Big Three execs to meet with Pelosi

The Big Three’s chief executive officers will meet with House Speaker Nancy Pelosi (D-Calif.) on Wednesday afternoon to press for her support for $25 billion in direct loans for the auto industry. 

Congress authorized the loans in last year’s energy bill. They are intended to provide support for the manufacturers to retool plants in order to produce more hybrid cars and other more fuel-efficient vehicles, which the companies will need in order to meet tougher fuel efficiency standards included in the energy bill.

{mosads}But Ford, General Motors and Chrysler cannot access the loans without an appropriation from Congress. The appropriation would cover any possible defaults on the loans by the Big Three.

One possible vehicle for the funding would be the continuing resolution that would allow the government to keep operating. Pelosi has also mentioned a second economic stimulus bill that Democrats are touting as an option.

The auto companies are fighting perceptions that the funding would represent a bailout by arguing that Congress already authorized the loans. They also argue that the funding serves a national interest by helping to wean the U.S. off foreign sources of oil, since less foreign oil would be needed if more Americans could drive more fuel-efficient vehicles.

Pelosi has signaled some support, but has said a figure for the funding must still be determined. The White House has not signed off on the funding, but both presidential candidates have offered support for funding that would likely be popular in several swing states, including Michigan and Ohio.

White House spokesman Tony Fratto on Friday urged caution.

“Obviously, we want to be very, very careful about the government’s role with private enterprise out there,” he said. “There are lots of industries that are dealing with challenging economic conditions, and it’s always important to be very cautious about the federal government’s role.”