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Congress' Big Auto Bailout Mired in Red Tape
Money coming later rather than sooner
By Kevin Spak
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Posted Oct 22, 08 9:59 AM CDT
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(Newser)
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Detroit's $25 billion loan is sitting in Washington, the Washington Post reports, and may take more than a year to distribute, despite the auto industry's increasing desperation for the cash. The Energy Department, which was tasked with doling out the money, says various legal and administrative requirements will drag the process out 6-18 months. “Congress had the opportunity to waive these requirements,” said a department spokeswoman, but “has chosen not to.”
Auto-state lawmakers are outraged. “It's inexcusable and inexplicable that they cannot get these loan guarantees out there faster,” says a spokesman for one. Michigan Sen. Carl Levin, meanwhile, wants to put more money for automakers in the upcoming stimulus package. But that money wouldn’t come any faster, and the auto industry needs the money now—GM lost $15.5 billion last quarter, and JD Power thinks 2009 may see an “outright collapse” in the global auto market.