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 George W. Bush warned that at least one of the Big Three carmakers might not survive the current economic crisis.
Several officials said House Speaker Nancy Pelosi of California and White House Chief of Staff Josh Bolten spoke by phone. While no details of their conversation were available, it appeared the House's top Democrat had dropped her opposition to Bush's insistence that the aid come from a fund set aside for the production of environmentally friendlier cars.
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 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.
At the White House, 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.
"We are going to have to have some give here," replied Massachusetts Rep. Barney Frank, a senior House Democrat, expressing optimism that compromise might be possible. It wasn't clear whether he was prodding Bush or Pelosi — who have disagreed sharply on the terms of any bailout — or both.
Republicans said there had been no lessening in Bush's refusal to tap the $700 billion financial industry bailout fund to help the automakers