Congress takes first step on automaker bailout

WASHINGTON (Reuters) - Senate Democrats took the first step toward bailing out the nation's crippled auto industry on Monday by proposing a $25 billion loan program, a plan that faces stiff political headwinds with millions of jobs potentially riding on the outcome.

With the year's congressional calendar down to a few days, lawmakers and the Bush administration sparred over the best way to extend help to General Motors Corp, Ford Motor Co and Chrysler LLC.

"We're surprised that Senate Democrats would propose a bailout that fails to require automakers to make the hard decisions needed to restructure and become viable," White House spokeswoman Dana Perino said.

The Senate bill would, however, impose conditions. The government would take warrants for shares in exchange for aid, which would come with limits on executive compensation and a prohibition on the payment of dividends.

Automakers would also have to submit plans on how they intend to remain competitive, pummeled by plunging sales, little access to credit and a weakening economy.

Executives from the three companies are expected to amplify their calls for help at congressional hearings beginning on Tuesday.

Carl Levin of Michigan, the plan's chief advocate in the Senate, said the proposal to amend the Treasury Department's existing $700 billion rescue plan for financial services firms is the most efficient way to help auto manufacturers.

House Democratic leaders, led by House Financial Services Committee Chairman Barney Frank, released a draft of almost identical legislation later on Monday.

But the White House and many Republicans favor amending another law -- one approved in September to extend automakers $25 billion in technology loans to retool factories and make more fuel efficient cars.

MARKET FEARS

A rescue package for U.S. automakers could avert another stock market plunge like the one seen after Lehman Brothers' collapse in September.

"The reason people think failure could be cataclysmic is that there are so many companies that are tied to the auto industry," said Marc Pado, U.S. market strategist at Cantor Fitzgerald & Co in San Francisco.

The Senate proposal comes as GM said it would delay incentive payments to its U.S. dealers by two weeks in an effort to "gain some cash liquidity" for the fourth quarter.

The payments for dealer incentives, which are made on a weekly basis, will be delayed from November 28 until December 11, GM spokesman Pete Ternes said.

Liquidity is the key concern for the automakers as their remaining cash reserves dwindle.

"If General Motors is unable to solidify government aid this week and is forced to wait for the next administration, we would become more concerned about working capital related liquidity risks... ," Citigroup autos analyst Itay Michaeli said in a note to clients on Monday.

The companies and their allies in Congress argue a bailout is justified on grounds they back one in 10 U.S. jobs.

GM, Chrysler and Ford employ close to 250,000 people in the United States and supporters claim they touch more than 4 million other jobs including suppliers, dealers, car haulers and rental companies.

Many parts suppliers and dealers have agreements with transplanted automakers as well, potentially interrupting the business of competitors to the Big Three in the short term.

A potential threat to the integrated supplier network prompted Japan's Honda Motor Co Ltd to support an aid package for its U.S. rivals.

BAILOUT SKEPTICISM

But segments of the public disagree that a rescue is in order. In interviews, Americans said the planned rescue was unfair and would make it harder to reform the U.S. automakers.

"They need to restructure. If they get bailed out they are not going to do it," said Eric Smith, a paint contractor interviewed in Chamblee, Georgia, on the outskirts of Atlanta.

U.S. automakers say they are urgently trying to overhaul their businesses to meet a global demand for fuel efficient products, like better performing gasoline engines, electric cars and more hybrids.

But industry executives say they may never get there unless the bailout is approved. They add that the shock of any collapse will shake the economy.

If the auto industry comes under severe pressure, GM Chief Executive Rick Wagoner said in a television interview on Sunday, "the impact on the whole U.S. economy will be devastating."

All three companies have rejected reorganizing under bankruptcy protection.

For the Senate measure to pass, it must gain support from both Democrats and Republicans in the narrowly divided chamber where 60 votes are needed to overcome any procedural hurdles.

Aides and lawmakers have expressed doubt about the Democratic effort with so little time and White House opposition.

Nevertheless, two prominent Republicans senators signaled they would be willing to consider a plan. Pennsylvania's Arlen Specter said he was open to supporting the automakers under certain conditions, and Christopher Bond of Missouri, expressed a similar sentiment and said action was needed now.

"I'm pleased to see there seems to be broad support for assisting the auto industry despite disagreements," Bond said.

Bush, whose limousine is made by GM, opposes a bailout using Treasury rescue funds that the administration argues are, by law, intended only for distressed financial services companies.

President-elect Barack Obama, who will be sworn in January 20, has encouraged an aid package, but not a blank check. Obama has said conditions should also include labor, suppliers and lenders so that "we are creating a bridge loan to somewhere, as opposed to a bridge loan to nowhere."

Shares of GM closed up 5.7 percent to $3.18 on the New York Stock Exchange, while Ford slipped 4.4 percent to $1.72. Chrysler is privately held by Cerberus Capital Management LP.

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Unlike the mainstream media, we at the "Glenn Beck Radio Program" decided to actually do the research and get to the bottom of CPAC's controversial stage design, which many on the Left have suggested was purposefully shaped like an obscure Nazi symbol. We got our answers straight from the source — and it's not what the media is suggesting.

American Conservative Union chairman Matt Schlapp joined Glenn on Wednesday to share the real story of the stage design, who designed it, and why he's taking legal options against those smearing the Conservative Political Action Conference's name seriously.

Matt told Glenn he'd never heard of the alleged Nazi insignia, noting that even a staff member who "studied anti-Semitism in college" did not recognize the obscure symbol. He went on to explain how the stage designing firm, Design Foundry, and Hyatt Hotels worked collaboratively with CPAC event organizers for months throughout the designing and construction of the stage. However, when pressured by the cancel culture mob on social media, both companies "ran for the tall grass."

"Both the Hyatt and [Design Foundry] looked to CPAC and said [they] had nothing to do with this stage. That's outrageous," Matt stated. "This whole process takes months ... everybody saw this. Everybody had to figure out how to construct this. Everybody had eyes on it from every angle. And nobody in that process ever raised their hand and said, 'Oh, you know, I took a European history class, and I noticed [that the stage design looked like a Nazi symbol.] Nobody."

Matt went on to add that, while CPAC expects attacks from the Left, they also have every intention of standing up for themselves, the conservative community, the Jewish community, and all the people who love America.

"We're fine with taking the hits. We always take the hits, it's part of being a prominent conservative group. We'll take the hits, but we won't let people lie," Matt said.

"I can't tell you how many people have called me during the course of this most tumultuous of years and said, at what point does the conservative community, do the 74 million Americans who voted for Donald Trump, do the people who love America, and think it's okay to read Dr. Seuss, and love Thomas Jefferson and Mount Rushmore, at what point do they start pushing back on the cancel culture? At what point do they say, this is a line you can't cross? I think we're at that line," he added.

"We called our conference, 'America Uncanceled.' The whole thing became about them canceling us. At what point do we not have the right to say,' you can't treat us this way'? You're disparaging us. You're destroying our reputation. You're destroying our ability to be respected members of our community. So, I'm taking your challenge of pursuing our legal options very seriously. And I think we have to go broader. We can't let these companies just follow the woke mob. We can't do it."

Watch the video clip below to catch more of the conversation:

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CNN reporter Jim Acosta was confronted at CPAC by The Federalist reporter David Marcus with a valid question: "When are you guys going to start covering Cuomo?" His answer — or, really, lack of an answer — perfectly demonstrates why he was earlier surrounded by CPAC attendees chanting, "CNN sucks!"

On the "Glenn Beck Radio Program" Tuesday, Glenn and producer Stu Burguiere react to a video clip of the exchange with Acosta, as well as the mainstream media's double standards when it comes to Democratic New York Gov. Andrew Cuomo.

Watch the video below:

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Glenn Beck can't help but wonder, "What is wrong with us?" in light of the Left's latest move — canceling six Dr. Seuss books due to "hurtful and wrong" illustrations — that takes America one step closer to complete insanity. And now, school districts are jumping on board after President Joe Biden seems to have dropped Dr. Seuss from the White House's annual "Read Across America Day" proclamation.

On the radio program Tuesday, Glenn argued that deleting books is the perfect example of fascism, and asked when we as a country will finally realize it.

"They are banning Dr. Seuss books. How much more do you need to see before all of America wakes up? ... This is fascism!" Glenn said. "We don't destroy books. What is wrong with us, America?"

Watch the video below to hear more from Glenn:


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Former Democratic presidential candidate and Hawaii representative Tulsi Gabbard and Glenn Beck don't agree much on policy, but they're in lockstep on principles.

On "The Glenn Beck Podcast" this week, Tulsi spoke with Glenn about one of her last acts in Congress, introducing the "Protect Women's Sports Act," which she says would "strengthen, clarify, and uphold the intent of Title IX to provide a level playing field for girls and women in sports." But since then, the Biden administration has gone in the opposite direction, and has supported allowing biological men to compete in women's sports.

Watch the video clip below to hear why Tulsi took a stand for female athletes:


Watch the full interview with Tulsi Gabbard here.

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