Sen. Richard Lugar (R-Ind.), a floor manager of the bill to bail out financially ailing Chrysler Corp., yesterday opposed compromise legislation that does not require company workers to accept a three-year wage freeze.
Lugar restated his earlier position, however, that he would not insist on a wage freeze if the United Auto Workers union were willing to make other sacrifices to aid the company. Lugar appeared to leave the door open for further compromise.
The Indiana Republican is co-sponsor of legislation approved by the Senate Banking Committee and cleared for floor action by the Senate Budget Committee that would freeze all Chrysler wages.
The compromise plan, which has the backing of both the UAW and Chrysler, would cut the total amount of aid from the $4 billion proposed in the Lugar bill to $3.3 billion. The compromise bill is sponsored by Reps. James Blanchard (D-Mich.) and William Moorehead (D-Pa.).
But the new proposal raises the federal contribution to the ailing auto manufacturer from $1.25 billion to $1.5 billion, cuts the labor contribution from $1.077 billion to $400 million, and totally removes the $243 million management contribution contained in the Senate plan.
Lugar, who will mange the bill when it comes to the Senate floor, possibly by the end of the week, reiterated his view that he is not committed to the three-year wage freeze for Chrysler workers contained in his bill. He is, however, committed to sacrifice by the union members.
In addition, Lugar said he was opposed to the removal of a three-member Chrysler "review board" from any legislative package. The compromise plan calls for a monitoring of Chrysler operations by the Treasury secretary, rather than a panel composed of the cabinet member, the chairman of the Federal Reserve Board, and the comptroller general.
The Lugar-Tsongas bill was cleared yesterday for floor action by the Senate Budget Committee. That panel, which must review any legislation that calls for expenditures beyond congressional budget targets, approved Senate consideration of the package by a 14-1 tally.
Tsongas, meanwhile, said he would reluctantly support the compromise plan, although an aide said that Tsongas, like Lugar, believes $4 billion in assistance is needed to enhance Chrysler's prospects for survival.
"Chrysler might need a larger package, rather than a smaller one," Lugar told reporters. "Already, worst-case assumptions ought to be involved," he said, noting the recent downturns in sales for auto industry as a whole.
Although UAW President Douglas Fraser has said he would rather see Chrysler collapse than accept the Senate committee's plan, Lugar insisted yesterday that labor must contribute a more substantial share than the $200 million in concessions contained in the union's recent three-year contract with Chrysler.
"I'd rather see a demonstration of people trying to save their jobs, rather than negotiate a figure," Lugar said. "The wage increases are only increases if you have a job, if there is a wage at all."