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Congress, Bush reach for deal on automaker bailout
WASHINGTON -- Amid fresh assembly line layoffs, congressional Democrats and the White House reached for agreement Friday on about $15 billion in bailout loans for the beleaguered auto industry. President Bush warned that at least one of the Big Three carmakers might not survive the current economic crisis.
Several officials in both parties said a key breakthrough on the long-stalled bailout came when House Speaker Nancy Pelosi bowed to Bush's demand that the aid come from a fund set aside for the production of environmentally friendlier cars. The California Democrat spoke to White House chief of staff Josh Bolten during the day to signal her change in position, they added.
The developments came as desperate auto executives pleaded for a second straight day with lawmakers for loans to help them survive, and the government reported the worst single month's job loss in 34 years.
Pelosi's office issued a statement saying legislation would come to a vote in the House next week. The Senate is also scheduled to be in session to consider steps to aid Detroit's Big Three.
"Congress will insist that any legislation include rigorous and ongoing oversight to guarantee that taxpayers are protected and that resources are directed to ensure the long-term viability and competitiveness of the American automobile industry," Pelosi's statement said.
It did not say so, but numerous officials confirmed that she had bowed to Bush on the point that had blocked agreement for weeks.
Officials in both parties also said the legislation would include creation of a trustee or group of industry overseers to make sure the bailout funds were used to transform General Motors Corp., Ford Motor Co. and Chrysler LLC into competitive enterprises.
Bush declared the economy was in a recession, and he urged a gridlocked Congress to act quickly on a multibillion-dollar industry bailout with taxpayer protections.
Republicans said there had been no lessening in Bush's refusal to tap the $700 billion financial industry bailout fund to help the automakers.