Bailout Agreement Awaits Vote

CBS

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late last night Congressional Democrats and the White House reached an agreement in principle on a bailout plan for the Auto industry CBS News correspondent Thalia assus is on Capitol Hill with the details this morning good morning Thalia good morning Maggie it came after a two-hour conference call in which White House and Congressional staffers went over the 35-page proposal line by line White House and Congressional staffers burned the Midnight Oil hammering out this rescue plan the deal would speed $115 billion in government loans to the struggling us car makers for their part they would develop long-term restructuring plans and submit them to Congress for approval it would also create a carar who would have the authority to pull back the money if the companies don't move quickly enough to reinvent themselves the proposed deal offers only short-term financial help to GM and Chrysler and Falls far short of the $34 billion the automakers requested last week There's no appetite for that here with all due respect these are self-created problems but Senator Dodd has said that if the restructuring plans look good more help could be on the way we're going to create by March 31 we hope a profitable and viable automobile industry for this country and more help is precisely what critics fear if you give them the cash they'll do what they have to to get it from you and you'll find they'll be back over and over again this is going to cost you hundreds of billions of dollars get ready for this could go to the house today for a relatively easy vote in the Senate there could could be some roadblocks Maggie paliurus thank you whether it passes could depend on how Republican lawmakers feel about this tentative deal are they likely to vote in favor or try to stop it we're putting that question this morning to Senator Bob Corker republican from Tennessee good morning Senator good morning Maggie how are you fine thank you let me ask you will you vote for or against this bailout well you know I always want to read the details but based on what I know uh I cannot support it it's as if the the Administration has snatched defeat from the jaws of Victory there's a wonderful opportunity here to greatly reduce the GM debt through getting their bond holders to take about 30 cents on the dollar to cause these companies to immediately to get their wages in line with Nissan and Toyota and Honda and those other companies here that are being successful and to cause the UAW to take uh part of what's owed to them in equity which would again greatly reduce the amount of money GMOs without that there's no way they can be viable Senator Corker for our viewers who are familiar with the details you're talking about 62 billion of debt that General Motors has is your fear that with such a huge debt there's no way uh that we could tackle that without giving them another huge loan that 50 billion is not where it ends that that's exactly right look if if the US government is going to be a lender let's make sure that we get their balance sheet straight on the front end once us tax dollars got start going into these companies it's going to be very difficult to to cause that to happen so I've tried to offer for a plan that keeps them from going into bankruptcy but I'm beginning to believe that maybe the only way for them to to do what needs to happen is through that process which we've worked to try to avoid but uh I'm not sure this is going to pass I actually thought last night that it might bumped into some Senators on our side that you know from time to time have a t tendency to lean and and do these kind of things I don't know that this is going to pass and there are some Democratic senators that are not present so my sense is uh we may be back to page one I don't know we'll see in a few days certainly all right in the last 20 seconds if it does pass this is just intended to keep GM and Chrysler float until March 31st what do you predict happens after that uh a whole lot of money a whole lot of money from us all right Senator Bob Corker thank you thank you [Music]

Progress But No Deal

CBS

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that this is a bridge to either fundamental restructuring or bankruptcy they either have a long-term plan that's viable or we get our money back and if we call our money back which is required under this bill then those firms are not going to be able to survive that is a real incentive and a real stick for this president's designee to ensure that these stakeholders all across the board make the concessions that are necessary we've had concerns about the legislation and we wanted to make sure that it was tough and that this was not a bridge financing to know where it's not a lifeline to continue with bad management in a bad business plan we're going to go make that same case to the Senate Republicans the House Republicans and the Democrats for that matter who also are going to need to be called upon to vote for this

Vitter: Bailout is 'Backwards'

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this proposal at its core is about giving these companies 15 billion of loans 15 billion dollar on the promise of a detailed restructuring plan yet to come so we give them significant amounts of money $15 billion so that they go through that process so that they start that discussion so that they come back to us months later with a detailed restructuring plan well my reaction to that is pretty simple I think the average American could say would say what isn't that putting the cart before the horse isn't that to use a common phrase just ass backwards Mr President let me say bluntly I have no confidence absolutely no confidence in the present management of these three companies but let me also say Mr President if there's a way for that to go from bad to worse it is by injecting into the process politics and a political appointee like this so-called car Zar that would make a very bad situation very much worse

Auto Bailout

CBS

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it's the holiday shopping season here in New York and yeah I'd like a car or a bailout what do you think about the Auto industry bailout you got to do it no question I believe in free economy um government shouldn't help out what's not there is to help out you know I don't know if it's going to really help them well I don't agree with it but if they don't grant them the bail out I think the economy is going to collapse even further we can really do without the Auto industry being bailed at other people should be bailed out I'll be honest with you we were just dealing with layoffs at our job today so we're not I don't really care about the Auto industry right now I'm sorry first they went over there with their private jets and then they want to come back with the hybrids bull they don't need no money these um executive need to take responsibility we need some good management team managing these companies because if if management ising a poor job then the burden is on us the taxpayers frankly I don't think the government should be involved in the private sector in uh society that adhered to our Constitution that would not happen I think it's why they don't deserve any money I think the Japanese car makers uh blew them away and uh they made bad choices and now they want to get bailed out I mean they run their business into the ground like you know if I run my business into the ground I can't go to the government for a loan so sure who's going to be there to save your ass exactly nobody nobody maybe the hot dog might help probably not actually it's a hot dog I work for a Honda dealer but um I don't know I I hope they get the money I'm praying they get the money so how would the money help them at this point how would it help them at this point oh my God I mean I think it would do wonders I mean everybody's in trouble save a lot of jobs everyone's going to want to bail out but in the same token there's a lot of jobs to be lost if they don't get it that's people have to feed the family they got kissed and Christmas coming so come on so we need to do something to help them only if we can get the money back only Al loone okay do you think they would actually loan them the money and actually expect to get it back uh knowing our politicians probably not we're going to we'll be the losers in a long run I think they're as deserving of a bail out as Wall Street bye bye is that your new headset no oh do all your friends have the same haircut no oh okay why are you in the zone Chief I will be later tonight okay all right

Detroit Needs A Comeback

CBS

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at the consumer reports track in Connecticut the new Chevy Malibu is taken on a challenging test drive in its latest issue the Magazine recommends the Malibu and during the Congressional bailout hearings last week Ford CEO Alan malale bragged every one of our new vehicles now is equal to are better than the competition Detroit's big three have made big games in quality says the man who test drives these cars for Consumer Reports but they still have some catch up to do the top cars are still coming from basically Honda and Toyota in the Magazine's latest survey of owner satisfaction the top 27 ranked automobiles included only three from the big three two Chevy Corvette models and the Cadillac CTS and a new brand loyalty survey by JD Power shows nearly 2third of Honda and Toyota owners stick with the same manufacturer when buying a new car but only half of Ford and Chevy buyers do and for Chrysler it's just a third you really in today's day and age need to have everything spot on for a car to be successful in the market so Detroit desperately needs an overnight sensation but the industry which must sell 15 million Autos a year to be profitable is on Pace to sell only 11 million are these plans that the automakers put on the table enough to return them to profitability and viability long term no they've done a a lot of work in the product portfolio um but still more needs to be done and it needs to be accelerated but developing a new car takes years of design and planning to climb back to the top of the market Detroit needs what now seems to be slipping away time Anthony Mason CBS News New York

GOP Wary Of Auto Bailout

CBS

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with the multi-billion dollar auto bailout package still on the political assembly line opponents on capitol hill are railing against what they call a taxpayer-funded travesty unless chrysler ford and general motors become lean and innovative and competitive in the marketplace this is only delaying their funeral senate republicans threatened to stall the deal while democratic leaders in the white house pushed even harder to provide up to 14 billion in emergency loans automakers would be under the thumb of a presidentially appointed car zone that karzar could veto industry expenditures and even pull the plug on the whole bailout if automakers don't submit restructuring plans by march 31st spelling out how they've become more viable competitive and energy efficient with general motors warning it could be broken two weeks democrats bowed to the white house and backed off demands that car companies give up lawsuits challenging higher fuel efficiency standards that seem to resolve a major sticking point clearing the way for a houseboat as early as tonight the cost to our economy a failure of one or more of these companies will be stark but the auto lifeline still faces bigger hurdles in the senate where opponents say taxpayer money should not be spent up front before the industry is forced to make changes isn't that putting the cart before the horse isn't that to use the common phrase just ask backwards the white house sent vice president cheney and chief of staff josh bolton to the hill today to twist republican arms but we're told they didn't have much luck katie bob orton washington thank you bob you

Congress debates $15B auto bailout; 91% say economy bad

CBS News

Transcript

stocks managed a slight rally even though Congress is struggling to work out a $15 billion bailout for the Auto industry the Dow added 70 points after rallying triple digits earlier the NASDAQ Rose 18 a new CBS News poll finds more people than ever have a negative view of the economy 91% of American surveyed say it's in bad shape a third of those polls say their concerned someone in their household could lose a job in the next year and when it comes to bailing out fin cial institutions 45% say that should ultimately help the economy key lawmakers blasted the treasury for its handling of the $700 billion doll rescue plan at a congressional hearing they said the bailout hasn't convinced Banks to loan money again and hasn't prevented a wave of forclosures there are now growing calls to have at least some of that bailout money go directly to Consumers Eastman Kodak is feeling the pinch it's freezing salaries for executives and temporarily suspending its 401K match as consumers cut back spending the tight credit Market is making it hard for kodak's business customers to finance new equipment and even the NFL can't escape the recession the league is slashing 150 jobs that's 14% of its staff the NFL has been enjoying revenues of more than $6 billion dollar a year but the league is worried the recession will put a dent in ticket sales next season at the New York Stock Exchange I'm Alexis christopherus