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Auto Bailout Unlikely Until Obama Takes Office

Detroit automakers warn that next year may be too late for rescue

By Rob Quinn, Newser Staff

Posted Nov 14, 2008 2:55 AM CST

(Newser) – It’s looking unlikely that a new economic stimulus package and a Detroit bailout will happen this year, the Wall Street Journal reports. The proposals are facing stiff resistance from Republicans and may have to wait until the new, more heavily Democratic Congress convenes in January and Barack Obama takes office. Democrats are leery of introducing a proposal that may face a veto from Bush.

Industry experts warn that one or more of Detroit's Big Three may collapse before then. GOP leaders are unsympathetic, calling the proposal to throw a $25 billion lifeline to uncompetitive automakers "neither fair to taxpayers nor sound fiscal policy." Senate Majority Leader Harry Reid has vowed to push for the legislation despite partisan resistance, saying the automakers are a vital part of the nation's economy.

[Images (3)]

[Quotes (2)]

The General Motors headquarters at dusk in Detroit yesterday. GM says it may run out of cash before the end of the year without government help. (AP Photo/Carlos Osorio)

The General Motors Renaissance Center headquarters building in Detroit. (AP Photo/Paul Sancya/file)

Senate Majority Leader Harry Reid talks on the phone as he heads to his office on Capitol Hill last week. Reid is pushing hard for a package to bail out Detroit automakers. (AP Photo/Susan Walsh)

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I'd want to be careful about bringing up a proposition that might fail. There's some political considerations that need to be made over the
next few days. - Senate Banking Committee Chairman Christopher Dodd

The financial straits that the Big Three find themselves in is not the product of our current economic downturn, but instead is the legacy of the uncompetitive structure of its manufacturing and labor force.
- Rep. John A. Boehner, R-Ohio

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Auto Bailout Unlikely Until Obama Takes Office