Auto bailout stalls: White House gets ‘cold shoulder’ from Senate GOP

By Lisa Mascaro

Thursday, Dec. 11, 2008 | 12:26 p.m.

WASHINGTON — In leading his party’s opposition to the $14 billion automotive bailout, Sen. John Ensign was surprised to see his Republican colleagues give White House officials the “cold shoulder” during their internal discussion on the rescue plan.

Ensign moderated the Republican senators’ weekly policy lunch attended by Vice President Dick Cheney and Chief of Staff Josh Bolten yesterday — a job he will likely be doing more often in his new position as policy chairman.

As Ensign facilitated questions between senators and administration officials, he was surprised by “the cold shoulder, the lack of support among his colleagues” for the bill, his spokesman said.

Bush administration officials “were in there to make their point on this Democrat-White House bailout…. a significant amount weren’t picking up on this pitch,” Ensign’s spokesman said.

Ensign has been an early and leading critic of the Big Three bailout, as I wrote in today’s Sun.

But one of Ensign's main claims — that union workers at GM, Ford and Chrysler are making $70 an hour compared to $30 for their nonunion counterparts at U.S. manufacturing plants run by foreign competitors — may not be the full story.

The New York Times fact checked the $70 hourly wage claim today, reporting that much of the difference between the hourly costs of union and nonunion workers goes toward benefits for retired Big Three workers – those who helped build the middle class with union manufacturing jobs.

Minus the retirees’ benefits, the difference between the compensation package for today’s union and nonunion autoworkers is about $10 --- $55 versus $45.

The real problem, the Times says, is not the labor costs at the Big Three – their vehicles are still cheaper than those made by the foreign competitors. It’s that “many people don’t want to buy the cars that Detroit makes.”

Here’s the Times’ David Leonhardt:

“The Big Three built up a huge pool of retirees long before Honda and Toyota opened plants in this country. ..

“These retirees make up arguably Detroit’s best case for a bailout. The Big Three and the U.A.W. had the bad luck of helping to create the middle class in a country where individual companies — as opposed to all of society — must shoulder much of the burden of paying for retirement.”

The folks at the conservative Heritage Foundation, who advise many congressional Republicans, will surely dispute these findings.

Meanwhile, the auto bailout plan is stalled here on the Hill today despite its passage by the House last night.

Ensign’s opposition is becoming the mainstream party position — the Republican leader, Sen. Mitch McConnell of Kentucky, now says he too opposes the proposal as he is unconvinced it will create viable companies.

“Another month, another bailout,” said Republican Rep. Dean Heller of Carson City, who voted against the bill in the House, in a statement. “Congress should focus on real economic reforms that generate jobs instead of continuing to bailout individual industries with taxpayer dollars,” Heller said.

But Democratic Rep. Shelley Berkley urged passage, saying Congress will “hold Detroit’s feet to the fire” to ensure the money is repaid.

“This was not a perfect package, but at the end of the day, I could not stand by and allow GM, Ford or Chrysler to go bankrupt or to close their factory doors forever,” Berkley said in a statement. “Our nation is still facing financial turmoil. Add to that the loss of the Big Three and the jobs that come along with the automobile industry — including those in Nevada — and it becomes clear why we must act to pass this loan package.”

As time ticks away, Ensign and his colleagues continue this afternoon drafting an alternative.