WASHINGTON — The battle for the future of U.S. automakers arrives in Congress at noon Monday, when the Senate is to take up a rescue plan whose prospects and particulars remained clouded Friday.
While key Democrats vowed to push ahead, Senate Republicans questioned the use of taxpayer money to bail out Detroit, while the White House hardened its opposition to saving automakers with money from the $700-billion financial industry bailout.
Much of the bill was still in flux, including the amount. The automakers have said they need $25-billion to survive a crippling economic downturn. A smaller package will likely be designed to get them through to early next year, when an Obama administration and the new Congress would tackle a long-term fix.
President Bush said Congress should help automakers by passing legislation to let automakers quickly tap a $25-billion pool of low-interest loans intended to help them retool factories to meet new fuel-economy standards. Those loans, approved in 2007, were to be doled out over the next few years.
General Motors, Ford and Chrysler are seeking an emergency infusion of cash. GM is spending down its operating cash at a rate of $3.1-million an hour and has warned it might not survive through year's end without a government lifeline.
Defying Bush, Senate Majority Leader Harry Reid, D-Nev., said he would hold a vote next week on a bailout. The vote could occur as early as Wednesday.
Bailout watchdog: President Bush nominated Assistant U.S. Attorney Neil Barofsky to become the Treasury Department's special inspector general in charge of auditing and investigating how the federal government spends bailout money. The pick requires Senate confirmation. Barofsky, 38, most recently led the prosecution of top executives at Refco Inc., one of the world's largest commodities brokerages, which collapsed in an accounting scandal in 2005.
Foreclosure help: Publicly breaking with the Bush administration's official stance, the Federal Deposit Insurance Corp. proposed Friday to use $24-billion in government funding to help 1.5-million American households avoid foreclosure. But testifying on Capitol Hill, Neel Kashkari, the Treasury Department's assistant secretary for financial stability, opposed the idea and said it went beyond the intentions of the $700-billion rescue plan.
Freddie Mac: After posting a massive $25.3-billion quarterly loss Friday, the struggling mortgage giant is asking for an initial injection of $13.8-billion from the $200-billion promised by the Treasury Department to keep it and sibling company Fannie Mae afloat after the two were seized by federal regulators in September. Freddie Mac said it expects to receive the money by Nov. 29.
Banks' requests: At least 110 banks have requested more than $170-billion from the Treasury Department's rescue fund, and many more were expected to have submitted applications before Friday's deadline. The requests would come from the $250-billion the Treasury set aside from the $700-billion fund to purchase stock in banks.