It looks like the unpopular auto company bail out is going to have a tough time passing in the current Congress.

Republicans were preparing a strong fight against the aid plan in the Senate, not only taking on the Democrats but standing in open revolt against their party's lame-duck president on the measure.

The Republicans want to force the companies into bankruptcy or mandate hefty concessions from autoworkers and creditors as a condition of any federal aid. They also oppose an environmental mandate that House Democrats insisted on including in the measure.

House Speaker Nancy Pelosi said the House-passed bill represented "tough love" for U.S. auto companies and "giving a chance -- this one more chance -- to this great industry."

So tough that it will force the auto companies into a position of building cars they can't sell.

The fuel-efficient "green" cars GM, Ford and Chrysler profess to be thrilled to be developing at Congress's behest will be unsellable unless gas prices are much higher than today's.

"Very few people will want to change what has been their 'nationality-given' right to drive big and bigger if the price of gas is $1.50 or $2.00 or even $2.50," Mr. Lutz explained. "Those prices will put the CAFE-mandated manufacturers at war with their customers -- and no one will win in that battle."

Translation: To become "viable," as Congress chooses crazily to understand the term, the Big Three are setting out to squander billions on products that will have to be dumped on consumers at a loss.

This from the geniuses who brought us Fannie Mae and Freddie Mac.

And it gets better. The government will appoint a commisar of auto production to watch over the companies to make sure the money isn't wasted building cars the consumers want.

Besides providing cash for the auto companies, it would create a government "car czar," to be named by President George W. Bush to dole out the loans, with the power to take back the money and force the carmakers into bankruptcy next spring if they didn't cut quick deals with labor unions, creditors and others to restructure their businesses and become viable.

"To give up on the auto industry now would be to condemn the American economy at one of its most vulnerable periods in our economic history to a degree of further hurt," said Rep. Barney Frank, D-Mass, the Financial Services Committee chairman.

Opposition from Republicans reflected the tricky task of pushing yet another federal rescue through a bailout-weary Congress, with Bush's influence on the wane.

"People realize that this bill is an incredibly weak bill (and) is the product of an administration that wants to kick the can down the road and let somebody else deal with it," said Sen. Bob Corker, R-Tenn.

And it only gets better.

In the Senate, opposition to the auto rescue wasn't limited to Republicans.

Democratic Sen. Max Baucus of Montana announced he was against the measure because of a provision to bail out transit agencies that were involved in transactions that are now considered unlawful tax shelters.

And really. Congress is keeping an eagle eye on the the government purse.

The carmakers initially asked Congress for $25 billion, then returned two weeks later to plead for as much as $34 billion. But with the White House refusing to dole out new spending for the Big Three, congressional Democrats agreed to use an existing program that was to help carmakers retool their factories to make more fuel-efficient cars.

That fund yielded only $15 billion in emergency loans, and when negotiators agreed to leave some money in the environmental program, the amount fell to $14 billion.

Democrats agreed to scrap language -- which the White House had called a deal-breaker -- that would have forced the carmakers to drop lawsuits challenging tough emissions limits in California and other states. But they kept a provision to force the automakers to abide by those states' limits -- a kind of consolation prize for environmentalists, who already were livid at the raid of the fuel-efficiency program.

Senate Democrats unveiled a nearly identical measure that omitted the requirement, but that bill still faced long odds.

At the White House, Deputy Chief of Staff Joel Kaplan said the Bush administration would work with President-elect Barack Obama's team on choosing industry czar.

And what does our Smartest President Elect Ever™ have to say?

"As messy as it may be, I think there's a sense of, 'Let's stabilize the patient,'" he said in an interview published in Wednesday's Chicago Tribune and Los Angeles Times.

The car czar would have say-so over any major business decisions by the automakers while they were taking advantage of federal aid, with veto power over any transaction of $100 million or more. The companies -- including the private equity firm Cerberus, which owns a majority stake in Chrysler -- would have to open their books to the government overseer.

And the final kicker?

Also included in the bill is an unrelated pay raise for federal judges.

H/T Instapundit

Cross Posted at Power and Control

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