After listening to a newly contrite appeal for billions in taxpayer help for the struggling auto industry, U.S. Sen. Jon Tester said Thursday that there are merits to throwing a tax-funded lifeline to the Big Three, but "the devil is in the details."
"There are grounds to support a bailout, but there are some deal breakers," Tester said in an interview with the Gazette State Bureau on Thursday afternoon.
He also gave some criteria:
Taxpayers would be first in line when the debt is repaid.
The money would be spent in America, on American manufacturing, rather than expanding American-owned plants in Mexico, for example.
A government board would have oversight of the package and would potentially help craft a bankruptcy package for an automaker, should bankruptcy prove inevitable.
Tester also correctly notes that this bailout is a far better deal for taxpayers than the bailout of Wall Street. It would be stupid of us to stop a smarter bailout because of anger over a stupid one. Ideally, the money for this would come from the already approved $700b anyways.
Final thought: as the newspaper account and the video highlight, Tester is neither bending over backwards to support or to oppose this deal. Rather, he appears to be demanding a good deal and saying he'll support it if it has its ducks in a row. That's a good position -- especially for someone like him who has some real say in how this thing gets crafted (although, even in a club of 100, he lacks the seniority still to be in the driver's seat).
Jon Tester asked and now they've agreed. The CEOs of Ford and GM will cut their pay to just $1 if they receive the bailout they're pining for (Chrysler's CEO had already agreed; also it is unclear if that pledge extends to their salary or to their total compensation package).
That's good news -- and Tester explains that it goes a bit beyond symbolism (which is true, given the size of their salaries).
So good work to our Senator, but this isn't over yet. Before another dime of public money is handed out, Washington better think long and hard. I'm far more sympathetic to Detroit's situation than I am to Wall Street. For all of their dumb management decisions (including to keep health care in-house and oppose universal health care against the UAW's wishes decades ago), Detroit makes stuff of real value and employs middle class workers. Wall Street got rich trading BS at the cost of the country.
Anyways, there is more to ponder on this proposed bailout. Here's some suggested reading for anyone (including our Senator or his staff) who may be interested:
I have to say, I'm torn on this. The bailouts are bothersome. A vibrant economy has a place for failure and bankruptcy. But the auto manufacturing market is far from a competitive market (witness Ford's support for a bailout package it claims it only needs indirectly). How do we get it to the point where it is? I have no idea.
