White House says passage of auto bill ‘realistic’

President Bush and members of his administration are
lobbying GOP senators to support a short-term auto bailout measure, and passage
of that bill is “realistic,” the White House said Thursday.

While spokeswoman Dana Perino declined to tell reporters
which senators Bush is targeting, she said he is making the case that
legislation to be taken up in the Senate “is the most effective and reasonable
approach” to helping the ailing domestic auto industry.

{mosads}Perino said there “is a chance” that the measure will
pass. However, many Senate Republicans have expressed strong concerns about the
bill, and GOP leader Mitch McConnell (Ky.) earlier in the day said he opposes
the legislation.

“There are going to be members of Congress who disagree
with us even at the end of the day, no matter how forceful and persuasive our
arguments are,” Perino said.

In light of new unemployment claims reaching a 26-year
high last week, she added that the auto industry must be saved.

“We believe that the economy is in such a weakened state
right now that adding another possible loss of 1 million jobs is just something
our economy cannot sustain at the moment,” Perino said, adding: “We have to do
things at the federal government level that we wouldn’t normally want to do.”

McConnell argued on the Senate floor that the $14 billion
package, which the House passed Wednesday evening, would not ensure the
long-term viability of the Big Three automakers: General Motors, Ford and
Chrysler.

“Its greatest single flaw is that it promises taxpayer
money today for reforms that may or may not come tomorrow,” McConnell said. “We
would not be serving the American taxpayer well if we spent their hard-earned
money without knowing with certainty their investment would result in stronger,
leaner automobile companies that would not need additional taxpayer help just a
few months or weeks down the road.”

McConnell said the Democratic-crafted package would be
improved significantly if the Senate adopted an amendment sponsored by Sen. Bob
Corker (R-Tenn.).

The Republican leader made his remarks shortly after
President-elect Obama said he hopes Congress will pass the short-term measure
aimed at helping the ailing domestic auto industry.

“We cannot simply stand by and watch this industry
collapse,” Obama said at a news conference. If the automakers were to fail, it
would have devastating effects on the economy, he added.

Obama said he understands “people’s anger and
frustration” with the industry, adding that he unsuccessfully had urged Detroit
to change the way it does business.

However, despite people’s views on the Big Three, Obama
stressed that Congress should pass the short-term fix that would buy the
automakers some time to right their businesses and keep workers on the job.

But GOP senators are more likely to get behind Corker’s
proposal, which would require automakers who accepted federal aid to reduce
two-thirds of their outstanding debt through an equity swap with bondholders.

The amendment would also require that labor costs at
participating companies be brought on par with foreign competitors such as
Nissan, Toyota and Honda, and that a portion of payments automakers make to labor
unions consist of company stock.

Corker’s proposal would require companies to file for
Chapter 11 bankruptcy if its conditions were not met by a fixed date.

“We simply cannot ask the American taxpayer to subsidize
failure,” said McConnell.

The package passed the House 237-170 with the support of
only 32 Republicans.

McConnell’s opposition sets back proponents of the
package who hoped that the support of President Bush and Republican leaders
would help convince wavering Republican senators to sign on.

An auto industry source told The Hill that Democrats
would need between 14 and 16 Senate Republicans to pass the package. Lobbyists
were counting on the support of GOP leaders to persuade lawmakers such as Utah
Sens. Orrin Hatch (R) and Bob Bennett (R).