WASHINGTON (AP) - A $14 billion emergency bailout for U.S.
automakers collapsed in the Senate Thursday night after the United
Auto Workers refused to accede to Republican demands for swift wage cuts.
The collapse came after bipartisan talks on the auto rescue
broke down over GOP demands that the United Auto Workers union
agree to steep wage cuts by 2009 to bring their pay into line with
Majority Leader Harry Reid said he hoped President George W.
Bush would tap the $700 billion Wall Street bailout fund for
emergency aid to the automakers. General Motors Corp. and Chrysler
LLC have said they could be weeks from collapse. Ford Motor Co.
says it does not need federal help now, but its survival is far
The White House said it was evaluating its options in light of
"It's disappointing that Congress failed to act tonight," a
White House statement said. "We think the legislation we
negotiated provided an opportunity to use funds already
appropriated for automakers and presented the best chance to avoid
a disorderly bankruptcy while ensuring taxpayer funds only go to
firms whose stakeholders were prepared to make difficult decisions
to become viable."
The Senate rejected the bailout 52-35 on a procedural vote after
the talks collapsed.
The implosion followed an unprecedented marathon negotiations at
the Capitol among labor, the auto industry and lawmakers who
bargained into the night in efforts to salvage the auto bailout at
a time of soaring job losses and widespread economic turmoil.
The group came close to agreement, but it stalled over the UAW's
refusal to agree to wage cuts before their current contract expires
in 2011. Republicans, in turn, balked at giving the automakers
Reid called the bill's collapse "a loss for the country,"
adding: "I dread looking at Wall Street tomorrow. It's not going
to be a pleasant sight."
"In the midst of already deep and troubling economic times, we
are about to add to that by walking away," said Sen. Chris Dodd,
D-Conn., the Banking Committee chairman who led negotiations on the