Saturday, December 13, 2008

Republicans May Have Lost On Auto Bailout

The White House is moving forward with a rescue plan for the automakers. Congressional Republicans are not happy about it. What was first declared a tactical victory for the GOP leadership by the likes of MSNBC's First Read, is now looking like a loss. Because Senate Republicans failed to reach a deal with Democrats and their union allies, it now looks like they will get none of the conditions they were pushing for. In a post from the New Republic, Jonathan Chait notes that the White House is poised to bailout the automakers anyway, suggesting that the "GOP maneuver will have been a total disaster" for the party. If the White House uses the TARP funds its doubtful that the carmakers will be required to accept all of the restructuring conditions the Republicans were pushing for Thursday. This is because if the White House does use TARP funds the Republicans will have lost most of their leverage. Right now they have 49 Senate, in January they will have at most 42 seats, maybe only 41, their ability to block a closure vote. When that happens the Democrats will cut a much better deal for themselves, for the union, and for the auto companies. There will be more protections for the workers and there will be tougher environmental standards. Thus Mitch McConnell who was pretty much being hailed as a genius as a leader of the opposition, will have won nothing.

Republicans had a chance to make this bill as appealing as possible, but they didn't want want to concede anything. They didn't want to concede anything on environmental standards. They didn't want to concede anything on worker rights. They wouldn't negotiate in good faith.

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