Southfield (WWJ/AP) -- President Bush announced Friday that the federal government will provide $17.4 billion in short-term financing to US automakers.
Speaking live on WWJ Newsradio 950 Friday morning, U.S. Senator Debbie Stabenow said she's optimistic about the future, and thinks the industry will be viable in the long term. Stabenaw was part of the team pushing for the loan.
"I'd have to say this is good news for us in Michigan," she said. "For thousands and thousands of families right before Christmas to know that at least we have the support and help with the bridge loan we've been asking for," Stabenow said.
WWJ Auto Analyst John McElroy said now that the car companies are getting the loans, the UAW and others will have to make sacrifices to keep the auto companies competitive.
"Sub-benefits -- that will likely go away. Paid days off.... UAW people typically get 42 paid days off a year. That will probably be cut in half, or something like that," McElroy said. "There's going to be other who are going to have to give, too. Creditors are going to have to accept a lot less of what GM owes them," he said.
A new President next month? No problem, says Michigan Republican Congressman Thaddeus McCotter. As you heard live on WWJ, McCotter, a key proponent of loaning the Big 3 money, says the restructuring effort won't be derailed by a new face in the Oval Office.
"I don't think that, necessarily, a change in administration is going to affect the outcome of this," McCotter said.
"I think what's absolutely going to have to happen is that the participants in the room are going to have to put it on the table, do what is necessary, and put a plan in front of all of the American people that they understand shows a path toward future viability for this industry," he said.
Lansing's Democratic mayor suddenly is a Bush fan as a result of the loan deal. "I spent a career in politics cursing at him, but he's right on with this decision,'' Mayor Virg Bernero said Friday of President Bush.
`"I praise God he's doing the right thing. He's going out on a high note," Bernero said.
President-elect Barack Obama, who takes office a month from Saturday, praised the White House move. "Today's actions are a necessary step to help avoid a collapse in our auto industry that would have devastating consequences for our economy and our workers,'' he said.
`With the short-term assistance provided by this package, the auto companies must bring all their stakeholders together - including labor, dealers, creditors and suppliers - to make the hard choices necessary to achieve long-term viability," Obama said.
More Michigan Reaction
``The City of Detroit is grateful to President Bush for his support and making money immediately available for our automakers now and again next month. ... While the immediate funding is certainly good news and a step in the right direction, it is not nearly enough to jumpstart America's economy. We look forward to continuing our advocacy on behalf of Detroit and the auto industry.''
- Democratic Detroit Mayor Kenneth Cockrel Jr.
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``While I regret that the automobile manufacturers are in their current, troubled state, exacerbated by our current credit crisis, it is clear that the only way they will survive is with the assistance of a federal loan. ... I hope this will help our nation's auto industry survive and eventually prosper.''
- Republican U.S. Rep. Vernon Ehlers of Grand Rapids
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``While I applaud President Bush's decision to provide short term loans to the domestic automakers, I have strong concerns about some of the conditions that were placed on these loans. We all want to see the Big 3 restructure and be competitive in the future, but it is irresponsible during a time of economic crisis for the White House to insist that workers take further wage cuts on top of the historic concessions they have already made.''
- Democratic U.S. Rep. John Dingell of Dearborn
Big three react.
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