This is a rush transcript from "FOX News Sunday With Chris Wallace," December 14, 2008. This copy may not be in its final form and may be updated.
CHRIS WALLACE, HOST: The Senate says "no" to an auto industry bailout. Now, will the president save the big three?
We'll talk with two Senators leading the debate, Republican Bob Corker, architect of a tough love proposal to help the carmakers, and Democrat Debbie Stabenow of Michigan, a strong advocate for the auto industry.
This weekend, the Bush administration is working on a taxpayer bailout to prevent the collapse of America's troubled automakers. The White House abruptly changed its policy on helping Detroit after the Senate voted down a rescue plan.
Well, joining us now to discuss what happens next are two key Senators, Republican Bob Corker of Tennessee and Democrat Debbie Stabenow of Michigan, who joins us from her home state.
Senator Corker, when I came in to greet you in the green room a moment ago, you were on the phone with the White House.
Where does the bailout of the big three stand right now?
SEN. BOB CORKER, R-TENN.: Well, it's my understanding that Treasury officials are actually going through the balance sheets of the companies, talking with them about where they are.
Each of the companies has a very different situation, although both Chrysler and GM are on the verge of bankruptcy, I think just a few days away.
So they're assessing their options. Obviously, the reason I was talking to them is to advocate some options to them.
WALLACE: What do you want to see?
CORKER: Well, look, I — we have a problem and that is we have a group of people who think that the companies ought to go bankrupt and go through Chapter 11 and then we have a group of people who just want to put money on top of a capital structure that will not work.
General Motors has $62 billion in debt and, even in healthy times, cannot pay that back. And then every car they make, they're at a competitive disadvantage because they are disadvantaged by their labor costs.
So we put forth a plan that actually has shared sacrifice, that causes the debt-holders to reduce their debt by two-thirds so the companies are actually viable to do some things on something called VEBA, which actually causes the union to get the things that they have bargained for, but on the other hand, causes them to become competitive with Nissan, Honda, Toyota and BMW sometime in the year '09, as certified by the secretary of labor.
WALLACE: But, Senator — and I'm going to bring in Senator Stabenow in a moment — this is what the negotiations in the Senate broke down over.
WALLACE: You were asking the UAW for concessions. They weren't willing to give them. The bill failed and then the White House...
CORKER: No, no, no, no.
WALLACE: Well, let me just — the White House right away said, "We're going to bail them out."
Why shouldn't the UAW believe, well, if the White House gets too tough with us, they'll eventually blink and they won't force any concessions on us.
CORKER: Well, that is what happened, but the bill that failed was a White House bill, not my proposal. And had the UAW just agreed to be competitive by the year 2009, as certified by an Obama secretary of labor, this bill would've passed with 90 votes.
WALLACE: I understand that.
CORKER: And the reason that it didn't pass was the — and Gettelfinger told me this — he knew the White House...
WALLACE: The head of the UAW.
CORKER: He knew the White House would bail them out. So at the end of the day, they knew the TARP funds were available and, unfortunately, it kept us from doing something that I think would cause the auto industry, GM, Chrysler...
WALLACE: But if I may, just briefly. The direct question is doesn't that same dynamic exist now. If the White House were to insist on all of these concessions, Gettelfinger is going say, "You know what? They're not going to let us go down. I'll resist the concessions and the White House will blink."
CORKER: Well, of course, I think we should deal with it legislatively. OK. But if that's not going to occur, look, I'm here, I can be down to the Capitol in about an hour. I think Chris Dodd can be down from Connecticut.
I think we could solve this appropriately legislatively. But if the government, if the administration is going to use TARP funds, they can write in these same exact conditions.
The big conditions of bondholders taking huge cram-downs could be written in to what they do with TARP. So they could do exactly the same thing and, of course, the benefit they have, they don't have to negotiate. They can say, "This money is available, but it's only available under these conditions."
WALLACE: Senator Stabenow, you favor a bailout. How tough should the administration get in demanding concessions for the $14 billion or however many billion it ends up being from the auto companies, from the auto workers and from the bondholders?
SEN. DEBBIE STABENOW, D-MICH.: Well, Chris, first of all, let me say we're in a global credit crisis. Every other country in the world that has an automaker presence is stepping up to help them get through that because they know it's critical to their economy, it's critical to jobs, and it's critical to their national defense.
So, so far, we're the only ones in America that have not understood that and stepped up.
I welcome the White House doing that. What Senator Corker is talking about, though, is a structure, first of all, a loan. We had in front of us a $14 billion loan, bridge loan, that would allow them to get through the end of March and to do all the restructuring that he is talking about, bringing administration, the workers, the bondholders, everybody to the table equally to get involved in making the kinds of cutbacks and concessions...
WALLACE: But, Senator Stabenow, you have...
STABENOW: ... if I may...
WALLACE: ... you have — if I may. You have the leverage now. So why not, before they get the $14 billion, say to everybody, up front, agree, not in March, but now, before you get the money, agree to these concessions?
STABENOW: As far as I'm concerned, as long as everyone is at the table equally, that's fine. The Senate Republicans wanted to negotiate once with workers, who've already been the only ones that have taken cuts, once with workers, first, and then bring everyone together.
And I think it's very important for us to talk about reality, as well. If we talk about hourly wage rate in America, the fact is that GM workers make $0.22 an hour less than Toyota. Chrysler makes exactly the same and Ford makes $1 less.
The reality is that it's health care and pension costs. We're the only ones that don't have national health care and pension policies of all the countries that we are competing with.
So if, in fact, we're talking about — if Senator Corker is saying people shouldn't get their pension or shouldn't get their health care, and I'm sure he's not, but if he is, I mean, that's really what we're talking about.
WALLACE: All right. Let me — let me...
STABENOW: The structure we need is health care reform. If we want to get to the costs that Senator Corker is talking about, then we need to join with our president-elect and have real health care reform.
WALLACE: Let's — and I know that you're upset with some of the things or take issues with some of the things that Senator Stabenow said, Senator Corker.
The president of the UAW, Ron Gettelfinger, held a news conference Friday, in which he said or suggested that you and other Republicans in the Senate, during his negotiations, tried to set him and the union up. Let's watch.
(BEGIN VIDEO CLIP)
RON GETTELFINGER, UAW PRESIDENT: The GOP caucus was insisting that the restructuring had to be done on the backs of workers and retirees rather than having all stakeholders come to the table.
They thought perhaps they could have a twofer here, maybe. You know, pierce the heart of organized labor while representing the foreign brands.
(END VIDEO CLIP)
WALLACE: Senator Corker, I don't want to get into the details of hourly rate, wage rates and things like that, but I want to get to the more general question.
In your effort to negotiate a deal, were you trying to do it all on the back of the unions or were you saying everybody had to get what's being called now a haircut?
CORKER: Everybody. First of all, I have a General Motors plant in my state. It's very important to the state.
I have been a card-carrying union member myself. We began a process by first getting the bondholders to take $0.30 on the dollar, a $0.70 haircut. That had to happen first by March 15 and if it didn't...
WALLACE: And they agreed to that.
CORKER: They have agreed — they got — yes. They have agreed that if they don't get there, the company has to file bankruptcy.
So General Motors was at the table, Chrysler was at the table, Ford was at the table. They were in the ante room. They agreed to that.
Secondly, we agreed to the fact that the VEBA payments was, without getting into a lot of details, $21 billion that General Motors has. Half of it would be paid in stock, half of it in cash.
So that's off to the side. We had everything worked out except for one thing and that is that the UAW had to be competitive. Now, that's a loose term. And if Deb Stabenow is right that the UAW actually gets paid less than Nissan and Toyota and Honda, then it seems to me it's a no-brainer.
Gettelfinger, I called him the next day and said, "Look, please, I'm pleading with you. This is not something that's that difficult. I'm pleading with you to let the"...
WALLACE: And he said?
CORKER: And he said, "We know the administration is going to come forth with TARP moneys and I am not going to agree to do this with you."
WALLACE: Senator Stabenow, do you think there was an effort by either Senator Corker or other Republicans, as Ron Gettelfinger suggests, to break the union?
STABENOW: Well, Chris, let me say this. Bob Corker and I have talked throughout this last week. I believe he is sincere and came to the negotiating table in a sincere way.
I also believe, and it was very clear, that his leadership did not want an agreement. While Senator Corker was in the room and while they were negotiating and actually coming to an agreement, leadership staff, Republican staff were already circulating a story that the unions had killed the deal.
They did not want an agreement. And here's my biggest concern. That is a political agenda of the leadership at a time when the economy is teetering on the edge and we have potentially three million people that will go over into the unemployment rolls, taking us off the cliff, and we have the largest manufacturers in the country, which is the backbone of the middle class of this country.
That is not a slogan. The reality is we built the middle class because we could build things and the fact is that manufacturing is on the edge in this country.
This is not the time for a political agenda. Yes, bring everyone to the table. The bill we had in front of us was tough. I believe if Senator Corker and I and others by ourselves, without the Senate leadership looking over his shoulder, were able to come together, we could get an agreement.
But it's got to be fair for everybody and the biggest thing is we have to understand that we have an economy on the edge and people cannot play games with this.
WALLACE: All right. We've got less than two minutes left and I want to get through a couple of more issues.
Senator Stabenow, assuming that the big three get enough money from the Bush administration to tide them over until March, is that it? Are you promising that the big three will never have to come back to Washington and ask for more taxpayer money?
STABENOW: Well, I think, unfortunately, we're still in a situation where the long-term restructuring has to be done. There has to be a manufacturing strategy for the future.
I'm confident our incoming president understands that and is committed to that. But we're in a situation where a short-term bridge loan makes sense and then it's not about just continuing to give additional loans.
It's about giving them time to be able to restructure, everyone, workers, the CEOs, the suppliers, the bondholders, everybody, so that they have a long-term, viable industry.
WALLACE: Senator Corker, how long do you expect this to go on and how much is this going to end up costing the taxpayer?
CORKER: Look, we have a historic opportunity. The company, GM, has told me if I could've — if we would've been successful this week, they would not have asked for any money.
If we do this under the terms that Deb Stabenow is asking, this is the beginning of probably hundreds of billions of dollars, because we're piling on taxpayer money on top of $62 billion liability that they cannot pay back.
Let me just say this. I have never been prouder of my conference. Mitch McConnell, we, in the room, were all trying to figure out some way of getting the UAW to just agree to a finite date.
I think the Bush administration has a historic opportunity over the next few days, if it's not coming back to Congress with TARP, and, unfortunately, I think the president has to decide — is he still running the White House or is the UAW? And that's a pretty tough thing, but...
STABENOW: And let me just jump in...
CORKER: ... I have to tell you, this is a time for the shared sacrifice to happen.
STABENOW: With all due respect...
WALLACE: Senator Stabenow, you get 30 seconds and you have the last word.
STABENOW: Bob, with all due respect, the only people that have already sacrificed, and I can tell you that directly from men and women in my state, have been the workers.
The reality is this is not about workers in America. It's not about workers in America being paid too much. It's not about the middle class being paid too much.
It's about a long-term commitment to advance manufacturing and that's what we're talking about.
WALLACE: All right. We're going to have to leave it there. Senator Stabenow, Senator Corker, thank you both. Thanks for coming in. We'll see what happens this week.
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