Wednesday, September 24, 2008

House Passes $25B in Loans for Automakers

This means jobs. New jobs, retained jobs. Jobs for Michigan. So, yay!

Late this afternoon, the U.S. House overwhelming passed a budget bill that approves up to $25 billion in low-interest loans for the auto industry by a 370-58 vote. The Senate is set to follow suit on Friday, and the White House is expected to sign the bill that funds through March 6 the continuing operation of government.

Automakers scored a big victory, when congressional leaders agreed to help speed up the timetable for the low-interest government loans to help the auto industry retool to build advanced more fuel-efficient vehicles. In language inserted late Tuesday night, the U.S. Energy Department must issue its final rules for the loan program within 60 days of becoming law.

The program was authorized by the energy bill approved in December, but not funded. Because Detroit's Big Three automakers have sub-investment grade credit, they face 20 percent interest rates to borrow money without these loans. Automakers will be able to save more than $100 million in borrwing costs per $1 billion borrowed.

Dingell and Stabenow will try for $25B more next year.