A GOP Senate aide tells NRO that Republican senator Bob Corker is in negotiations with Senate Banking Committee chairman Chris Dodd and representatives of the UAW — which means the auto bailout is far from dead.
Dems are trying to strike a deal with Corker, because key Republicans have signaled that they might support the bailout bill if it includes some of Corker’s proposals. Corker has put forward an amendment that would give a federal “car czar” the power to force the Detroit three into bankruptcy if they didn’t comply with certain restructuring goals, which would include tough concessions from the unions. Senate GOP leader Mitch McConnell praised Corker’s amendment in his speech today.
The danger here for conservatives is that Corker comes out of negotiations with a watered-down version of his original proposal, but one that still sounds tough enough to garner significant Republican support. If that happens, there’s a chance that Harry Reid can get the 60 votes he needs to bail out the Detroit three.
Even if Corker comes out of negotiations with something very close to his original amendment, that still represents a step in the wrong direction. Now is a great time for inaction — the GOP has enough votes to block the bailout, which is what it should do.
What Corker’s amendment would do is endow the “car czar” with powers that are closer to those a bankruptcy judge would have. But that raises the question: Why not just let a bankruptcy judge sort out this mess? Or, if we must force the taxpayers to finance a restructuring of the Detroit three, why don’t we offer to secure the debtor-in-possession financing they would need to continue operating in Chapter 11? The beauty of bankrutpcy is that we have a bankruptcy judge making the tough calls, as opposed to some federal bureaucrat who has every incentive to spend all the taxpayer money he can to make sure that the blame for whatever happens when the Detroit three collapse doesn’t land on his head?
The Detroit three have frightened us all into thinking that their demise would be the end of the world. It wouldn’t. My advice to GOP senators would be to calm down, hold firm, and keep making the case for bankruptcy (with a government safety net, if need be).