Of the $1 billion allocated under the program, $775 million is out the door, catalyzing 184,304 transactions, the department reports.

Six of the top-selling vehicles are foreign, with the Toyota Corolla surpassing the Ford Focus at the top of the list new purchases. The others (in order of popularity) are:  Honda Civic, Toyota Prius, Toyota Camry, Hyundai Elantra, Ford Escape FWD, Dodge Caliber, Honda Fit and Chevrolet Cobalt.

The Transportation Department claims that the average fuel efficiency for the new purchases is 25.3 mpg, while the average mileage for the trade-ins is 15.8 mpg. But the administration is still refusing to release more detailed data surrounding individual transactions.

[W]hen the federal General Services Administration announced this week that it had spent $287 million in stimulus money to buy 17,205 new cars, it turned out that the biggest beneficiary was the Ford Motor Company, the only one of Detroit’s Big Three automakers that has not received a government bailout.

The General Services Administration, which manages a fleet of 213,000 vehicles for some 75 federal agencies, said it spent $129 million to buy 7,924 Fords; $105 million on 6,348 General Motors vehicles; and $53 million on 2,993 Chryslers.

Like buying Verizon stock, then grabbing an iPhone.

Yet the environmental goals of the program are quite modest. Although the White House press release on the subject claims that it will “prevent 26 million pounds of CO2 from entering the atmosphere,” it also states an “overall goal of at least a 10 percent increase in fuel-efficiency for the entire procurement.”

Studies have shown that 10 to 20 percent of a vehicle’s lifetime emissions come from its manufacture and disposal. If the government program results in the assembly of over 17,000 vehicles that are only 10 percent more efficient than those they are replacing, the overall effect is an increase in emissions.

The real impetus for this program, then, is to stimulate Detroit and help put the auto industry on a more eco-friendly path. The White House does not attempt to hide its aims; the press release states:

This accelerated GSA purchasing strategy is one component of the President’s overall commitment to supporting auto demand during this period of restructuring in the industry. Moving forward, the Administration will continue to work on several fronts to increase the flow of credit to auto consumers and dealers, and will work with Congress to pass an incentive program for people who turn in older, more fuel inefficient cars for cleaner cars.

Like a cash-for-clunkers program, this new fleet purchase is a small step toward a greener auto industry in the long term, even if its immediate effects are not as environmentally friendly as they appear.

As the auto industry decries the White House decision to reconsider California’s push for stricter emission standards, some environmental groups are quick to point out that several automakers have already pledged to meet the proposed guidelines.

Illustration by: Matt Mahurin

Business strategies submitted to Congress, as part of a December bailout debate, by Ford and General Motors would, if achieved, make the companies compliant with California’s proposed emission reforms — the same changes the companies have opposed for years — according to an analysis by the Natural Resources Defense Council, an environmental group.

Ford, for example, boasted that it would raise its fuel-economy standards 26 percent above 2005 levels by 2012, and 36 percent above the same baseline by 2015. General Motors, for its part, vowed fleet-wide fuel-efficiencies of 37.3 miles a gallon for cars, and 27.5 mpg for trucks, by 2012. (Chrysler, which did not include fuel-efficiency estimates in its report, was not a subject of the NRDC analysis.)

Both the Ford and GM plans — which surfaced during a December congressional debate over whether the Big Three should receive $34 billion in a taxpayer-funded bailout — set the companies on a pace that “easily” meets California’s proposed reforms, NRDC found.

Lawmakers had requested the strategies as proof that the companies could remain viable if they received the money. It wasn’t granted through Congress, but the Bush administration stepped in later with $17.4 billion in Wall Street bailout funding.

Supporters of tighter emission rules say the business plans are evidence that the automakers would be able to comply with California’s proposed changes, which call for a 30 percent reduction in vehicle emissions by 2016. In light of the sinking economy, they add, the move to more fuel-efficient vehicles might also help them sell more cars.

“They need to hold themselves up to a higher standard for their own survival,” said Roland Hwang, vehicles policy director at the NRDC and author of the analysis. “They can do it, and they’ve committed to it, in fact.”

Eli Hopson, Washington representative of the Union of Concerned Scientists’ Clean Vehicles program, conceded that the conversion between emissions and fuel efficiency is not a perfect science, particularly because California’s standards are derived differently than the national gauge. Still, he said, the NRDC report is good indication that California’s goals are achievable without overburdening the automakers.

“If [the companies] don’t reach the California standard,” Hopson said, referring to their viability reports, “they’ll be pretty close.”

The debate was renewed on Monday, when President Barack Obama — in yet another sharp break from his predecessor — announced that he’ll ask the Environmental Protection Agency to review California’s request to waive federal emission rules in favor of stricter state guidelines. State officials say the changes are necessary to rein in pollution and tackle global warming.

The Bush administration had denied California’s waiver in late 2007, arguing that it would create a confusing set of incongruous state standards that would prove harmful to automakers — a view Obama soundly rejected this week.

“This will help us create incentives to develop new energy that will make us less dependent on the oil that endangers our security, our economy and our planet,” Obama said. “Our goal is not to further burden an already struggling industry; it is to help America’s automakers prepare for the future.”

Many congressional Democrats, environmentalists and state officials agree. California Gov. Arnold Schwarzenegger (R) issued a statement calling Obama’s move “a historic win for clean air and for millions of Americans who want more fuel-efficient, environmentally-friendly cars.”

The California Air Resources Board estimates that tailpipe emissions pump more greenhouse gas into the air than any other source — representing 30 percent of the state’s carbon dioxide emissions. Adding to the urgency, the National Oceanic and Atmospheric Administration released a report Monday indicating that it would take at least 1,000 years for the climatic effects of carbon emissions to reverse themselves, even if emissions were halted tomorrow.

Thirteen other states and the District of Columbia have adopted California’s more stringent emissions standards, while four additional states have taken steps to install those standards as well. Together, the states represent roughly 47 percent of the country’s vehicles, Hwang says.

But the waivers have sparked an outcry from the automakers, many Republicans and Michigan Democrats, who continue to argue that the new standards would put undue burdens on an already struggling industry.

GM spokesman Greg Martin dismissed the NRDC report Tuesday, claiming that “their numbers were off.”

House Minority Leader John Boehner (R-Ohio) released a statement Monday saying that approving the waiver will “destroy American jobs at the very time government leaders should be working together to protect and create them.”

Sen. Carl Levin (D-Mich.) echoed those sentiments, arguing that “a separate California standard will not only create the “confusing and patchwork set of standards” that President Obama today implied he wanted to avoid, but also, as the California standard is currently drafted, it is discriminatory against U.S.-made vehicles of the same efficiency as the imports.”

Still, Chrysler and General Motors have, combined, accepted more than $17 billion from taxpayers to keep them afloat through March. And Ford, which hasn’t accepted bailout funding, has said it may be forced to do so in 2010 if the economy doesn’t recover. Some observers say the bailouts leave the automakers little room to fight the emission reforms.

A series of toned-down statements from the industry Monday seem to indicate that the companies are well-aware that their powers of persuasion have been vastly diminished. GM, for example, said it “is working aggressively on the products and the advance technologies that match the nation’s and consumers’ priorities to save energy and reduce emissions.”

The Alliance of Automobile Manufacturers, which represents foreign and domestic automakers, said it “supports a nationwide program that bridges state and federal concerns and moves all stakeholders forward.”

“The bailout means that the auto companies work for us now,” said Daniel Becker, who heads the Safe Climate Campaign, an environmental group.

This United Auto Workers advertisement printed in The New York Times on December 3 was accompanied by text that described the auto industry crisis as a Main Street issue, not a Wall Street one. (uaw.org)

When the chief executives of the Big Three automakers first came to Washington to ask Congress for a $25 billion-bailout, they arrived in town on private jets.

When 16 active and retired members of the United Auto Workers headed to Washington on Sunday night to press the need for government help, they drove the 500-plus miles from Detroit in four American-made cars.

Dressed in baseball caps and UAW T-shirts and showing signs of fatigue after the nine-hour drive, the workers appeared at a press conference Monday morning on Capitol Hill to make their case for government assistance. The blue-collar image these members of the Auto Workers Caravan projected contrasted sharply with that of the well-heeled auto and Wall Street executives who had preceded them.

Illustration by: Matt Mahurin

It helped to underscore the difference between how they see the proposed bailout of the auto makers and that given Wall Street. Taxpayer money wouldn’t go to highly paid managers and executives, as it did on Wall Street. Instead, it would be a temporary loan to keep their industry afloat through the economic crisis and protect the jobs of rank-and-file American workers.

“The [auto] companies are asking for a fraction of the money that was given to Wall Street,” said Bill Alfred, president of UAW Local 35 and a member of the Auto Workers Caravan. “They’re only asking for a loan — not a free gift, not a free ride. They want to get this money to protect the industry and pay it back [to taxpayers]. … Those folks from Wall Street came and asked for money for free.”

UAW member Tony Browning emphasized that the money would be paid back to taxpayers once the companies get past the current economic downturn. “I work for the Chrysler corporation,” Browning said. “And we’ve been through this before, in 1979. … We got a loan in ‘79, and we paid it back in record time, plus interest and everything. So that shows our credibility.”

During the debate over whether to bail out the car manufacturers or allow them to fall into bankruptcy, some lawmakers have blamed the UAW for the financial struggles of General Motors, Ford and Chrysler. They say that workers’ overly generous wages and benefits have drained the companies’ resources and made it difficult for them to compete with manufacturers overseas. These union critics want concessions from the UAW as a precondition for any bailout.

Union leaders, not surprisingly, reject the notion that concessions are needed. “Talk of more givebacks by our union ignores the cuts we made just one year ago, when our union agreed to a 50 percent wage cut, down from $28 an hour to $14 an hour, and no pensions for new hires,” said Hammer. “Reducing our quality of life would have a ripple effect on our entire economy, and would just make things worse. The reality is that our labor constitutes just 8 percent of the price of a new car. We could work for free, and it wouldn’t solve the crisis.”

UAW local president Alfred rejected calls by some lawmakers for the ouster of GM CEO Rick Wagoner as part of any bailout. No such demands were made of the financial industry as a condition for receiving taxpayer money, he noted.

“General Motors, Ford and Chrysler are asking for $34 billion, and [some lawmakers] want to remove the executive of General Motors. So how many people do they want to remove from Citigroup for wanting, what is it, $400 billion? I’m thinking that’s a lot of floors they’re gonna have to clear in that building. So before they start calling for resignations, they’ve got to check what they’ve already done and correct that situation.”

It is not every day that the UAW defends the management of a Big Three company. Yet the automakers’ dire emergency has brought the leadership of the UAW and the companies to the same table at congressional hearings to plead for help. “At this point in time, we agree with the auto industry executives that yes, they need the bridge loan, that yes, they are truly in financial difficulty at this point in time, and therefore that the government needs to intervene,” said former UAW Local 235 president Wendy Thompson. “We agree on that question.”

But the auto workers made sure to hammer home their contrasts with the executives. “We didn’t fly here in our jets,” said Chrysler employee Browning. “We left them at home.”

So says Rep. Brad Sherman (D-Calif.), a liberal member of the House Financial Services Committee, which hosted the three auto execs this morning to examine their requests for $34 billion in emergency loans.

There’s been much made of the $1 annual salaries that the CEOs say they’ll accept as a term for receiving that bailout. But let’s not confuse “salary” with “compensation.” Relative to bonuses and stock options, the salaries of corporate executives often constitute the smallest chunk of the pay package.

Indeed, last month Sherman asked each CEO if they’d be willing to limit total executive compensation to $1 million a year in exchange for the bailout cash.

All say they’ll forgo 2009 bonuses, but refused the $1 million cap. And there’s good reason why.

Ford CEO Alan Mulally, for example, received $22.8 million in 2007, according to Equilar, an executive pay database, via The L.A. Times. But less than half of that — just $9 million — came in the form of “salary and cash incentives.” The rest came from stock options.

For Rick Wagoner, the head of General Motors who received $15.7 million last year, $11.7 came in the form of “stock-based compensation,” the Times notes.

Chrysler, a privately held company, hasn’t released its executive compensation figures.

The stock of all three companies has been in the tank for some time, of course, but that could change for the benefit of the executives if the Big Three were to get some good news — for example, if they could secure $34 billion in taxpayer-funded loans from Congress.

In addition to the compensation question, Sherman also asked the executives: (1) if they would commit to closing foreign plants before domestic ones, and (2) if they’d be willing to set aside funds to honor warranties in the event their companies fail.

The California congressman wasn’t pleased with the responses. From his statement:

My three questions were designed to secure commitments protecting consumers and American workers from the risks associated with the financial difficulties of the Big Three automakers.  Unfortunately, GM, Ford, and Chrysler were unwilling to make these commitments.

Who said it was just Republicans criticizing the bailout?

It seems there was reason for their skepticism.

Chrysler yesterday afternoon was the last of the automakers to unveil its revamped business plan, which calls for $7 billion in federal loans before the end of the year. Combined with requests from General Motors for $18 billion and from Ford for $9 billion, that puts the proposed bailout at $34 billion.

It’s a drop in the bucket relative to the more than $7 trillion that Washington has offered to bail out Wall Street’s financial institutions. Still, remember when $35 billion over five years to fund a health program for kids was deemed too expensive? It’ll be tough to make that same claim when SCHIP returns next year.

Fast forward nearly 30 years, and several lawmakers have put the Iacocca challenge to the CEOs of Detroit’s Big Three, who are in Washington this week pleading with Congress for a $25 billion bailout to buoy the sinking industry.

During a Senate Banking Committee hearing with those executives yesterday, Sen. John Tester (D-Mont.) asked point-blank if the well-compensated executives would be willing to make the same sacrifice that Iacocca did. Only one, Chrysler head Robert Nardelli, answered non-evasively. ” I’d be willing to accept that,” he said.

The other two — Ford CEO Alan Mulally and General Motors executive Rick Wagoner — showed no such alacrity for a $1 paycheck. Wagoner boasted of cutting his salary “unilaterally 50 percent” a few years back, but had little response when Tester pointed out that half of an enormous salary is still enormous, relatively speaking.

Mulally rejected the challenger even more bluntly. “I absolutely respect the intent of your question as a symbolic gesture,” he said, “but it is a symbolic gesture.”

Such remarks may not play well with Congress. Even supporters of the auto bailout are warning that huge pay packages for executives of bailed-out companies leave a bad taste with an American public that’s also struggling in the economic downturn.

“I can’t begin to tell you,” Sen. Chris Dodd (D-Conn.) told the CEOs yesterday, “what sort of reaction there’d be from the public if you on your own would be willing to take some steps that would reassure the American public that their dollars, if they’re going to be forthcoming, are not going to be used in any way to provide exorbitant salaries and fees to people.”

Judging from the behavior of banks after they got their $700 billion bailout, lawmakers might do better simply to write such restrictions into the legislation.

Senate Banking Committee Chairman Christopher Dodd (WDCpix)

More than 50 years ago, when the head of General Motors said that what’s good for General Motors is good for America, few would have disagreed. But Tuesday, the company’s CEO couldn’t convince a panel of 21 senators that the idea still rings true.

Along with the heads of Ford and Chrysler, Rick Wagoner urged senators to lend $25 billion in emergency aid to the three teetering auto makers. Without that help, the executives warned, one or more of the companies could fail. GM says that it’s burning through cash at a rate that could drive it under before Christmas. The economic effect of the car manufacturer’s collapse, the executives claimed, would reverberate far beyond Detroit.

Illustration by: Matt Mahurin

“The costs would be catastrophic in jobs lost, income lost, government tax revenue lost and a huge blow to consumer and business confidence,” Wagoner testified before the Senate Banking Committee. “This is all about a lot more than just Detroit. It’s about saving the U.S. economy from a catastrophic collapse.”

While the debate focuses on Detroit’s auto makers, the issue, some experts say, is nothing less than the future of U.S. manufacturing — and the nature of the country’s workforce as a whole.

Thomas Geoghegan, a Chicago labor lawyer, said the failure of any of the Big Three would signal a cultural shift, signifiying the fall of the United States as the world’s premier industrial powerhouse.

“It would be a dramatic marker in what has been a very slow collapse of the U.S. as a manufacturer,” he said.

Geoghegan, who has represented labor unions, said he supports a bailout of Ford, GM and Chrysler — with reservations. If the proposal is part of a renewed government commitment to get the country manufacturing again, he said, it would be worth it. “Otherwise,” Geoghegan said, “it’s probably just a waste of money.”

Many leading economists say an injection of capital is worth the risk. Appearing Sunday on ABC’s “This Week with George Stephanopoulos,” Paul Krugman, the Nobel Prize-winning Princeton economist and New York Times columnist, warned that allowing the automakers to fail would jeopardize every other stimulus package and bailout bill Congress has passed this year.

General Motors CEO Rick Wagoner (gm-volt.com)

“Letting GM go under is an enormous anti-stimulus policy,” Krugman said. “It would be working toward a major negative blow to the economy.”

Many Democrats tend to agree. Party leaders have introduced bills in both the House and Senate to use $25 billion from the $700-billion Wall Street rescue plan to prop up the sinking automakers. The money would cover the companies’ operating expenses, including wages, auto parts, health care and pensions. More important, supporters say, it would keep them making cars and trucks.

“We need this industry as a basic part of the fabric of our economy,” insisted Sen. Debbie Stabenow (D-Mich.), an ardent industry defender. “Somebody has to make something in America. Credit default swaps alone, moving paper, aren’t going to do it.”

Standing in the Democrats’ way are the White House and many Senate Republicans, who oppose tapping the Wall Street rescue fund to help Detroit.

“That money is specifically for the financial industry,” White House spokeswoman Dana Perino said Tuesday, “to help prevent collapse in our financial system.”

Republicans want Detroit to tap a $25 billion fund, passed in December, to help the automakers retool their factories to improve their fleets’ fuel efficiency. Republicans appear to have the numbers to kill the Democratic bill this week.

Sen. Chris Dodd (D-Conn.), chairman of the Banking Committee, gave a stormy forecast Tuesday for the bailout’s chances in the Senate. “I would like to tell you that, in the next couple of days, this is going to happen,” Dodd told the industry heads. “I don’t think it is.”

The golden days of the American automobile industry are long gone. (Flickr: califrayray)

Much of the debate centers on ideology. Republicans, already stinging from government interventions to keep the financial system working, want market forces to determine the fate of the Big Three.

“Do the American people want to borrow from their children to prop up companies that are dinosaurs, that have failed models, that have no innovation to speak of, just to hold jobs?” Alabama Sen. Richard Shelby, the highest-ranking Republican on the Banking Committee, told CNN Monday. “The government is choosing winners and losers in the marketplace. It won’t work.”

Many critics of a bailout have suggested that bankruptcy is the answer for the struggling automakers. That, they contend, would allow the industry to continue producing vehicles — and keep employees in jobs. As an example, they point to the case of United Airlines, which operated under Chapter 11 bankruptcy protection for much of this decade.

But others see a series of pitfalls with the bankruptcy strategy. One is that consumers might be leery of buying cars from a bankrupt automaker. “What’s a five-year warranty worth if the company that produced the car might not be around next year?” asked John Schmitt, senior economist at the Center for Economic and Policy Research.

A bankruptcy in the airline business is different, Schmitt claims, because travelers tend not to care much about the long-term financial health of their carrier. “They may not be around two years from now,” Schmitt said, “but they’ll certainly be flying to Cincinnati this afternoon.”

There are other concerns with the bankruptcy option. Generally speaking, a company files Chapter 11 when reorganizing the business is thought to be more profitable than closing shop altogether. In the case of the auto makers, however, the revamping could have little effect if credit markets don’t finance the reorganization or the purchase of new cars. Even if GM were producing 1,000 Chevy Volts (the company’s plug-in hybrid) every minute, Americans couldn’t scoop them up if they couldn’t obtain credit.

“Chapter 11 quickly becomes Chapter 7,” Krugman said on “This Week, “which is liquidation. So we actually see the thing disappear.”

Such a failure could result in the loss of hundreds of thousands of jobs nationwide, experts predict. Susan R. Helper, economics professor at Case Western Reserve University, estimates that 500,000 jobs would be lost if just GM — as well as the companies that supply it exclusively — were to shut down. Faced with numbers like those, she said, a $25-billion investment would be well worth the risk. “The advantage of keeping jobs in a recession is pretty clear,” Helper said.

On one facet of the debate, all sides agree: It’s been a tough ride recently for Detroit’s automakers. Faced with slumping sales because of the credit crisis, the Big Three are burning through their cash at a breakneck pace. In the third quarter of this year, GM rifled through $6.9 billion, while Ford spent $7.7 billion and Chrysler $3 billion. On Tuesday, as the corporate heads were testifying before Congress, Ford’s stock price fell 4 percent, and GM’s nearly 3 percent, to lows not seen in decades.

The performance of the companies has led many bailout critics to wonder aloud why anyone would want to save them. “People who say General Motors is too big to fail have not noticed that it has failed,” conservative commentator George Will said Sunday on “This Week.”

The industry hasn’t done much to help its cause. After years fighting fuel-efficiency standards that might have made the Big Three more competitive in these lean times, the companies were quick Tuesday to attribute their troubles largely to the bad economy, not misguided internal decision-making. Meanwhile, foreign companies like Honda and Toyota are years ahead of Detroit in developing smaller, more efficient engines.

Many in Congress — even supporters of the auto bailout — doubt $25 billion will be enough to get the companies through the recession. “You’re asking an awful lot,” Dodd told the company heads at the end of Tuesday’s hearing. “And I suspect … that this $25 billion is not going to be the end of it.”