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House OKs $25B Detroit Rescue

Package of low-interest loans aims to prop up staggering auto industry

By Rob Quinn, Newser Staff

Posted Sep 25, 2008 3:29 AM CDT

(Newser) – The House has approved a $25 billion lifeline to Detroit's battered auto industry, the Detroit Free Press reports. The package of low-interest loans to help automakers switch to manufacturing more fuel-efficient vehicles is expected to be approved by the Senate today and signed by the president soon after. Michigan lawmakers cheered the news, saying it would save thousands of jobs.

The deal dwarfs the $1.2 billion bailout of Chrysler in 1980, but it gained political support as $25 billion began to look trifling in comparison to the money spent to save financial firms. Michigan politicians—who plan to press for another $25 billion—bristled at the term "bailout," insisting that the deal is vital for America's interests and that, unlike the Wall Street giants, they plan to pay the money back.

[Images (3)]

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United Auto Workers talk outside a union meeting in Detroit earlier this year. (AP Photo/Paul Sancya, File)

Chrysler and Dodge vehicles are lined up at a Chrysler dealership in Portland, Ore. (AP Photo/Rick Bowmer, file)

Jeep Grand Cherokees and Commanders are staged for transportation on truck and train at the Chrysler Jefferson North Assembly facility in Detroit. (AP Photo/Paul Sancya)

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It’s been a struggle here in Washington to secure an acknowledgement that a domestic-based auto industry is vital for America. What this does is to embody that idea. - Rep. Sander Levin, D-Royal Oak

There are those who will lump it in with the bailouts. That’s garbage. I know people are still saying it. I hear it every time I walk down the hall. - Rep. Joe Knollenberg, R-Bloomfield Township

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House OKs $25B Detroit Rescue