House Republicans failed in their effort to strip $1.5 billion from an automotive loan program that helped Tesla Motors reopen a shuttered car factory in Fremont.
The House voted Tuesday to approve a temporary spending bill, called a continuing resolution, that leaves the Advanced Technology Vehicle Manufacturing Loan Program intact. A previous version of the bill would have cut $1.5 billion to help pay for responses to Hurricane Irene and other disasters, leaving $2.5 billion remaining, but lawmakers rejected that proposal last month.
The bill will now go to President Barack Obama for his signature. The measure, which approves $1.043 trillion of federal spending until Nov. 18, is needed because Congress has not approved a budget for the fiscal year that began Oct. 1.
The proposal to cut the loan program's funds met with a sharp backlash from Democrats and environmental, business and labor groups.
"Passage of today’s continuing resolution represents a real victory," said Rep. Anna Eshoo (D-Palo Alto), who organized Democratic opposition to the proposed cuts. "This is a highly successful program that has produced jobs."
Palo Alto-based electric car manufacturer Tesla Motors borrowed $465 million under the loan program to reopen the NUMMI plant in Fremont. CEO Elon Musk recently told the Detroit News that the company would not apply for any additional funding under the program.
Tesla isn't the only car manufacturer to benefit from the loan program. It helped Nissan build its first electric car, the Leaf, and it is helping Ford develop technology that will reduce the number of cylinders in its pickup trucks. Steel maker Severstal also used funds from the program to upgrade a factory in Dearborn, Mich., where 260 workers will manufacture lightweight metal designed to reduce vehicle weight.
The advanced vehicle program was signed into law by President George W. Bush in 2007 and funded with $7 billion of federal stimulus funds in 2009.
David Zisser
Talk about "crony capitalism"! If the Democrats can't find a way to defy their political paymasters, then this nation hasn't got a chance. Tesla Motors is an unviable entity producing a handful of cars so the environmentally-concerned wealthy can pretend they are doing something for the environment. And Tesla's founder and CEO, Elan Musk, doesn't even run this sinkhole for taxpayer dollars full time: He's far too busy trying to get the feds to pour money into his space company and his alternative energy cocompany on whose board he serves as chairman. Unbelievable. Musk is less an entrepreneur than a corporate welfare chiseler. And Anita Eshoo is a typical Democrat Congressional idiot claiming that these programs create jobs. How much is it costing per job at Tesla or Fisker Motors, another corporate welfare sinkhole that produces its cars in Finland, of all places.
When Tesla tanks, the Obama Administration will try and cover up this disaster by forcing a viable car maker like Nissan or Ford to buy it and swallow the loss probably with another subsidy of taxpayer money.
When private