We've summarized the Corker proposal for you in the prior post, and to be comprehensive (and because we're taking tomorrow off), it's worth reflecting on the other Republican ideas re: the auto bailout. The Ensign-Shelby approach works through bankruptcy, as Ensign's summary explains:
The Big 3 automakers need to restructure their firms in order to be viable and competitive companies in the future. Chapter 11 is the best way to ensure the automakers emerge in the future as successful companies. Bankruptcy court judges have the power to require concessions from management, labor, and the companies’ creditors. An auto czar would only be able to facilitate voluntary negotiations. Chapter 11 also helps protect the companies and their employees from the politicized process to which an auto czar would be constantly subjected.
This amendment would immediately provide debtor-in-possession financing to any of the Big 3 car companies should any of them file for Chapter 11 bankruptcy within the next 12 months. It would also guarantee the warranties of any new vehicles offered by a carmaker in Chapter 11 with the full faith and credit of the United States.
Which will fare better, if there is more faring to be done? A DC source says:
I hear that the Corker amendment is picking up some support, even among Democrats, but I can't imagine the House would go for it...it really does force the labor issue, but it is hard to tell whether it could practically work--that is, would the unions and the creditors take the deal or not? And what about the dealerships problem? Plus, the bankruptcy provision for non-compliance is problematic, in that, at that point, the automakers might need to go into Chapter 7, which the bill would seem to disallow. This would make that provision, as Mickey Kaus puts it, "too big a stick"--one that would never be wielded.
Corker's plan does have a dealership problem, which must be absolutely crippling for the not-so-big three.
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