Sen. Richard Shelby opposes a federal bailout for Detroit automakers and thinks Chapter 11 bankruptcy would be the best solution for the Big Three. On This Week, the Alabama Republican told George Stephanopoulos that the domestic car companies want to be on a taxpayers'92 relief fund.
"They can't turn these companies around. They've got failed models, failed leadership," Shelby said. "They've been paid billions -- millions and millions of dollars for running weak companies. This didn't happen overnight. This has been going on for years."
On the Sunday morning program, Shelby debated the New York Democrat, Sen. Charles Schumer. According to Shelby, a federal bailout would reward failure unless the Detroits automakers completely retooled their companies.
He also said the proposed $25 billion bailout is not guaranteed to work. The federal government could give Detroit more than $50 billion with no effect.
Alabama is home to three automobile plants '97 Mercedes, Hyundai and Honda. The proposed auto bailout would not benefit those car companies even though they employ thousands of workers here.
Similarly, Shelby said he opposes federal support for Citigroup, the latest bank to flounder.
Sen. Schumer argued that the government learned with the collapse of Lehman Brothers that the ramifications of letting banks go broke is far worse than propping them up.'a0
Both senators complimented President-elect Barack Obama'92s choice for Treasury secretary, Timothy Geithner. Shelby called the Geithner young, energetic and a '93breath of fresh air.'94
Shelby is the ranking Republican on the Senate banking committee. 'a0
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