Americans uneasy over likely bailout for auto giants

Atlanta: As the US Congress debated legislation yesterday to help struggling automakers, many Americans said they were uneasy with the plan, arguing that while it may save jobs, it would reward companies for pursuing bad business practices.

In interviews from New York to Los Angeles, everyday Americans said the proposed $25 billion (Dh91.85 billion) rescue plan was unfair and said it would make it harder to reform US automakers.

"They need to restructure. If they get bailed out they are not going to do it," said Eric Smith, a paint contractor interviewed in Chamblee, Georgia, on the outskirts of Atlanta.

Democrats crafted the plan to help General Motors Corp, Ford Motor Co and Chrysler LLC and hoped to pass it during a post-election session of the Congress that was scheduled to start yesterday.

The three companies, whose gas-guzzling vehicles have been losing market share to Japanese rivals for years, are lobbying for the money to help them restructure and survive the economic downturn.

The stakes rose on Friday, when Goldman Sachs suspended its rating on GM and said the automaker needs at least $22 billion in aid. Goldman also said it would be difficult for Chrysler to survive without help. All three companies said Chapter 11 bank-ruptcy restructuring was not an option.

In interviews, many people said all of the options facing the automakers had drawbacks, including the proposed bailout.

"If they don't do it, a lot of people are going to lose their jobs," said Kevin Austin, 36, while fixing a car in a mechanic shop in Atlanta.

"But every big company is getting a bailout and the little people don't," he said.

The automakers are a symbol of industrial muscle in the world's richest country and their financial straits are seen as a sign of the trouble facing the US economy as a whole.

Minimum interference

Even so, the bailout is unpopular with many conservatives and others who say in a capitalist society businesses must stand or fall with a minimum of government interference. On Sunday, Arizona Republican Sen. Jon Kyl told Fox News American taxpayers should not be burdened with bailing out the auto industry.

"It's like nature's law: Only the fit survive," said John Berrotto, 50, a security director in New York who drives a Lexus and said he does not support the idea of a bailout. "Sometimes companies just don't make it," he said.

In Los Angeles, many people said they doubted a bailout was the best course of action. Some said it might be better for the companies to go bankrupt and that the bailout would be throwing good money after bad.

"I'm not sure they [the automakers] can be salvaged. If Honda and Toyota can make better cars in the US with American workers, so be it," said Tom Reiter.