The House passed the bailout bill last night 237-170. 32 Republicans voted in favor of the bailout. Can the Senate kill it? Tennessee Senator Bob Corker has proposed an amendment to the bill that adds specific conditions, requiring specific concessions from automakers, bondholders and the union.
Senate Majority Leader Mitch McConnell, who supports the Corker amendment:
“Senator Corker has proposed an amendment that would go a long way toward improving this bill. In keeping with the principles I’ve outlined, the Corker Amendment does not just encourage reform, it requires it. And it does so with crucial specificity...
...First, participating companies would be required to reduce their outstanding debt by at least two-thirds through an equity swap with bondholders.
“The Corker Amendment also requires that labor costs at participating companies be brought on par with companies like Nissan, Toyota, and Honda — not tomorrow but immediately — because it is delusional to think that a company which spends $71 per labor hour could compete with a company in the same industry that spends $49.
“The Corker Amendment would improve the liquidity and cash-flow of automakers by requiring that a portion of the payments made to union accounts consist of company stock.
“And finally, the Corker Amendment would require participating companies to file for Chapter 11 reorganization if any of these conditions aren’t met by a fixed date.
The text of the Corker amendment is here. The amendment certainly improves the bill. Maybe it will force automakers to take a second look at bankruptcy.