Less than an hour after President Bush told reporters at the White House that the Administration would support use of TARP (Trouble Assets Relief Program) funds to bail out the auto industry, conservatives in and out of Congress rushed to denounce the proposed rescue package.
Many conservatives, in fact, believe that the Administration’s embrace of a taxpayer-funded bailout rather than the privately-funded restructuring measure proposed by House Republicans is the “last straw” in support from the right for the outgoing President.
“The action today is disappointing news for autoworkers and taxpayers, who deserve better,” House Republican Leader John Boehner (Oh.) said, shortly after the President’s announcement. “The no-bailout restructuring plan House Republicans put forth this month, which relied on private funds rather than taxpayer funds, was the responsible way for Washington to respond to the troubles in the American auto industry.”
But it was the President’s announcement of a fresh use of TARP funds that clearly upset Boehner the most. He branded the news “the latest in a growing list of TARP money uses that were not discussed with or envisioned by Congress when the program was authorized.”
Grover Norquist of Americans for Tax Reform was even bolder in his condemnation of the Administration’s blessing of a TARP-funded bailout for “Big Three” automakers.
“Any bailout is a disaster,” Norquist told me, “The problem with this one is that it opens the door for more bailouts of other industries and makes ‘noes’ more difficult. Another troubled industry can simply say ‘You did it for the auto industry, so why not us?’”
Norquist also noted that the caveats the White House insists on in the $13.4 billion in emergency loans to the ailing automakers and the other $4 billion that they will get in February can be changed by the incoming President.
“Barack Obama can request legislation to change the caveats [conditions for reorganizations and reforms in their way of business in return for the bailout] or simply change them by executive order,” he observed, “and when Republicans criticize him, he can just say, ‘I’m continuing the Bush legacy.’ And no one will ever really make the distinction between what Bush called for and what Obama is doing except the former President in his never-read autobiography.”
Norquist said it would be disastrous for Republicans to even “put fingerprints on another bailout.”
For conservative Republicans in Congress, Norquist warned, “the question is do you still salute the President who is leaving in a month when he says you have to do something?” He also expressed his belief that “John McCain, who made a career out of saying government was spending too much, threw his Presidential bid away when he saluted the outgoing President and endorsed the Wall Street bailout in the fall. That was pretty expensive decision — for the taxpayer and for McCain.”
The bridge loans for GM, Chrysler and Ford will be a lifeline for the “Big Three” until March 31, when the Obama Administration must determine if they are meeting the conditions of the loans and whether to continue government aid.