Despite major Republican opposition, the $14 billion bill to provide aid to the U.S. automakers passed yesterday in the House of Representatives. That figure is a billion dollars less than the figure discussed earlier in the week. With vast Democratic support it passed by a count of 237 to 170.
The bill has changed slightly since last reported. If passed, there will be strict oversight of the companies, and no further dividends would be paid while the loans are outstanding. There would be limits on executive pay and although most of the automakers have already emptied their corporate hangar, there would be no more corporate aircraft.
To oversee the automakers' operations, the president appointed "car czar" would be monitoring the cost-cutting progress. If the companies' efforts are found not satisfactory, the loans can be withdrawn within 30 days.
The measure is primarily a stopgap to keep the companies afloat until the new Congress and incoming administration of President-elect Barack Obama can reevaluate the situation. In the meantime, the companies will have time to work with creditors and UAW for additional concessions.
There is more trouble ahead with the now impending Senate vote. Many Republican Senators have vowed to not allow the bill to pass. We will now have to wait and see if the bill can receive enough Republican votes to cross the threshold into passing. A resolution is unlikely to happen within the week.