Congressional leaders told Detroit's Big Three automakers Thursday that they have until Dec. 2 to submit a plan to Congress on how they will use billions of taxpayer funds to bring their companies from the brink of destruction.
Senate Majority Leader Harry Reid and House Speaker Nancy Pelosi announced that the House and Senate would hold hearings as necessary the week and move forward with a vote on a loan package the following week if the plan proved logical and able to be done.
Reid said the auto industry executives that testified on Capitol Hill this week did not "convince the Congress or the American people that this bailout will be their last" or stop the bleeding from the troubled industry.
"Until they show us the plan, we cannot show them the money," Pelosi added
Pelosi said that Congress wants to help the automakers because "survival is essential to maintaining our manufacturing and industrial base and that industrial base is essential to our national security."
But she said, "We won't move forward with any of these plans until we see more accountability and the prospect for viability." She repeated the words "accountability" and "viability" at least a half dozen times.
"If they make sense and as they've met the criteria the leader and the speaker have laid out, then we'd like to move forward and be of assistance," said Sen. Chris Dodd, D-Conn., chairman of the Senate Banking, House and Urban Affairs Committee.
Dodd and Rep. Barney Frank, D-Mass., head of the House Financial Services Committee, will manage the negotiation with the heads of General Motors, Chrysler and Ford Motor Co.
The chairman of the Big Three testified on Capitol Hill this week, and Reid said did themselves no favors by responding when asked how they arrived to Washington that they had each flown in on their private jets.
A bipartisan group of lawmakers from car-producing states had said they want to provide the loan from cash that was set aside for a fuel-efficiency loan program already passed by Congress. But it was unclear whether it could draw enough support to pass.
"We believe that if there was a vote today or tomorrow we would get the necessary 60 votes to pass," said Sen. Carl Levin, D-Mich., was joined by Sen. Kit Bond, D-Mo.
Levin said Senate leaders decided to put off any votes so Congress could take a look at the plans while his bill would give the agencies responsible for implementing the loan program would review it.
"This is right now in Congress' lap by the decision of the leaders. It is not how we would have proposed it," he said.
The White House weighed in on the announcements by saying President Bush has always insisted that aid for the auto industry be contingent upon the Big 3 making sure it is viable.
"We are pleased the Democratic leadership now agrees that is necessary," said White House press secretary Dana Perino, adding that the president prefers the Levin-Bond approach.
"The bipartisan Bond-Levin compromise meets that test. Their plan provides assistance from already-appropriated funds and has strong taxpayer protections. While we need to review the language, this is an agreement the president could support. We encourage the Congress to pass it as soon as possible," she said.
Earlier in the day, Reid, D-Nev., canceled plans for a vote on a bill to carve $25 billion in new loans out of the $700 billion Wall Street rescue fund. The Bush administration and congressional Republicans oppose that plan.
Frank said part of the reason that the public and lawmakers did not want to lend the cash relates to the implementation of the $700 billion Wall Street bailout. He said the willy-nilly nature of acceptance by Congress and implementation by the administration led to objections for more huge outlays.
If lawmakers do vote on a plan, it will likely have to include numerous conditions perhaps like a partial ownership of the companies, limitations on salaries of top executives and a ban on the use of the funds for any lobbying.