Auto Industry Failure Would Lead to Disaster: Frank

Representative Barney Frank, the Massachusetts Democrat who heads the Financial Services Committee, said in his opening remarks before a still another hearing into the potential bailout that a failure of the companies would "greatly exacerbate the credit crisis."

Frank added that “I hope we will do something,” and that to not do something, with the November figures showing a loss of more than half a million jobs nationwide, would be “a disaster."

Despite these dire assertions, even those who support a bailout remarked dubiously on it.

“The condition of the auto industry is one of your making,” said Representative Gary Ackerman (D-NY). He added that while the initial estimate automakers gave was $25 billion, that number has risen to $34 billion, and he indicated he was disturbed by it.

Representative Peter King, Republican of New York, added that he might support some assistance, if it has “a reasonable chance of working.”

And that is part of the problem. Many have asserted that bailing out the automakers is throwing good money after bad, and that they will simply fail at a later time.

Sessions will continue through today.