Extending aid to struggling automobile manufacturers is not fair to taxpayers and does not make fiscal sense, House Republican Leader John Boehner has said.
He was responding to a plan by Democratic lawmakers which would put aside $25 billion from the Treasury Department’s bank rescue plan to be targeted at the troubled auto industry.
Boehner questioned the wisdom of giving billions of dollars to companies without addressing underlying problems in the sector.
"Spending billions of additional federal tax dollars with no promises to reform the root causes crippling automakers’ competitiveness around the world is neither fair to taxpayers nor sound fiscal policy," he said.
Boehner called for carmakers to prove they have "a credible plan" for how to improve their situation, as well as asking Democrats to make a statement to taxpayers about how any bailout money would be recouped from these firms.
Earlier this week, Bloomberg reported that President-elect Barack Obama is supporting $50 billion in aid to the automotive industry.
Obama reportedly fears that without these funds, General Motors could be forced to file for bankruptcy by early next year, leading to substantial job losses.