Congressional Republicans Attack Obama's Rescue Plan For GM
01 Juni 2009 - 9:50PM
Dow Jones News
Republicans on Monday attacked the Obama administration's plans
for U.S. ownership of General Motors Corp. (GM) as excessive
government interference in private industry and said they would
push for more oversight of government rescue programs.
GM's government-financed bankruptcy "may buy some time but does
nothing to ensure GM's success," House Minority Leader John
Boehner, R-Ohio, said in a statement. "The only thing it makes
clear is that the government is firmly in the business of running
companies, using taxpayer dollars."
Boehner criticized the administration for not presenting a plan
for when and how the government would divest its expected 60%
equity stake in the revamped GM.
Rep. Jeb Hensarling, R-Texas, said he would push for greater
congressional oversight of the government's Troubled Asset Relief
Program, which will have provided $50 billion to GM under Obama's
plan.
Hensarling, who sits on the Congressional Oversight Panel,
created to oversee the TARP, said he has asked the committee's
chairwoman to hold a hearing on the matter but hasn't received a
reply.
"Now we have the People's Republic of GM, owned by the taxpayer,
who I'm not sure wanted their loan converted to equity in the first
place,"said Hensarling, pointing out that the financial rescue
program was intended to help the financial system, not industrial
companies.
"If there was ever a use of TARP money that cried out for
congressional oversight," Hensarling added, "this is it."
Recent polls show public support lagging for more government
assistance to GM, with Rasmussen Reports saying Sunday that 21% of
Americans supported a rescue of the auto maker.
Republicans saw a political opportunity in President Barack
Obama's announcement Monday that the administration would provide
$30 billion in new aid to GM, on top of $20 billion already given
the company.
The Republican National Committee posted a video on its Web site
Monday titled "Government Motors." It was accompanied by a scathing
statement from RNC Chairman Michael Steele, who called the
administration's plans for GM "nothing more than another government
grab of a private company and another handout to the union cronies
who helped bankroll his presidential campaign."
Rep. Candice Miller, R-Mich., whose district has been battered
by the auto industry's troubles, detracted from members of her
party, calling Obama's plans for GM "the only responsible step
forward."
"I understand their ideology," Miller said of fellow Republicans
in an interview. "But to be so rigid with no compassion for working
men and women who are losing their jobs, people who have invested,
who have lost their capital, and the continued pain by suppliers
and auto dealers and others, I think it's an ideology. And I am
applauding the auto task force and this administration for stepping
up and doing the right thing."
Miller said the lack of public support for the rescue showed
that Obama was not influenced by politics, adding, "How is it
helping him?"
Democrats, meanwhile, defended the president's plan as necessary
to save jobs.
"The ultimate outcome of today's announcement, GM's survival and
rebirth, is by far a better outcome than the alternative of GM's
liquidation," Sen. Carl Levin, D-Mich., said in statement.
Senate Majority Leader Harry Reid, D-Nev., called the bankruptcy
filing by GM a "regrettable but necessary step to ensuring the auto
industry remains the core of our domestic manufacturing base."
"President Obama's decision to take a short-term stake in
General Motors is driven by our nation's shared interest in
ensuring the American auto industry can survive," Reid said in a
statement.
-By Josh Mitchell, Dow Jones Newswires; 202-862-6637;
joshua.mitchell@dowjones.com