S10608 CONGRESSIONAL RECORD — SENATE November 19, 2008 

auto industry. Although our friends on 

the other side have been talking about 

this issue with increasing frequency, 

they have yet to indicate how they 

plan to move forward. There is clearly 

a deep controversy about using funds 

designed to strengthen our credit markets to shore up distressed companies 

and other industries. We all understand 

that. It is one of the main reasons why 

there is still a significant lack of support from both sides of the aisle to that 

particular kind of approach. 

It is an understatement to say there 

is deep concern about the impact of 

more than $100 billion of new deficit 

spending in the bill that has been put 

forward. So let me suggest a bipartisan 

path forward that has not yet been offered by the majority. It is a compromise being worked on by Senators 

VOINOVICH and BOND which reproposes 

funds already appropriated, money we 

have already appropriated to fund a $25 

billion loan program for auto makers 

to build advanced technology vehicles—coupled with new taxpayer protections and Federal oversight about 

how the money is spent. This is a proposal which I believe has support from 

both sides of the aisle and that actually has the potential to pass right 

now, not next year. There is a way forward that will help protect the jobs in 

the auto industry while also protecting 

the taxpayers. Senators VOINOVICH and 

BOND are working with colleagues 

across the aisle to protect taxpayers 

and our long-term economic health. 

Should this compromise approach be 

approved by the Congress, it is the only 

proposal now being considered that we 

believe President Bush will sign. It 

could actually become law and become 

law in the very near future. 

As we move forward, we must do so 

in a bipartisan way on this and the 

myriad of other issues to come, and a 

good place to start would be right now. 

I yield the floor. 

f 

RESERVATION OF LEADER TIME 

The ACTING PRESIDENT pro tempore. Under the previous order, the 

leadership time is reserved. 

f 

MORNING BUSINESS 

The ACTING PRESIDENT pro tempore. Under the previous order, the 

Senate will proceed to a period of 

morning business, with Senators permitted to speak up to 10 minutes each. 

The Senator from Louisiana is recognized. 

f 

AUTO INDUSTRY BAILOUT 

PROPOSALS 

Mr. VITTER. Mr. President, I rise to 

express my grave concerns about all of 

the auto industry bailout proposals. I 

do that for two fundamental reasons. 

First of all, I am very concerned of this 

ever-widening bailout fever, bailout 

mania. We are now going well beyond 

the financial industry. We are crossing 

what was supposed to be a bright line 

and going to other sectors of major 

manufacturing, starting with the auto 

companies, but I am convinced it certainly will not end there. 

The second reason I am very concerned is for the sake and future of the 

auto companies and those workers 

themselves, because I am convinced 

that if we pass this type of bailout proposal, it will not save the auto companies, it will absolutely ensure their demise. That is because it is a bailout 

that is not coupled in any way with 

fundamental restructuring and fundamental reform. 

Let me go back to the original financial industry bailout proposal. On September 29, I announced my strong opposition to that, based on many reasons which I articulated here on the 

Senate floor. One of them was that I 

thought it would invite many more 

bailouts to come. As I said, it was ‘‘an 

unprecedented government bailout 

that will almost certainly pave the 

way for even more, maybe sooner rather than later.’’ 

Even as I spoke then on September 

29, quite frankly I never would have 

guessed that we would be at that point 

now, so soon, a few weeks later. But we 

are. Again, what started as an idea 

about the banking industry—don’t let 

it fail; only about financial services industries—is now ever widening. 

First of all, it has been widened within the TARP program itself, because 

while Treasury Secretary Paulson 

came to Congress, came to Capitol Hill 

with a very clear message of what that 

program was about—buying bad assets, 

taking them off the books of financial 

companies—even within that program 

we have already moved on to plan B, 

which is infusing money directly into 

banks. And now we are moving on to 

plan C, infusing money into other sectors such as consumer credit cards, 

student loans, and other ventures. So 

even within that TARP bailout structure we have expanded the bailouts and 

moved on from plan A, which was the 

entire premise on which Congress 

passed the legislation, to plan B and to 

plan C. 

Now we are about to cross a much 

brighter line and we are potentially expanding this bailout fever much more 

by going well beyond the financial industry, by going well beyond the banking system, well beyond the promise we 

simply need to stabilize the banking 

system, to now saving companies because they are big, because they are, in 

a word, too big to allow to fail. 

I think that is a fundamental mistake. But as I said, the other reason I 

think it is a fundamental mistake has 

to do with the companies’ futures and 

the workers’ futures themselves. I 

think this auto industry bailout proposal is a fundamental mistake because I believe it will not only not save 

those companies, but I believe it will 

absolutely doom them to eventual failure—yes, a few months later rather 

than now, but will absolutely doom 

them to eventual failure. 

Why do I say that? For a simple reason; because these proposals are not 

coupled in any way with the fundamental restructuring that the American auto companies need to become 

competitive and to survive. 

A few weeks ago when we talked 

about the financial crisis, we were focused on just that, a financial crisis 

within the banking industry, within financial institutions. That was about 

credit freezing up and impacting the 

economy in an overall way. But of 

course auto companies’ problems and 

challenges predate that by years and 

years. Certainly the financial crisis 

made their immediate situation worse, 

made their immediate straits more 

challenging, but their ultimate challenge and their ultimate troubles have 

nothing to do with this immediate financial crisis. They have to do with 

the legacy costs and very high labor 

and other costs that those companies 

are burdened by, which makes them 

fundamentally uncompetitive with 

their worldwide competitors today. 

What am I talking about? That extra 

burden brought on by legacy costs and 

union obligations is estimated to be 

about $2,000 per car for the big three 

auto manufacturers—$2,000 per car. 

What does that mean? What it means is 

Ford, for example, needs to cut $2,000 

worth of features out of its Taurus to 

compete with, say, Toyota’s Avalon. It 

is no surprise that the Avalon feels like 

a better product. It is a better product. 

It has $2,000 more features, in terms of 

comparable sales prices, when it goes 

to the lot. Of course it is going to be a 

better product. 

Another example is the U.S. auto 

companies and their unions admit that 

union demands have driven up labor 

costs at the big three U.S. auto manufacturers to $30 per hour more than 

their foreign-owned competitors, including competitors such as Toyota 

that employ Americans and produce 

cars in America right here and now. 

How can the big three possibly remain competitive in a worldwide economy with that sort of disadvantage? 

And throw on top of that the fact that 

the CEO of GM managed to get a 64- 

percent pay raise recently despite his 

company’s shares dropping more than 

90 percent over the past 52 weeks. That 

is not a recipe to stay or become competitive, that is a recipe for failure. 

The reason the auto companies will 

be doomed to that failure if we pass 

this bailout is because we are giving 

them plenty of taxpayer dollars without demanding the fundamental restructuring, the fundamental revisiting 

of those additional costs, these extraordinary labor costs, those burdensome legacy costs that it will take to 

make them competitive on a worldwide 

stage. 

My argument is very simple: Let’s 

not cross that bright line. Let’s not expand in a fundamental way bailout 

fever for the good of our free market 


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