If you are looking for near-term clues about how the administration plans to help Detroit in January, keep a close eye on the imminent slate of cabinet position appointments. The choices for the Treasury Department and the Energy Department in particular might hold clues as to previous stances with regard to federal support for the auto industry.
Washington may look to act even before the new president is sworn in. House Speaker Nancy Pelosi (D., Calif.) is said to be drumming up support for an additional $25 billion in low-cost loans for the automakers, though resistance remains high to use those funds to facilitate a proposed merger between GM and Chrysler.
(Reports now say that Pelosi will meet Thursday with the chiefs of GM, Ford and Chrysler to discuss the potential for financial support from the government.)
The Bush administration, for its part, recently confirmed that the $700 billion bailout package can also be used to inject fresh capital into the automaker's lending arms.After reading through the expected troubling earnings reports from GM, Ford and the labor market on Friday, Congress may feel compelled to have an action plan together as soon as later this month.
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