Senate Moves On Auto Safety, NHTSA "Revolving Door" Legislation, Stands Firm On Dealer Finance Oversight

The Treasury may be standing by GM’s “payback” claims, but the Congress hasn’t exactly been looking for ways to do the auto industry any favors. In fact, a toxic brew of political fallout from the financial crisis, auto bailout, and Toyota recall scandal has seems to have inspired a backlash against the industry that came to a head this week in the US Senate. Legislation has been introduced that would prevent NHTSA officials from taking jobs with automakers for up to three years after they leave the agency, and yet more is being drafted which could require a vast array of standard safety equipment on all cars sold in the US and could even add a federal fee to new car sales. Adding insult to injury, a much-hoped for exception to dealer financing oversight in the new financial reform bill appears to have fallen victim to Senate negotiations. Did nobody tell the old guys that they’re investors in the auto industry?

But it was Toyota, not the state-owned automakers, that figured most heavily in the Senate’s proposed regulatory binge. Senator Barbara Boxer (C-CA) introduced legislation aimed at ending the “ revolving door” between NHTSA and industry lobbyist jobs, a topic of much discussion in the Toyota recall hearings. According to the LA Times:

Only jobs involving direct communications with NHTSA would be prohibited, and only top NHTSA officials, or those involved in safety regulation, would be subject to the rule. The bill filed by Boxer would impose a $55,000 fine on individuals and $100,000 or more for automakers, in case of a violation.

Yawn. Most automakers are probably moving in this direction anyway, what with the post-Toyota recall PR environment. The more interesting piece of legislation emerging from the Toyota hearings is a comprehensive auto safety bill that the Detroit News says is being drafted by Senate Commerce Committee chairman Jay Rockefeller (D-WV) and House Energy and Commerce Committee chairman Henry Waxman (D-CA). According to congressional aides speaking to the DetN,

the authors are considering imposing a small fee on new car sales that would fund an increase in the budget of the National Highway Traffic Safety Administration

Say what? For more distracted driver initiatives, complete with Oprah-meets-Eliot Ness photo-ops? So, what else do the authors envision this bill doing?require all automakers to install anti-runaway technology, such as brake override systems, stop-start technology and event data recordersSince when does stop-start technology have anything to do with “anti-runaway” safety? Apparently we’re going to have to wait until draft legislation is released later this week to find out. The same goes for the dealer finance oversight legislation, which appears to have died in the Senate. Republicans have only just allowed floor debate to begin on financial reform legislation, and we likely won’t hear definitive news on a possible dealer finance exception until tomorrow.In the meantime, if you happen to be a member of the House of Representatives, and you’re starting to feel badly about how your Senate colleagues have been treating the industry, take heart. You have an opportunity to make it all right, and in a way that will largely benefit a government-owned automaker. According to the DetN, GM is joining auto suppliers and others in lobbying for the passage of changes to the Alternative Minimum Tax currently before the House [ bill text here]. The changes would allow AMT credits from capital investments to be taken immediately, preventing companies from having to prepay AMT and claim credits in subsequent years. With GM announcing $2.3b in North American plant investments in the last ten months, this legislation would work out marvelously. And why make The General pay tax on the taxpayer’s money, especially the part that’s actually going towards creating new jobs?