by millions of individual tax paying americans, some may want to cash in right away and some may want to hold it and some will want to see. most believe there's a sycophant upside potential and they may give it to their kids and folded a long time. i think frankly that is this going to happen if the company is run by and they will be run right with the additions of the bennett concept to the amendment ..

any questions? >> have you gotten any reaction from the administration and is there any concern about the complexity of distributing that to the taxpayers? >> the irs knows where to find this so i cannot find this when giving us something, it didn't have much problem with tax rebates that took a few months, they have the names and addresses and electronicç files on the people who file on april 15th and ought to be relatively easy to get stock to this. typically in the way stock is held in america today the company holds a stock

certificates on behalf of the individual owners so about all you have to do is love the 120 million americans now have a few shares of stock in gm and chrysler and when this time to sell will go to the process. it should be relatively simple. >> was there any response to the administration? >> i haven't suggested to the administration, i've been thing about for several weeks in seemç perfectly obvious. the president of gm made it clear,ñr it is the treasury decision according to the way the law is today eq he saysç it's a large amount of stock and as senator kyl said the selling would probably be done in stages over years. this could be done in a few months and we're out of it, it would mean 120 million or so americans who own general motors and chrysler, 60% of gm. in the uaw owns about

17 percent, that is nonvoting, the government of canada owns 12% and the bondholders would be widely dispersed that we would be back in the way the companies are supposed to operate and the president is set of driving their hybridsç from detroit to washington every day to answer some subcommittees' questions about the next car model couldç focus on designing and building and selling cars and competing and try to make the value of the stock go up. >> senator alexander, with so many in your home state would to support any legislation that would support those jobs? >> i don't know what kind of legislation would that be? i believe in the freeç market. the jobs are in tennessee them have gone from having no jobs to having a third of our manufacturing auto jobs because we're the best competitive place to build cars, we have low taxes and other states don't, we have one of the best four-lane

highway systems and others don't spiritoso that is why nissan has been the most efficient auto plant in america many times while volkswagen chose tennessee and i think the spring hill plant of gm will be successful. >> you would support legislation that would china and the government attack those jobs?ç >> no, you can't run a country that way, that is the direction we're headed, to go theç other way and say let the free market work, get the stock at a washington so everybody could try to run theç car companies. >> and maybe more efficient for gm to downsize their headquarters or in is easier to do business but the president is on with the phone saying we're going to be the headquarters in detroit and that is exactly the kind of political decision that has no place in the running of the company for the value of the stockholders. >> the unemployment numbers coming out tomorrow, are you

encouraged by that and what you think we're going to see. >> i don't think -- i won't try to forecast what we will see tomorrow. in the unemployment problem is a chorus a serious one and it is a tragic one for those people who have lost their jobs. and i say that as one who has lost my job at various points in my career and as one who has seen my son lose his job in the financial crisis. it is a time of great, great difficulty for the individuals and for their families. fortunately my son found another job and i have found another job that i'm trying to keep. that having been said however on with one of the things we have learned is artificial attempts

to maintain employment that go against market forces one prolong recessions and sometimes run them into depressions, and there is evidence with respect to the great depression now as we go back and study that that many of the things that were done in the name of protecting jobs in the great depression, in fact, caused it to last year's long for than it otherwise might have done. you can read the literature on that and come to your own conclusion about how convincing in maybe but moctç important thing we must do is get manufacturing and all of those parts of the supply chain in the support manufacturing back in a healthy condition again and it is not just automobiles and every portion of the economy that is to come back. you ask about individual states. in my state the last time i think we had the unemployment rate than it was 4.8%. i expect it will be higher than

that to as the recession continues to have its problems, but that significantly below where it is in many other states and that underscores the fact that while there areç national unemployment rates they vary dramatically from one week of the country to the other, the recovery is uneven, there are some parts of the country where housing prices haveç stabilized and, indeed, some were there actually rising. remember this whole thing is caused by the bursting of the house and bubble so with housing starts to get fixed that is the most important single thing that can be done to get the recessioç fixed. other parts of the country where the housing crisis still are dropping and frankly need to drop before you get stability, so we will look at the national numbers with interest of but the solution to the problem of will come from the economy and in the

actual creation of employment activity region by region. >> [inaudible] >> i supported the first round of t.a.r.p. it because it was to prevent an international meltdown of the financial system and i believe it did. and i believe it was justified. i have voted against every other distribution because i disagree with the way they are being managed and maybe good intentions, but i'm not at all sure they are going to be a successful as to their supporters said they would be. >> [inaudible] >> gm is a course in vividly a stock company, there's other equity and debt. i don't think that is the

situation with aig and obviously you'd have to look at it to say but i don't think that is. >> i excluded banks for my amendment. the taxpayer own sister% of the new gm and owned a percentç of chrysler. that is very straightforward and simple, we would disagree that within a matter of months. the bank stocks and warrants that we may own could be more complicated, i wasn't willing to include that as part of this but i've studied that. >> i'm sorry, i misunderstood, i agree with his answer. [laughter] >> thank you. [inaudible conversations] >> the heads of chrysler and general motors testified on capitol hill wednesday about their plans to close thousands of auto dealerships. the senate commerce committee

also. from two auto dealers, this is a little more than three hours. [inaudible conversations]ç >> this hearing will come to order. three weeks agoç chrysler announced that it was going to terminate 789 franchises on a nationwide basis. i spoke with pete lopez who is here with us, he is an auto dealer fromç spencer, westç virginia, it's not the largest city in the world but it is one of the finest andç is right ina rural west virginia so it sets up the whole tone of this. and he learned that his contract had been terminated with

chrysler, so obviously he was very concerned about that. we talked on the telephone and knows a lot of anxiety and concern and worry about his people and in a sense of a flash his whole life sort probably some 30 years or so taking care of people in servicing cars and selling cars both chrysler and the general motors all of a sudden seemed very much in jeopardy. well, that is the way it felt but then compound and that;hp w days later mr. lopez learned that also gm wasç going to terminate their franchise with m and a lot of other folks putting more ofç his workers at risk. the storyçç is obviously not d

to pete lopez, it is a nationwide tragedy that a lot of us feel very strongly about, something that should notç have happened and can be corrected. it is a story certainly has echoed through out west virginia nearly anna nationwide basis, nearly 2,000 dealerships that are closed threat america, 100,000 jobs at risk. thoseç are not unfamiliar figus in these days but nevertheless 100,000 people potentially at a fork were probably out of work is on happy so we have to do better. we can save some of these jobs and we can help some of these committees and we have an obligation to do that. let me be very clearç -- i honestly don't believe that companies should be allowed to take taxpayer funds for a bailout of and then leave it to local dealers and their customers to fend for themselves

with no real plan, no real motives, no real help. is just plain wrong. you don't do that. so we are talking about dealers who invested everything they have, many who have been added for many many decades, a generational thing with it families some of whom are here today, you know, they are just looking into the black: out. they don't know what is going to happen. they don't know why this is the fall on them, why were they picked, what was the process, was their pressure, and the politics involved? all of this we will get into this afternoon. we're also talking about the consumer, people who were just as firm as they can in west virginia and all of our states. people work up till all the time just striving to make it coming to survive. every penny counts, every mile accounts, every part of a car

accounts. if it isn't working. but chrysler is eliminating 30 -- 40% of its dealerships in my state which isç about twice wht they're doing on a national average in gm i believe it will eliminate more than 30% which is about 40 percent more than what they're doing or 60 percent more than on a national basis. said this means that some consumers and west virginia will have to travel muchç farther distances to get their cars serviced under warranty because if you don't have a warranty you can get your car serviced and we will talk about that too. does that have to define the terms in aç crisis. so basic economics also says that the fewer dealerships you have those a better left and selling chrysler or gm products that the last competition saw the price go up,ç that's just economics. i think each company has

responsibility to assure thisç committee that is not using this restructuring process as a way of unfairly increase in prices on hard-working americans who haveç remained loyal to them again over many generations in many cases and to the domestic auto industry. i want to emphasize today the consequences of chrysler and gm sashes are very real, to west virginia and other states, gm and chrysler we're hearing from americans every day with and we want you to hear as i'm sure you have, we want you to hear what people have to say so that is what this hearing is about. so i am very glad that we have this panel. it's a chance for you to make your case as those of you are auto executives as to why are companies are taking these actions or tell us what you will do differently moving for and if

you plan to. my concern runs very deep. i went to west virginia's as a volunteer and my heart is on main street, that's not a political cliche to me, i really care about people that work hard and are always fighting uphill and somehow they never seem to get a fair shake, so these of the most challenging economic times as the great depression. we have to come together and do everything we can to make sure dealers and employees and everyone involved does all right here and i do understand the need for chrysler in gm to organize, that's not a question here. but to do this at the expense of workers and consumers in the wrong way is just plain wrong and this committee and the american people will not stand for it to. thank you and i call upon the ranking member, kay baileyç hutchison. >> thank you mr. chairman. mr. chairman, which you all]w me

to ask every person in the audience who is a dealer to stan. >> of course. >> thank you very much. we really wanted to seeing the people who are facing the issues that we're talking about today. i think mr. chairman, first of all, thank you for holding this hearing year ago i think that after the supplemental appropriation a week before last just as i was offering my amendment to try to extend the the time for these chrysler dealers especially to be able to shut down their businesses and an orderly way, i got word that you were going to set this meeting for this week and i appreciate it because i think we need to hear what is really happening. is been about 10 days since we

had the debate on the floor and we have the assurances, mr. press of chrysler that they would be contacted with dealers who are being closed. i want to set the stage because it was just the week before last that i was contacted by some of the dealers in my state who were affected and in the received a letter from chrysler dated may 13th of 2009 saying that the agreement would be rejected with the steelers. as of june 9thç. and that meant about three weeks' notice and here was the attachment to the letter -- as a result of his recent bankruptcy filing chrysler is unable to repurchase or new vehicle inventory. as a result of his recent bankruptcy filing, chrysler is unable to repurchase your parts inventory.

as a result of the recent bankruptcy filing, chrysler is unable to repurchase your essential special tools. so many of the dealers, who have been in operation and have had the burden of paying the taxes, hiring employees, doing business in a community and being an employer that is providing a part of the economy of this great country were notified after years of service that they had three weeks and basically no obligation from the company. so i did introduce an amendment to say 60 days, not three weeks. well, then as we started debating this on the floor, all of a sudden i had five co-sponsors and then 10 and then 15 and by the end of the afternoon, i was talking to the

chrysler executives, we had a 38 bipartisan democrats and republicans cosponsoring the amendment. the agreement that came pouring in from that process was that chrysler would, indeed, do everything possible and make commitments to the dealers that they would take every piece of inventorying and the specializeç equipment that could be transferred by june 9th so i look forward today to hearing from mr. press about the progress on that and i look for to hearing from the dealers about whether that they have had that kind of outreach from chrysler. in addition, just this week general motors has begun its process the saying that it would close up to 40% of its dealerships which would be

approximately 2300 and give our take of the dealerships in this country following on sun hundred 89 dealerships from chrysler. now, just to put this in perspective, these families of these dealers who have made such an investment and who have taken a really the financial burden for these dealerships the monday by the inventory, they take the financial risk the, it's a huge burden for those who have stood and those around the country. but we're alsoç talking about 40,000 employees of these dealerships so we're talking about 40,000 families the size of the dealer some solace and we're talking about communities because i remember selling ads for the high-school football program and my hometown and u.s. the right person to buy that program for the students that came in for their first

experience at selling -- it was of the auto dealer in town and my home town we had one. i remember that and i know all of this country people remember that. united way to is their first supporting the community for those less fortunate, it's the auto dealers and their employees so they are the backbone of the community and so every community or these auto dealers are going to be shut down is going to see loss in revenue, of course because the families are going to have to look for other jobs but also their own charitable end community events will also suffer. so i think it's very important that the ceo's are here of our and i for one want to know how

this process is working. i want to know from gm how it is going to work and i want to see if there is any mitigation with these communities and families that will come foreign and it is not our place to change your decision but is certainly is our place especially when there's so much taxpayer money through a shareç, and we have heard from the people to make the cars and the workers and we've heard about the bond holders and the stockholders and now today we are going to your about the dealers because i think they have nothing to do the design of cars, nothing to do it the cost of the company and yet 40,000 people from chrysler are losing

their jobs and then general motors is yet to come. i think it is congress's responsibility to look of the whole picture of this economic impact. thank you mr. chairman. >> [inaudible] >> thank you mr. chairman for holy this hearing, a look for to hearing from the witnesses, i want to specifically mention my constituent dealers here today. a shock of the chevrolet, a gm dealer, cronus motors, pontiac in bloomington, gm taylor, scott motors and rafal which is a chrysler dealer, nelson on a center in fergus falls which is a gm dealer an eerie dodge chrysler unlike elmo. what is so puzzling for so many other dealers in minnesota is a the some of these dealers are actually doing pretty well. walter buick pontiac for four

out of the past five years has been number two in sales for all buick pontiac gmc dealers in minnesota, if you're a dodge chrysler had an 85 year record for sales in january with 103 new cars sold in beat the record again in may with 113 new car sales, carona motors increased as new-car sales by 30% last. service work increase by 75%. yet these three dealers received termination notices. so understandably they have questions they want answered today about how these decisions were made, why they were given so little time and if there is any time that can be extended. and they feel that these decisions may have been made in the boardrooms and enshrined but they are affecting people in the living rooms in minnesota. this is about local communities as senator hutchinson described as senator rockefeller described throughout this country, and is about home grown locally owned businesses as well as the employees and customers to

depend onç them. gm and tom letter to are here today are co-owners of. josh chrysler, the business unlike, for decades with 40 workers of the largest employer because of what was going on, they actually had a rally this saturday, 400 people showed up here and i received a 1200 letters from people in this community that what this dealership to stay open. and the things that we are most concerned about the minnesota is, first of all, why there is in some kind of internal appeals process, chrysler cited, for those that think they have been wrongly targeted. when listing seven made in and knowledge by the auto industry in the past would lead one to believe there could be mistakes made in decisions about which auto dealership should beç terminated. we are concerned as one of the early co-sponsors because concern about the timing. some of these dealerships have been in business for decades and are given 26 days.

on the gm side if they were given longer time but some have been given letters which only give them until july 12th to make a decision. notç enough time to make decisions, not enough time to make sure that they haveç sold their cars and not enough time to get their employees some kind ofç landing brown and these are employees just like there are employees in detroit. there are the heart and soul of so many communities in our state. so what we would like to see is some fairness intended into this process. obviously it is your decision to make but when talking about taxpayer dollars, talking about families in a difficult economic time we would like whatever fairness we can find to be injected into this process and that's why we're here today. thank you very much.ç >> next would be senator johannç

>> mr. chairman, thank you very much, i appreciate you conducting this hearing and it is good to see you back. inbox -- here is the problem as i see it. i think everybody has spoken very eloquently about the difficulties of this has caused back, and we are all in getting the phone calls and letters. i got a bullet points from one of your dealers at chrysler talking about the jobs that are going to be lost, how unfair the to was two have so little time after being part of the organization for so long. but here's the problem -- the deal is done.

i never would have believed as a candidate for the united states segment that the united states government could buy general motors without a hearing, with no vote yes or no, that a dealership plan could be rolled out, that literally put people out of work. this was supposed to save jobs i thought, put people out of work with no oversight. i never would have imagined in a million years that that could be accomplished and i find that to be issuing bother some. there are billions and billions of dollars at stake here. the other thing that i will share with you -- i think if i would have called anyone of my constituents back in nebraska on friday and said to them, i have been