Bush administration assures U.S. automakers

"Otherwise, we're just giving life support, rather than a lifeline for viability into the future," Pelosi said.

White House spokesman Tony Fratto said the administration was reviewing the automakers' financial information and would not specify when a decision will be made.

"We're considering our policy options, and when we have something to announce, we'll announce it," he said. "We'll take the time we have available to get the policy right."

The White House is keeping President-elect Barack Obama and his advisers informed of the discussions. If administration officials choose not to provide the money now, the Obama team could wait for the new Congress, which will have stronger Democratic majorities. But the delay could risk bankruptcy filings by GM and Chrysler.

White House officials previously had insisted on limiting use of the Wall Street rescue plan to helping financial institutions. It changed course after the auto bailout bill failed in Congress, citing the consequences to the overall economy if U.S. carmakers should fail.

Not everyone agreed. South Carolina's Republican governor, Mark Sanford, said in a letter Monday to Bush that using the financial bailout fund to help automakers could "be a very great mistake."

"It would open the floodgates to federal monies for every distressed industry across this country _ and there will be many in this economic slowdown," said Sanford, whose state hosts a large, nonunion BMW plant that has about 5,400 workers.

Michigan Gov. Jennifer Granholm, a Democrat, countered that prompt financial aid was critical because the Detroit-based U.S. auto companies are uniquely connected to other industries, including textiles, glass, plastics and steel.

The auto industry "would take down a huge array of businesses and jobs across the nation if it were allowed to fail. I believe the Bush administration understands that," Granholm said in Lansing, Michigan.

Levin said he expects Bush's solution to help the Detroit automakers will be similar to the previous deal the White House reached with congressional leaders.

That plan, which provided loans for GM and Chrysler to help them survive until March 31, was passed by the House last week but blocked by the Senate, mainly by Republican senators, after the United Auto Workers union balked at making additional upfront wage concessions to take effect next year. Ford Motor Co. has said it has enough cash to survive 2009.

1|2

PrintEmail

Write a Comment

Terms

Enter your comments - 3000 characters max

Type in image code

Submit

 Receive China Post promos
 Respond to this email