Senate: Final hurdle to bailout deal
The US government deal to bailout its car industry was voted through by the House of Representatives last night, but it still needs to overcome heavy opposition from the Republican party at the next stage.
The Senate get to vote on the rescue package next, and Senate rules mean a sceptical Republican minority has every chance of blocking or killing the $14bn package agreed yesterday.
Reports from the US say Republican anger is growing – in spite of Presidential support – based on fears that the vast injection of taxpayer dollars will not resolve the underlying issues confronting the domestic industry.
The Republican view was expressed by Senator Richard Shelby in pretty bald terms: ‘This is an instalment on a huge bailout that will come later. This will not make Chrysler, General Motors or Ford competitive. This in only delaying their funeral.”
News of the Republican opposition caused US automotive share prices weaken even further, as GM and Chrysler need billions injected before the end of this month in order to survive.
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