General Motors CEO Richard Wagoner said Friday that the Treasury Department's decision to provide auto suppliers with $5 billion in assistance is a "very positive move" ahead of the automakers' submission of final reorganization plans next week.
"I think it's a very positive move," Wagoner told Bloomberg news. "I think from it we draw the conclusion that the task force has obviously one a lot to get themselves up to speed and date on the issues."
GM and Chrysler submitted viability plans asking for billions more in assistance for each company in order to stave off bankruptcy last month. The decision by the Treasury Department yesterday to bail out suppliers could be seen as a positive signal for GM and Chrysler.
Wagoner said that the automakers' believe they have bottomed out in sales amidst a dismal economy, and will be able to return to viability with more sales and lower costs in the future.
"On balance, I think it's fair to say more we're in a situation of the economy and auto sales moving along on what we hope is the bottom," he said. "I think the baseline plan that we submitted on Feb. 17th is the one we're going to continue to work with. I think it's premature right now...to suggest we should be changing our numbers."
Congress was too "emotional" in reacting to the AIG bonus scandal, Rep. Ron Paul (R-Texas) declared Friday, blaming voters in part for egging on lawmakers.
"In Congress, they panic. They react minute to minute, whether it's passing the Patriot Act, or doing all of these things," Paul said during an appearance Friday on CNN. "They react in emotional ways."
Paul, a former 2008 Republican presidential candidate who voted Thursday against the 90 percent tax on AIG executives' bonuses, said voters share some of the blame for allowing lawmakers' behavior.
"There's a lot of blame to go around; even the American people have some blame for allowing their members of Congress to do what they do," the Texas congressman explained.
"Ultimately, Congress should assume responsibility," he said. "If Congress would wake up, we could reign in a lot of this. So to me, it was very annoying to concentrate on doing what we were doing on Thursday, and pretend we're going to improve things."
Another bailout of the banks would not be politically possible, in part due to a perceived damaged leadership of Senate Banking Committee Chairman Chris Dodd (D-Conn.), one of his Senate colleagues said Thursday.
"In other words, if we have the TARP IV, you couldn't get it passed with Chris Dodd's problems as head of the banking committee in the senate and the public outcry on just the bonuses," Sen. Jim Bunning (R-Ky.) said during an appearance on the Fox Business Channel.
During the interview, Bunning, who like Dodd faces a potentially difficult reelection battle, also joined the bandwagon calling for the resignation of Treasury Secretary Tim Geithner.
"I didn't think he was qualified for the job because of his involvement in TARP and a seat at the table," said Bunning. "And then of course, he hasn't done anything to ease the burden."
Bunning joins several House lawmakers and Sen. Johnny Isakson (R-Ga.) in calling for Geithner to step down.
The federal government announced Thursday it would provide $5 billion in assistance to auto suppliers, a potentially positive precursor for automakers that have requested billions more in assistance from the Treasury Department to stay afloat.
The Treasury Department said it would assist parts suppliers so that they could continue operations amid the economic downturn.
Chrysler and General Motors asked the federal government for billions of dollars in additional support in their viability plan filings on Feb. 17. In those filings, GM asked for as much as $30 billion in total taxpayer assistance from the government in those filings, while Chrysler said it needed as much as $5 billion to stave off bankruptcy.
The government is set to receive the final reorganization plans on March 31.
"The Supplier Support Program will help stabilize a critical component of the American auto industry d! uring the difficult period of restructuring the lies ahead," Treasury Secretary Geithner said in a statement. "The program will provide supply companies with much needed access to liquidity to assist them in meeting payrolls and covering their expenses, while giving the domestic auto companies reliable access to the parts they need."
In a release, the Treasury Department said it "continues to review" the restructuring plans submitted by Chrysler and GM.
House Ways and Means Committee Chairman Charlie Rangel (D-N.Y.) faced an awkward exchange Thursday morning when pressed by a CNBC anchor over how Rangel could push a surtax on corporate bonuses while facing an investigation into his own tax payments.
"All due respect Congressman -- when you talk about violating the public trust, you've had some tax issues of your own," CNBC anchor Mark Raines told Rangel during an exchange in which the New York lawmaker was raging against how AIG's bonuses "violate the public trust."
"Well, I wouldn't think you would know what they are since what I did or did not is being investigated by a committee," Rangel shot back. "So what you're doing is reporting on what a reporter says because you have no clue what problems, if any, I have."
Rangel called reports in the New York Times alleging that he had not adequately paid taxes on properties in New York City and the Dominican Republic "irresponsible" and inaccurate. He also reiterated that he would not step down as Ways and Means chairman while under investigation.
"I'm not thinking about stopping my responsibilities as member and Chairman of the Committee because of a reporter's report," he explained. "I am telling you that you have to have some confidence in the Ethics Committee."
"I'm not telling you anything except false accusations have been made by a reporter and picked up by other reporters, and find people like you asking me questions where you don't have anything except the reporter that has said it," he added.
Republican candidate for Congress James Tedisco joined several would-be House Republican colleagues Thursday by calling on Treasury Secretary Tim Geithner to resign.
"I believe that, in the best interests of our country, Secretary Geithner should tender his resignation," Tedisco said in a statement. "We need a Treasury Secretary whose first priority will be protecting and fighting for the economic interests of Main Street, not defending the inexcusable actions of AIG."
Tedisco joins at least two lawmakers, Reps. Connie Mack (R-Fla.) and Darrell Issa (R-Calif.), who have called for Geithner to step aside as Treasury Secretary. Tedisco is locked in a tense special election with Democrat Scott Murphy to fill Sen. Kirsten Gillibrand's (D-N.Y.) former House seat.
"In the interest of bi-partisanship, I am asking Scott Murphy to join me in calling for a new direction in leadership at the Treasury Department," Tedisco added, trying to corner his opponent into doing what no other Democratic lawmaker has done.
"The American people are mad as hell over the way AIG, Wall Street and Washington have broken their promises and betrayed their trust," Tedisco added. "We need to restore that trust by defending taxpayer dollars against the reckless abuse of companies such as AIG."
House Minority Whip Eric Cantor (R-Va.) was coy Thursday about whether or not he would personally vote to support the tax bill before the House today that would recoup bonuses paid by AIG executives by way of large surtaxes.
Pressed by liberal pundit Lawrence O'Donnell during an appearance on MSNBC's "Morning Joe" this morning, Cantor -- the second-ranking Republican in the House -- would not commit to vote one way or another on the bill.
"It is terrible tax policy, but I'm telling you one thing: I'm going to get those bonus payments back in," Cantor said. "I think you're going to find a lot of bipartisan support for the Rangel bill. Do you think this is good tax policy? No."
A number of lawmakers on both sides of the aisle have expressed their outrage toward the millions in bonuses awarded to AIG executives while the company remained on taxpayer support.
"I am for whatever we can do right now to get that money back into the Treasury," Cantor said.
An email seeking clarification on Cantor's position from one of the whip's spokespersons was not immediately returned.
Cantor, in statements since the announcement of the AIG bonuses, has been quick to criticize Democrats for allegedly having opened the door to the AIG bonuses.
Issa's call comes after a House Financial Services Subcommittee meeting today in which lawmakers concentrated almost as much anger toward Geithner as AIG CEO Edward Liddy, who was testifying today.
More than 3/4ths of Americans want the government to try and block or recover the millions in bonuses awarded to AIG, a poll released Wednesday found.
76 percent of Americans told the Gallup Poll that the government should intervene to recoup the controversial bonuses, the subject of much congressional scrutiny today.
17 percent of Americans said the government should not intervene in the situation.
Almost 6 in 10 of those surveyed said they were "outraged" by the bonuses, compared to 26 percent who said they were "bothered," and 11 percent who were "not particularly bothered" by the payouts to executives at the insurance giant.
Reactions were similar among Republicans, Democrats, and Independents -- suggesting that frustration toward AIG is cutting across party lines.
The poll, conducted March 17, has a three percent margin of error.
Treasury Secretary Timothy Geithner should either be fired or resign for his poor oversight of AIG, Rep. Connie Mack (R-Fla.) declared Wednesday.
"Quite simply, the Timothy Geithner experience has been a disaster," Mack said in a statement. "Timothy Geithner should either resign or be fired for the good of the country, and President Obama should nominate a new Treasury Secretary with the experience and leadership skills America deserves.
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