Automakers Wait For President Bush To Jump In
STEVE INSKEEP, host:
It's Morning Edition from NPR News. Good Morning. I'm Steve Inskeep. We're still looking for clues to the future of the auto industry. We know two big automakers say they are close to bankruptcy. We know that many auto plants will take unusually long Christmas break. We do not know how President Bush will back up his determination to support the automakers; at least that was how we interpreted his determination a week ago. Yesterday, the White House spokeswoman Dana Perino said automakers might be allowed to go bankrupt, though without a disorderly collapse.
(Soundbite of press conference, December 18, 2008)
Ms. DANA PERINO (White House Press Secretary, George W. Bush Administration): By that I mean a disorderly collapse would be something very chaotic, that is a shock to the system. If there's - there's an orderly way to do bankruptcies that provides for more of a soft landing. I think that's what we would be talking about.
INSKEEP: One man well-placed to cover this story is NPR's Don Gonyea. He covered the auto industry in Michigan for years before becoming our White House correspondent, and he's on the line live. Don, good morning.
DON GONYEA: Good morning.
INSKEEP: Is the White House changing what it's willing to do?
GONYEA: We have never known specifically what they would be willing to do. The auto companies, though, and the UAW do not find what they heard yesterday reassuring. I can tell you GM stocks fell yesterday after Dana Perino's press briefing. There's been no official comment from the companies. Again, we're talking about GM and Chrysler here; Ford is not in the mix. But they don't really make the distinction - they haven't publicly so far - between an orderly or a disorderly bankruptcy. The word bankruptcy they feel like would be poison. It would cause customers to lose confidence in them and literally scare them away from their showrooms. So, they're very concerned about this.
INSKEEP: But we heard the White House spokeswoman mention bankruptcy, and Treasury Secretary Henry Paulson is also using that word. Let's listen to Paulson from his speech last night in New York.
(Soundbite of speech, December 18, 2008)
Secretary HENRY PAULSON (U.S. Department of the Treasury, George W. Bush Administration): If the right outcome is reorganization or bankruptcy, then isn't it better to get there through an orderly process, where every effort is made to avoid it, and if it can't be avoided, everyone is prepared for it?
INSKEEP: Don Gonyea, help us interpret that, because Paulson mentions bankruptcy, but also mentions making every effort to avoid bankruptcy. So, which way is the administration leaning?
GONYEA: Well, he seems to be tempering Dana Perino's comments, at least a bit. He's changing the emphasis. He's making the possibility of an orderly bankruptcy - and again, they always use those words together - he's making it seem as though it is the absolute last resort, that they are trying to get a deal that would allow them to avoid that. Now, these talks are underway, between the carmakers and the White House and the Treasury. It could also be a way just to ratchet up the pressure, to really drive home the point in a public way, away from the bargaining table, that this is very serious and that the companies and the UAW need to step up and make sure they are giving all they can, that they can be doing all that they can do in order to avoid that step that they really hope to avoid.
INSKEEP: Because the administration may have money to lend here, but they want to put conditions on it, perhaps (unintelligible).
GONYEA: Exactly. And you know, the assumption has been that the administration would impose something very similar to what was in that bill that died in the Senate last week, but that the money would have to come, obviously, from a different place. The money would come from the emergency federal bailout money.
INSKEEP: Don, what does the president himself say?
GONYEA: Well, he did weigh in on this yesterday, as well. He had an appearance at a think tank in town, the American Enterprise Institute in Washington, a think tank that is dedicated to, you know, to free-market systems. And he was asked if maybe the car companies aren't just looking for a better deal from the White House than they could get from Congress. He stressed that he has not yet made up his mind. He said that this is very serious, but then he added this. Give a listen to the president.
(Soundbite of press conference, December 18, 2008)
President GEORGE W. BUSH: I'm also worried about, you know, putting good money after bad; that means whether or not these autos will become viable in the future. And frankly, there's one other consideration, and that is, I feel an obligation to my successor. I've thought about what it would be like for me to become president during this period. I haven't - I believe that good policy is not to dump him a major catastrophe in his first day of office.
GONYEA: So, what he appears to be saying, at least on this issue, this particular crisis, he does seem to be saying he wants to have something done. It could happen today, next week.
INSKEEP: Don, thanks very much.
GONYEA: Thank you.
INSKEEP: That's NPR White House correspondent, Don Gonyea.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.