En route to Afghanistan from Iraq in a series of unannounced visits Bush told reporters aboard Air Force One, "We're not quite ready to announce that yet," according to a Reuters report. There remains some doubt as to whether the President intends to use the funds for the the auto industry at all, with Bush saying only, "that's a possibility."
Following the rejection of the auto industry bailout bill by the Senate, the onus had once against fallen on the administration to take action. The White House then proposed tapping the financial rescue fund known as the Troubled Assets Relief Program (TARP) to support the auto industry. Currently, the first $350 billion in the fund approved for the Wall Street rescue has around $15 billion in funds that are not earmarked for a specific function - yet.
White House Press Secretary Dana Perino stated that "under normal economic conditions we would prefer that markets determine the ultimate fate of private firms. However, given the current weakened state of the U.S. economy, we will consider other options if necessary - including use of the TARP program - to prevent a collapse of troubled automakers. A precipitous collapse of this industry would have a severe impact on our economy, and it would be irresponsible to further weaken and destabilize our economy at this time."
However using the TARP funds will require a new bill to be put through Congress, which could be shot down again by the Senate. Nevertheless, time is running out for GM and Chrysler, and this has also prompted members of the Michigan legislature to send a joint letter to the White House requesting help. The letter states that not helping the auto industry "will plunge our nation further into recession, add hundreds of thousands to the employment rolls in a matter of weeks, and deliver a crippling blow to the manufacturing sector from which it may never recover. Other nations are acting to assist their automotive industries and the U.S. must do the same."
The letter also observed that the "Department of Treasury and the Federal Reserve have existing authorities they can use to give this vital industry access to the capital it needs to survive this recession, a position that was supported by Gene L. Dodaro, the Acting Comptroller General of the United States."
While the Bush administration ponders the use of TARP funds to help the automotive industry, political commentators are remarking that this could be one of the most crucial decisions in the Bush administration's legacy when all is said and done. With nothing set in stone, however, the automakers must sweat it out until a decision is made.
