Auto Industry Financing and Restructuring Act

AUTO INDUSTRY FINANCING AND RESTRUCTURING ACT -- (House of Representatives - December 10, 2008)

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Mr. WILSON of South Carolina. Mr. Speaker, I think it is reasonable to assume that I am not alone when I say that my office has been contacted with hundreds of phone calls and e-mails asking Congress not to spend billions more to bailout the Big 3 American automakers. Congress has already asked the American taxpayer to stomach a $700 billion package of economic relief aimed at unfreezing the credit markets. It is wrong to ask American families to trust that billions in bailout relief for three specific companies will do anything but cement a dangerous and expensive precedent for future big government spending and control of a vital industry in America.

In fact, at this time the credit markets have not been unfrozen after the onslaught of this recent economic downturn, and I hope Congress, this current administration, and the incoming administration will ensure that the programs we have passed into law already are implemented and reviewed. Recent reports of a failure to adequately utilize the oversight mechanisms outlined in the economic rescue package are troubling. The taxpayers deserve to know that we are following the letter of the law.

Nevertheless, the debate today is on whether we should give $15 billion dollars to help shore up the books of General Motors, Ford, and Chrysler. The primary argument that continues to be made in support of this bailout is predicated upon the claim that bankruptcy is not an option. Never mind that other companies and industries--most notably the members of the airline industry--have successfully emerged from bankruptcy stronger, more agile, and successful. We have a bankruptcy process in place, the sole purpose of which is to deal with circumstances similar to those that GM, Ford, and Chrysler face. Unfortunately, in typical Washington fashion, Congress wants to reinvent the wheel and create a new process and a new bureaucratic office in the form of a ``Car Czar.'' Such a redundant proposal would be slightly less harmless were a $15 billion taxpayer funded price tag not tacked onto it. But it is.

The bankruptcy process that already exists does not spell the end of a company or the loss of every one of their jobs. The scare tactics that have been spread around that without this multi-billionaire bailout, the American auto industry would disappear is just not the case. In fact, bankruptcy procedures would allow the companies to restructure to make them competitive in the global market. Bankruptcy is never an ideal situation for any company but it is far more preferable to spending billions of taxpayer dollars and ceding control to big government.

It should be noted that opposition to this massive bailout is not a commentary on my or my colleagues' support for the American auto industry. We represent American automotive dealerships, American automakers, parts manufacturers, the people they employ, and in many instances, we own American automobiles. We want to see these companies prosper, build the future fleet of automobiles for the world to drive, and continue to employ millions of hardworking Americans. What many of us are unwilling to accept is the suggestion that taxpayers need to be signing the check to keep particular businesses in a particular industry afloat when there is a sound, bankruptcy process already available.

It is clear from every angle that the American auto industry needs to make some dramatic changes to their business model and to the current agreements they have with the unions who represent their employees. These changes will make them financially stronger and more competitive. It will help protect current and future employees. They can accomplish this without a taxpayer funded bailout, and it would be unwise to betray the interests of American taxpayers by choosing to simply throw money at the problem.

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