12-11-pt1-PgS10890-4", "2008-12-11", 110, 2, null, null, "AUTOMOBILE CRISIS", "SENATE", "SENATE", "ALLOTHER", "S10890", "S10894", "[{\"name\": \"Bob Corker\", \"role\": \"speaking\"}, {\"name\": \"Johnny Isakson\", \"role\": \"speaking\"}, {\"name\": \"James M. Inhofe\", \"role\": \"speaking\"}, {\"name\": \"John Ensign\", \"role\": \"speaking\"}, {\"name\": \"Benjamin L. Cardin\", \"role\": \"speaking\"}]", "[{\"congress\": \"110\", \"type\": \"S\", \"number\": \"3683\"}]", "154 Cong. Rec. S10890", "Congressional Record, Volume 154 Issue 186 (Thursday, December 11, 2008)\n\n[Congressional Record Volume 154, Number 186 (Thursday, December 11, 2008)]\n[Senate]\n[Pages S10890-S10894]\nFrom the Congressional Record Online through the Government Publishing Office [www.gpo.gov]\n\n                           AUTOMOBILE CRISIS\n\n  Mr. CORKER. Mr. President, I rise today to talk about where we are in\nthis auto bailout. In essence, it is show time here. A bill came over\nfrom the House last night. It is the end of the year. There is an\nimpending crisis we are dealing with here in the country. So today we\nwill be debating that and hopefully in the next few days take a vote.\n  I spent a lot of time in the committee talking with certain and\nvarious parties involved. I spent a lot of time outside the committee\ndoing the same thing. There is no doubt we are going through an\neconomic time that is very difficult for the auto industry. It is also\ndifficult for businesses and families all across this country as they\ntry to make their budgets work out.\n  As we have looked at this issue, I know there has been a lot of\nnegotiation that has taken place between the White House and House\nDemocrats. I really think the product that has been developed is a very\npoor product.\n  I don't blame that on my Democratic colleagues who negotiated because\nthe White House is actually at a point where they are looking for the\nnext flight out of town on January 20. Basically, they want to kick the\ncan down the road and let some other administration and some other\nCongress deal with this issue. All of us are going to be here next\nyear. It is our responsibility to deal with this issue in a\nprofessional and a competent manner and actually solve the problem.\n  I say to my colleagues on both the left and right, on the Democratic\nand Republican sides, we have a historic opportunity to actually solve\nthis problem. The solution is very simple.\n  I have looked at this legislation that has come over. It is similar\nto so many things we do around here. It is akin to a three-humped\ncamel. You couldn't make it more ineffective and more complicated. We\nhave put in place a czar. It seems like with everything we do around\nhere, we try to find a person who can save us from the crisis that is\nhappening. We did the same with the financial rescue package not long\nago. I have looked at the actual responsibilities of this czar. I said\nyesterday I had a banking staff person who actually could fulfill those\nresponsibilities. She read that in the paper this morning and came in\nand said she is overqualified, that in essence this is not something\nshe would want to take on. I think we can use some help, certainly,\nfrom the outside, and there may be a role for somebody such as this.\nBut what we are looking at is a fairly simple transaction. It is a lot\nof money, a fairly simple transaction.\n  Here is what we have. We have three companies. Two of the companies\nare on the verge of bankruptcy. As a matter of fact, I would say two of\nthe companies are in bankruptcy. I know Chrysler, today, is meeting\nwith their supplier group. I know if they don't win concessions today,\nthey are in great trouble. General Motors has told us if they don't\nreceive funding by the end of this year, they will have to file\nbankruptcy. I believe that.\n  We have a lot of Republicans who would like to see that happen, would\nlike to see chapter 11 occur and to see them go through the laws that\nexist for reorganization in a way that is clean and allow them to move\nahead in a financially stable way. As a matter of fact, many\nRepublicans would actually agree to something called debtor-in-\npossession financing after that occurred so these companies could\nevolve. There are people on the other side of the aisle who have\ndecided that is a cost that is too great to bear.\n  I started out along the path that I believed the best way for us to\nsolve the problem was to actually cause these companies to go through\nreorganization and any role we might play as the Federal Government\nwould be in the way of debtor-in-possession financing. After listening\nto the testimony and after talking to people all across the country who\nare involved, I do believe the supply chain is in great stress. They\nare undercapitalized. The three companies have already been utilizing\nthe supplier chain for financing by paying late and carrying payments\nfor lengths of time. I do think the supply chain is fragile.\n  What I have tried to do is figure out a way to create a piece of\nlegislation that is elegant, simple, actually solves the problem, and\ncauses these companies to be in great shape and for us to be able to\nmove ahead and know that has been done.\n  There are a lot of times I have heard people say: We are from the\nGovernment, and we are here to help you. When people hear that, they\nusually run for the hills. This is a case where if we will take a\nmoment, we can actually do something that is great for these companies.\nWe have a big stick. These companies cannot get financing anyplace\nexcept from the Federal Government. So we have an opportunity to sort\nof thread the needle in a simple way and cause these companies to be\nsuccessful.\n  Let me say, other than the economic issues, these companies have\nthree major issues. Each one of them is different. We know that\nbasically we are talking about General Motors here. We wouldn't be\nhaving this discussion if it weren't for General Motors. Chrysler would\nnot be here if it weren't for that. They are in serious trouble but\nwouldn't have the clout to be able to talk to us in this way. Ford has\nmoney today because of refinancing they did back in 2006. They are not\neven part of the discussion today. They might be down the road, but\ntoday they are financially viable, although burning cash at a rate that\nis almost equal to that of General Motors. We are talking--to make this\nclear to people--\n\n[[Page S10891]]\n\nabout three entities we need to talk to: General Motors, Cerberus or\nChrysler, and the UAW.\n  There are three things that are basically causing these companies\ndifficulty. One is the capital structure. The debt these companies have\nis not sustainable. It doesn't matter how much money we were to put\ninto General Motors; with the $62 billion in debt they have today,\nthere is no way they can sustain their company. They cannot. GM only\nhas a market cap today of around $2 billion. Toyota has a market cap of\n$130 billion. BMW has a market cap of $14 billion. So this is a company\nthat has a huge amount of debt and very little value. Chrysler probably\nhas no value. They are privately held. So we have two companies we need\nto deal with in a similar way, as it turns out.\n  Let me lay something out. Right now the capital structure in both\nplaces is too high. Cerberus and Chrysler can't withstand its debt. GM\ncannot withstand its debt. Secondly, the labor costs are out of line. I\nknow there is a lot of talking about the UAW. Candidly, I will admit,\nin some cases they get a bad rap. A lot of the people who are my\nfriends would not like me saying that, but in some cases they actually\nget a bad rap as to the way the comparisons go.\n  The third issue is the dealership issue. I don't think we can deal\nwith that today. There are two issues we can deal with in this loan and\nsolve the problem. One is the capital structure. The other is the labor\nissue. Here is what I propose. We will be putting this forward, as\nSenator Reid mentioned. We have some alternative legislation. I hope it\nis something both Democrats and Republicans can embrace. It is very\nsimple. Let's go ahead and fund the money. Let's fund the money that\nhas been requested. To Republicans, that is like debtor-in-possession\nfinancing anyway because these companies are basically bankrupt. To\nDemocrats, the funding is in place to cause these companies to be\nwhole. Let's go ahead and fund the request that has taken place.\n  Let's have three covenants. We can do this with a very short bill\nwhich we drafted. The first covenant is that by March 15, the\noutstanding indebtedness at the two companies that are going to apply\nfor this has to be reduced by two-thirds or the companies have to file\nfor bankruptcy on March 15. That gives the companies, the bondholders,\nwhich we have talked to on the phone, plenty of incentive to make sure\nthe debt is reduced by two-thirds so these companies have a capital\nstructure that allows them to go forward. This is the only way they\nwill be successful. We have had plenty of people testify that if we put\nour money on top of the $62 billion in debt GM has, there is no way\nthey can be successful, even if we are selling 20 million cars a year.\nToday, we know, we are selling at a 10 million rate. That is No. 1.\nGive them the money. If by March 15 they haven't reduced their capital\nstructure in that regard--and we have talked to people on all sides who\nbelieve this can happen, but it can only happen with the stick of\nGovernment, meaning we are going to force them into bankruptcy if they\ndon't do it. That is the first covenant.\n\n  The second covenant is, I have listened to Mr. Gettelfinger's\ntestimony and talked to him on the phone this morning. He says the only\nway the UAW can make concessions is if they see the bondholders have\ndone so first. This legislation makes that happen by March 15. So,\nsecondly, after the UAW has seen that the bondholders have taken a\n``haircut,'' a word that is used around here a lot, they have to do two\nthings: No. 1, they have to convert half the VEBA obligation, the\nVoluntary Employee Benefit Association obligations. They have to\nconvert half those to equity. If the company goes bankrupt, these\nfuture payments are never going to happen anyway. Again, that reduces\nthe debt at GM by another $10.5 billion, and it gives the UAW equity in\na company that actually has value now because the debt by the\nbondholders has been reduced. That is the second covenant--very simple.\n  The third action they have to take is at that same public meeting\nwhere they take a vote, they have to agree to have a contract in place\nthat puts them in parity with companies such as Toyota and Nissan and\nVolkswagen and other companies here. Before everybody goes crazy over\nthat, that is as certified by the Secretary of Labor. That is not\nsomething we prescribe. I realize there will be subtleties in that.\nThere are comparisons that have to be made. To my friends on the left,\nthat would be a Secretary of Labor by the Obama administration who has\nthe ability to look at the various differences and nuances to actually\ncertify that.\n  I have talked to Ron Gettelfinger this morning. Because of the\ndebates we have had recently, I am probably not on his Christmas card\nlist this year. I realize that. But he actually is talking with his\nleaders about this. I have talked to the COO at General Motors last\nnight and this morning. He was the former chief financial officer. He\nagrees this will work. This gives the stick to the Government to make\nthem have to do the things they need to do to actually cram down their\nbondholders.\n  I have heard a lot about Main Street and Wall Street. For those\npeople who want to take an ounce or a pound of flesh from Wall Street,\nthose are mostly the people who own these bonds. They will be taking\nthis huge haircut, two-thirds. In GM's case, it is about $20 billion\nthat would be converted to equity and take away a face amount of debt.\n  I plan to be here all day today. I would like to take 30 minutes off\nfrom 12:30 to 1 to give a talk someplace. But I would ask any Democrat,\nany Republican to please come down to the floor, call me, e-mail me,\ntell me why we couldn't put in place these three covenants which are\nvery reasonable. They are the only actions that can happen in real time\nto make these companies successful. Let's pass a bill that causes these\ncompanies to be strong, gives them the money to breathe.\n  By the way, we had somebody testify the other day in Banking who said\nthat if we give money to these companies in the form they are in today,\nwe will end up giving $75 to $125 billion. I talked to the President of\nGM this morning. He says if we can make this happen--of course, the\nbondholders say we can, he says we can--that they will be limited in\ntheir request to only what they have asked for. They do not believe any\nmore U.S. dollars will be required.\n  I ask my colleagues, why would we not take a simple piece of\nlegislation, put it in place. It acts like debtor-in-possession\nfinancing. It does what we need to do to make sure the bondholders and\nthe UAW themselves do the things they need to do to make the company\nwhole. Management is already hamstrung by the bill. It lays out the\nitems management must forgo for these loans to be in place. Let's leave\nhere having done something that actually causes these companies to be\nhealthy, vibrant, able to go into the future in a strong way for the\nfirst time in 30 years. We can do something great today, if we will\nonly sit down and do it.\n  I ask my colleagues to do one other thing. We have tried to make this\nso complicated. There are three groups each of you can call to see if\nthis will work. Call Chrysler, call General Motors, call the UAW and\nask them if this will work. If there is a sentence we need to change, a\ncomma we need to put in place, let's do it. But it is very simple. We\nhave drafted a bill as if we are saving the world. We are talking about\nthree companies alone, actually two companies today alone and three\ncovenants can solve this problem, put them on a solid foundation, move\nthem ahead. We will have done the right thing for the American\ntaxpayers. We will have done the right thing for these companies, and\nwe will have acted responsibly together in concert, doing something\nthat, again, is right for our country.\n\n  Mr. President, thank you for the great length of time. I hope my\ncolleagues on both sides of the aisle will come down and tell me why\nthis will not work. Thank you very much.\n  I yield the floor.\n  The ACTING PRESIDENT pro tempore. The Senator from Georgia.\n  Mr. ISAKSON. Mr. President, will the Senator from Tennessee yield for\na question through the Chair?\n  Mr. CORKER. Yes.\n  Mr. ISAKSON. First of all, Mr. President, I commend the distinguished\nSenator for all the work he has done on this issue over the last 2\nmonths. But I\n\n[[Page S10892]]\n\nhave one question. Is it not true that almost all those conditions in\nthose three conditions you outlined were in whole or in part verbally\ncontemplated by the automakers in terms of what it is going to take for\nthem to come back and be profitable in the first place?\n  Mr. CORKER. No question. I say to the Senator from Georgia, they have\ncome in our offices and actually--they have advisers. Their financial\nadvisers have told them that they need for us to craft this legislation\nthis way so they have the hammer they need to make the bondholders\nreduce their debt so they can be healthy. Without this kind of hammer,\nnothing is going to happen.\n  Look, you have read this bill. This bill says they have to have a\nplan to show a net present value in place by March 31--a plan. It does\nnot say when it has to be accomplished. We can solve this problem so\nsimply for them, for the United Auto Workers, for the State of\nMichigan.\n  By the way, for the record, I want to say I have a General Motors\nplant in my State. It is very important. It is modern. It has been\ninvested in. We have a Nissan plant, and we have a Volkswagen plant\ncoming.\n  The automobile industry is very important to me, as I know it is to\nyou, I say to the Senator from Georgia. I thank him for that question.\n  Mr. ISAKSON. Mr. President, I say to the Senator from Tennessee, I\nthank you for your hard work.\n  Mr. President, I yield back.\n  The ACTING PRESIDENT pro tempore. The Senator from Oklahoma.\n  Mr. INHOFE. Mr. President, I also thank the Senator from Tennessee\nfor all his labors and what he has been through. Quite frankly, I came\nback from the Horn of Africa and Afghanistan on Saturday or Sunday--\nanyway, over the weekend--and when I saw all this stuff coming up, I\nknew from my experience in the Senate that nothing was going to happen\nfor a few days, so I did not stay and work hard like my friend from\nTennessee. I went back to Oklahoma. I do that now and then just to talk\nto normal people, to hear what these people have to say, as opposed to\nthe bureaucrats and the stuff we get in Washington.\n  In a way, it is a little bit humorous. We went through the $700\nbillion bailout. I can remember everybody talking about Secretary\nPaulson coming down and saying: The world is going to come to an end if\nwe do not do this. He said: We are going to have to do it.\n  Well, we did some calculations, and I do not think most of the\nAmerican people realize when we talk about these numbers--whether it is\n$14 billion or $700 billion--how much it really is. If you did your own\nmath when this stuff comes up--this is what I always do--there are 139\nmillion families in America who file tax returns. If you take the 139\nmillion families and divide that number into $700 billion, that is\n$5,000 a family. Now we are talking about something that is serious.\nWhen I tell people in Oklahoma that, that gets their attention.\n  So here we are talking about $14 billion right now. Nobody seemed to\ncare before, and we just passed that matter by a huge margin: 75 to 24.\nI was one of the 24 who voted against the $700 billion bailout. But we\npassed it by that huge margin, more than 2 to 1. It is something that\nis so much bigger than the $14 billion we are talking about now. We are\nmaking a big issue about the $14 billion. Where was all the concern and\noutrage when we were talking about $700 billion?\n  So we watched it come along, and we saw that we gave the Secretary of\nthe Treasury all the money that he was asking for. Then we find out\nthat as to what he was going to use the money for, it was not used for\nthat at all. He said, and I heard it myself--everyone in here heard it:\nthe Democrats heard it; the Republicans heard it--if we don't have this\n$700 billion to buy out troubled assets, this whole country is going to\ngo down--this doom and gloom. Once he got it, he did not do it. He did\nnot come to us and say: Well, there is a different plan now. We are\ngoing to use it in some other way because I don't think this is going\nto work.\n  So that got my attention. I decided at that time: Well, if they are\ngoing to go ahead and give him this $700 billion, let's see what there\nis in that law that we passed that might be to the benefit of people\nwho are concerned about this issue. I saw that it was broken into two\nparts. The first $350 billion pretty much was given to him to use at\nhis discretion, which he did. He did not come to us and say he was\ngoing to use it in a different way. He just went ahead and did it. It\nis the first time in the history of America that anything close to $350\nbillion was spent in such a way.\n  Then we have in the law that was passed a provision that says if he\nneeds the other $350 billion, he can go ahead and do that, and if there\nis not an objection--as a matter of fact, if he does this, and does\nthis when we are out of session, we would be helpless to try to do\nanything to stop it.\n  So I introduced a bill. It is S. 3683. It is not going to be\nconsidered. I am not a member of the club, so that is not going to come\nup, although we have made an effort and we actually have some Democrats\non the bill. That is something that uses the rules that are out there\nand says we can change the second $350 billion so it will take a\npositive act of Congress to allow them to access the second $350\nbillion.\n  Now, let's quickly jump back to the current issue. I wanted to put\nthat in perspective because when we talk about $14 billion, compared to\n$700 billion, I just wish there was that much outrage when we were\nmaking that commitment. So here we are talking about one unelected\nbureaucrat to be known as the car czar--get ready for the car czar. We\nhave only had one good czar in the history of America that I know of,\nand that was Bill Bennett when he was the drug czar. However, he was\nnot given a blank check to spend a whole bunch of money. He is just a\nbrilliant guy who was going to try to stop some of the stupid things we\nwere doing in this country. That was back in the 1980s when the drug\nproblem first surfaced as a major problem. He did a great job. I draw\nhim out as an exception when I talk about czars. Now we are talking\nabout a car czar. This guy is going to have the same bureaucratic power\nthat Secretary Paulson had during the time he pulled off this $700\nbillion bailout.\n  Now, this bill makes the U.S. Government, the taxpayers, part owners\nof these companies. This $14 billion bill is one that is going to\nsurface probably today. People are talking about, and the leader talked\nabout, maybe we will go all the way through the weekend if we do not\nget something done. But the instrument that came over from the House\nyesterday to the Senate is most likely what we are going to be\nconsidering, and it is one that makes the Government part owners of\nthese companies.\n\n  The car czar does not have any specific instructions, such as\nrenegotiating some of the union contracts and some of the things that\nwill have to be done. I looked at this early on, and I thought, as\nundesirable as bankruptcy is, I do not know of any other way you can\nactually force the tough negotiations that will have to take place. It\nhas to be management and labor. It is not just labor; it is not just\nmanagement. There has been mismanagement. But they would have to\nsatisfy the courts that we have a system that will work.\n  I read an article in the New York Times from the middle of November,\nand it was entitled ``A British Lesson on Auto Bailouts.'' It discussed\nthe British treatment of the Leyland automobile in the 1970s and 1980s.\nThe article reported that the British Government ultimately spent--\nwell, transferring this or putting this in U.S. dollars--they spent\n$16.5 billion--that is comparable to what we are talking about now--to\nbailout the British automobile company called Leyland.\n  The article quoted a top official from the Thatcher government, which\nreluctantly but ultimately backed the bailout. He said:\n\n       I'm not telling the U.S. what to do, but the lesson of the\n     British experience is don't throw good money after bad.\n     British Leyland carried on for a few more years, but they are\n     not there now, are they?\n\n  No, Mr. President, they are not. They are bankrupt after burning\nthrough the taxpayers' bailout dollars.\n  Now, why we now believe Government bailouts and Government ownership\nof shares of these companies is going to be a successful venture\nwithout a clear idea of what these companies would do to significantly\nalter their business models, and at least until well into next year--I\ndo not\n\n[[Page S10893]]\n\nknow why we think this because it has not happened. It has not happened\nsuccessfully before.\n  In the New York Times, just a few days ago, Jeffrey Garten, who\nserved as Under Secretary of Commerce during the Clinton\nadministration, and who is now a professor at Yale University, was\nquoted as saying this:\n\n       We're at this moment in history, in which the Chinese are\n     touting that their system is better than ours with their mix\n     of capitalism and state control and our response, it looks\n     like, is to begin replicating what they've been doing.\n\n  Now, that is what he says we are doing: replicating now what the\nChinese have been doing. I have to say this: I am very much concerned\nabout the Chinese. I have spent quite a bit of time in Africa and other\nparts of the world. But in Africa, the Chinese, I think, pose the\ngreatest threat to us. It is an economic threat as well as a military\nthreat. But, nonetheless, does that mean we should be doing what they\nare doing? And we are replicating their system, according to Jeffrey\nGarten.\n  I cannot support Congress using taxpayer dollars to bail out yet\nanother industry. I can remember when we were talking about this a few\nweeks ago with the $700 billion bailout. We were talking about this as\nif this were something that was going to be a one-shot deal. I said,\nstanding on this Senate floor, that as soon as this goes through, they\nare going to start lining up.\n  I said: You are going to get not just the bankers, you are going to\nget the auto dealers and the airlines and everybody else out there\nsaying, well, if this is what is out there, bail me out, too. I want to\nbe bailed out.\n  So this is what is happening. We are now looking at one unelected\nbureaucrat administering a brandnew Government program with taxpayer\ndollars buying ownership in an industry. I think we have heard this one\nbefore. I know the American people have heard this before also.\n  This is exactly what Secretary Paulson did. I am talking about the\nmassive $700 billion financial bailout legislation. Let's keep in mind,\nwe are talking about an amount that is far less than that. We are\ntalking about $14 billion.\n  I remember talking on the Senate floor when it looked as though we\nhad $350 billion that was not going to be used. In fact, Secretary\nPaulson said--this was interesting--right before we went into recess,\nSecretary Paulson said: We have no intentions of using, no reason to\nuse the other $350 billion. We have a reserve that we have not spent\nyet of about $15 billion.\n  I responded and said: Well, if you do not have any intentions of\nusing it, let's go ahead and change the system so you cannot use it. I\ndo not want to have us adjourn and find out: Oh, I think we will use\nanother $350 billion, which is comparable to about $2,500 per family\nfiling a tax return.\n  Well, the Congress gave Secretary Paulson the $700 billion in two\ninstallments, and we all know how that second installment is. I have\nauthored two bills. One of them is S. 3683, sponsored by, of all\npeople, Bernie Sanders, the one who is a self-proclaimed socialist, a\nguy who is on the opposite end of the philosophic specter from me. Yet\nhe knows this is something that is wise: to have accountability for the\n$350 billion. I do not have her name on here, but I think Senator\nMikulski might also have been on here because I was on the Senate floor\nwith her, and she said it would be a good idea. We have Senators\nBarrasso, Wicker, DeMint, Roberts, and Vitter.\n  This legislation would freeze the unexpended expenditures of the\noriginal $350 billion and require an affirmative vote--is that asking\ntoo much--an affirmative vote to access the remaining $350 billion. It\nis automatic now. That is all we are asking for.\n  So I think that as we talk today--and, hopefully, this will be over\ntonight; I anticipate that it will because it goes on and on and on,\nand nobody, right before Christmas, wants to be working over the\nweekend when it looks like nothing meaningful is going to happen--let's\nbring it on, bring on the bill. Let's have a vote on it. Let's get it\nover with today, and, hopefully, we can reject it. think a lot of\nMembers in this body, some of those who supported the $700 billion\nbailout, have a chance at redemption right now by opposing this\nlegislation.\n\n  So, once again, let me just put it back in perspective. I came back\nfrom Afghanistan on the weekend and I saw the discussion take place,\nand I had an idea, through the experience I have on the Senate floor,\nthat nothing was going to happen for the next 2 or 3 days, so I went\nback to Oklahoma and talked to real people.\n  By the way, I have to say this: I talked to a lot of dealers in\nOklahoma about the idea of a car czar, and because of the prospect of a\nWashington bureaucrat telling the car manufacturers how to run their\nbusinesses and what kind of cars to make, it did not give them hope for\nthe future. These people were opposed to it. I know a lot of the car\ndealers are for this. They are concerned about keeping the parts\ninventories and all of that, but I look at this, and I don't see any\nother way it can happen.\n  By the way, I would say concerning this bailout bill, I don't think\nthey did anything to address the California waiver. This is something\nthat has to be done if they are really sincere about this bill that\ncame over from the House. Someone can correct me if they have corrected\nthe problems of the California waiver; I don't think they have. Right\nnow, there is litigation out there, where California wants to be able\nto determine what its tailpipe restrictions are. It is in the courts\nright now, but if they are successful, then that would mean we have 50\nStates that can determine what their emission requirements are in their\nState. You talk about one factor driving up the price of cars, that\nwould be it.\n  Again, I don't know for sure what all is in this thing from the\nHouse, but I do know this: The basic bill is the same bill that we had\nbefore. It is based on a concept that the bureaucracy can run the free\nenterprise system better than the free enterprise system can, and it\ndoesn't work. Let's solve the problem of the $14 billion, but let's get\nsome people to join in with me on the Senate bill that will allow us to\nrequire an affirmative vote for the second $350 billion.\n  Let's put that in perspective: $350 billion as opposed to $14\nbillion. I think it deserves the attention of the Members of the\nSenate.\n  Mr. President, I yield the floor and suggest the absence of a quorum.\n  The ACTING PRESIDENT pro tempore. The clerk will call the roll.\n  The assistant legislative clerk proceeded to call the roll.\n  Mr. ENSIGN. Mr. President, I ask unanimous consent that the order for\nthe quorum call be rescinded.\n  The ACTING PRESIDENT pro tempore. Without objection, it is so\nordered.\n  Mr. ENSIGN. Mr. President, I rise today to speak about the possible\nbailout of the Big 3 automobile manufacturers. General Motors,\nChrysler, and Ford have come before this Congress asking for tens of\nbillions of dollars from the taxpayers. This bailout, however, raises a\nnumber of questions that concern me greatly.\n  The economy of the United States is rooted in free-market principles.\nThese principles, coupled with our Nation's entrepreneurial spirit,\nhelped America become the richest and most innovative country in the\nworld. Even though our economy is struggling right now, we cannot\nabandon those principles.\n  American automobile company executives have made many poor decisions\nover the past few decades. Those decisions combined with a poor\neconomy, have put them in a desperate situation, particularly General\nMotors. It seems to me that this is exactly why we have Chapter 11\nbankruptcy. Now, when I say bankruptcy, I am not talking about\nliquidation. That is Chapter 7 bankruptcy. Chapter 11 bankruptcy\nprovides struggling companies with the opportunity to restructure\nresponsibly so that they can transform into efficient and profitable\nfirms. Chapter 11 exists to protect both the employees and the company\nitself by giving them a chance to get things right. The Big 3 should\nnot view Chapter 11 as some sort of death sentence. Instead, they\nshould see it as the best opportunity to put themselves on the same\ncompetitive footing with companies such as Toyota and BMW. Venerable\ncompanies in America such as Macy's and Continental Airlines have filed\nfor Chapter 11 and have emerged as stronger, more viable companies. So\nwhy should the Big 3 be treated any differently?\n\n[[Page S10894]]\n\n  I know these companies would say they are somehow unique and that\nbankruptcy simply will not work for them. I am not so sure about that.\nThe Big 3 worry that today's financial environment would prevent them\nfrom securing debtor-in-possession financing from the private sector.\nThey would need such funding to keep operating through a bankruptcy\nproceeding. This is where the government can step in. This would ensure\nthat automakers have the funds to complete the Chapter 11 process.\n  The Big 3 also worry that few consumers would buy a car from a\ncompany that might not be around in a few years to stand by the car's\nwarranty. Again, the government could step in and guarantee the\nwarranties. After all, what is a better backup of a warranty than the\nfull faith and credit of the U.S. Government? And if the government\ntook these steps, wouldn't that give the Big 3 a good chance to\nsuccessfully reorganize through Chapter 11 bankruptcy?\n\n  The Big 3 have testified before Congress that they would require\nabout $34 billion to avoid liquidation. They would need this help over\nthe next year or two. Many independent analysts, however, believe that\nnumber may triple that. Frankly, I am more inclined to believe the\nindependent estimates are closer to reality. After all, the Big 3 have\ntime and again proven unable to adequately plan for the future. Why\nshould we believe their projections now? With the deficit reaching $1\ntrillion or more next year, why aren't we having a debate over the true\ncost of such a bailout? We should be worried about the U.S. taxpayer.\n  In this legislation, there has been talk about creating a ``car\nczar'' to oversee any restructuring that would accompany a bailout.\nThis czar, however, would not have nearly the same sort of powers a\nbankruptcy court judge would have under Chapter 11. Injecting a\ngovernment bureaucrat into the process is not a serious solution. If\nyou have been around Washington long enough, you know it is more like a\nserious problem. Wouldn't it be better to have an expert such as a\nbankruptcy court judge oversee the process?\n  Not only would a bankruptcy judge have more tools than a car czar,\nbut the judge would not be influenced by the political process. A\nbailout would invite all sorts of meddling from lawmakers to have the\ncompanies carry out their own pet policies. We should not be using this\nbailout as a vehicle to implement domestic social policy.\n  Not to mention that creditors or stakeholders will just lobby\nCongress to make the sort of concessions that would be required of them\nunder the bankruptcy. We see this sort of lobbying right now with the\nTARP program. Everyone is trying to tweak the program to benefit their\nown narrow self-interest. Why would we expect the auto unions or\nsuppliers or dealers to behave any differently? I worry that\npoliticizing the restructuring of the Big 3 would jeopardize any\nchances of success they may have.\n  All this talk of government-directed restructuring also raises bigger\npicture questions. Why does Congress think we can succeed where so many\nbusinessmen have already failed? What sort of experience in the car-\nmaking business does this Congress have? Last I checked, none of my\ncolleagues have a background in running a car company. And this car\nczar seems doomed to failure too. One government bureaucrat to oversee\nthe reorganization of three massive companies? What track record can we\npoint to that makes us think this will work?\n  This strikes me as a questionable intervention by the government into\nthe private sector. We have the government thinking it can run these\nbusinesses better than they can. Heck, we cannot even run the\ngovernment. We also have the government choosing which individual\ncompanies deserve help and which do not. This is not what the\nGovernment should be doing. Government should not be picking winners or\nlosers in the private sector. For the long-term health of the country's\nentrepreneurial-based economy, this could be a dangerous precedent.\n  One of the companies asking for a bailout is Chrysler, which is owned\nby an investment fund known as Cerberus. Some reports indicate Cerberus\nmay have significant asset holdings, into the billions of dollars. But\nit appears Cerberus has done nothing to infuse any emergency cash into\nChrysler to save it. Why should the government bail out Chrysler, when\nits own parent company seems unwilling to offer any help?\n  If we bail out the car companies, what does that mean for other\nstruggling industries? The automakers are not the only ones suffering\ntoday in this bad economy. Would we have to bail out every large\ncompany in every major industry? Tourism is one of America's biggest\nindustries and has a high employment multiplier, much like the auto\nindustry. Hotel rooms are going empty as consumers cut back on travel.\nMany state economies, such as in my own State of Nevada, are hurting\nbecause of the downturn in consumer travel. Should the hotels receive a\nbailout? How about the newspaper industry? We know their businesses are\nhurting too. The Tribune Company filed for Chapter 11. Should we be\nbailing them out as well? Where do we draw the line? Can we even draw a\nline once we have given the Big 3 a bailout?\n  The proposed automaker bailout is indicative of a big-government\napproach to dealing with our economy. We are in the midst of a\nrecession, yet we have come back for a late session of Congress to talk\nabout saving just three companies. Why aren't we considering pro-growth\npolicies to help the larger economy? We should be considering long-\nterm, pro-growth tax cuts rather than searching for ways to spend more\nof the taxpayers' money. For instance, lowering the corporate tax rate\nwould put more money back into the hands of companies all across\nAmerica. This would help companies stay afloat and to avoid cutting\njobs during these difficult times. Instead, the Democrats are looking\nto spend money on bloated, uncompetitive automakers.\n  As we debate whether to loan billions of dollars to the automakers, I\nurge my colleagues to consider all the important questions I have\nraised today. This issue is not as simple as answering ``how many jobs\nmight be lost?'' or ``how much it will cost the government?'' We must\nalso consider questions such as ``what is the Government's proper role\nduring this economic downturn?'' ``What could be the unintended\nconsequences of our actions?'' ``Are we setting a dangerous precedent\nfor needless political intervention?'' ``How might this affect our\nballooning deficit?'' ``Are we taking the best course of action for the\nlong-term health of the U.S. Government?''\n  We would do America a disservice by approving any bailout package for\nthe Big 3 before finding at least some consensus on these questions.\nFurthermore, I believe we must look more closely at Chapter 11 as a\nviable option for the automakers. Chapter 11 reorganization for any of\nthe Big 3 is far from ideal, but we do not live in an ideal world nor\nduring ideal times. We should not dismiss one of the most powerful\ntools available to us so readily.\n  I hope my colleagues will think long and hard about the issues I have\nraised today before making any decisions about the possible bailout. If\nthis bailout package that is before us today fails, we can rewrite the\nbill and do it in a way that is better for the U.S. auto manufacturing\nindustry. American taxpayers deserve nothing less.\n  Mr. President, I yield the floor and suggest the absence of a quorum.\n  The PRESIDING OFFICER (Mr. Brown). The clerk will call the roll.\n  The legislative clerk proceeded to call the roll.\n  Mr. CARDIN. Mr. President, I ask unanimous consent that the order for\nthe quorum call be rescinded.\n  The PRESIDING OFFICER. Without objection, it is so ordered.\n\n                          ____________________"]], "columns": ["granule_id", "date", "congress", "session", "volume", "issue", "title", "chamber", "granule_class", "sub_granule_class", "page_start", "page_end", "speakers", "bills", "citation", "full_text"], "primary_keys": ["granule_id"], "primary_key_values": ["CREC-2008-12-11-pt1-PgS10890-4"], "units": {}, "query_ms": 1.407428877428174, "source": "Federal Register API & Regulations.gov API", "source_url": "https://www.federalregister.gov/developers/api/v1", "license": "Public Domain (U.S. Government data)", "license_url": "https://www.regulations.gov/faq"}