Aides: Obama Suggested More Aid For Auto Companies

By: AP
By: AP

WASHINGTON – President-elect Obama suggested to President Bush that the administration immediately provide extra help to struggling U.S. automakers, aides to the Democrat say, in their first face-to-face meeting since Election Day.

Obama's aides said the president-elect brought up the issue with Bush during their two-hour White House talks on Monday, expressing his view that action is needed now, not just to help the U.S. companies but also the broader economy, because of their enormous reach. Obama raised the idea of an administration point person on autos with a portfolio aimed at improving the long-term health of the companies.

Bush repeated his position, recently stated by staff, that he is open to helping the automakers.

Also, amid discussions over whether new economic stimulus spending is needed, Obama focused on his desire for it while Bush stressed that his main priority for any postelection action out of Congress is approval of a long-stalled free trade agreement with Colombia, said people familiar with the conversation between the two men. The sources declined to be named publicly because of the private nature of the talks.

Reflecting the delicate dance of a meeting between outgoing and incoming presidents — one still in charge and one about to be — neither man made the kind of direct requests of nor dealmaking commitments to the other that could violate unspoken protocols covering the transfer of power in American history. However, each made sure the other knew what they want.

"In no way did the president suggest that there was a quid pro quo," said White House press secretary Dana Perino. But, she added, "he did talk about the merits of free trade."

The Illinois senator's spokesman, Robert Gibbs, said only that the discussion involved "the broad health of the industry" and was not just limited to any one of the three largest car makers.

Perino said Bush described the meeting as "constructive, relaxed and friendly," covering problems at home and abroad and his personally pledge for a smooth transition.

There clearly is momentum building for some new aid to automakers.

In September, Congress approved $25 billion in loans to automakers to help them retool plans to build more fuel-efficient vehicles, and thus become more solid and profitable competitors in the global marketplace. Though the administration is working to give automakers quick access to that money, it still would likely not come fast enough — or in big enough amounts — to satisfy the drowning companies.

Over the weekend, House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid asked the administration to consider expanding the $700 billion bailout for financial firms to include car companies. The administration has concluded the law doesn't allow automakers to be eligible under the main, stock-purchase part of the program.

"We don't see anything in there that would give us the authority to help individual industries," Perino said Tuesday. "We have gone as far as we can with the authority given us."

At a news conference last Friday, Obama called automakers "the backbone of American manufacturing" and said he hoped the administration would "do everything it can to accelerate the retooling assistance." Perino said Monday it was open to that, and would listen to lawmakers' ideas for making more loans available or for clarifying the bailout law to make clear that other industries beyond banks qualify.

The debate comes as General Motors, Ford and Chrysler are burning through cash and bleeding jobs. Analysts are predicting that G.M., in particular, might not last the year without a government bailout.


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