The Bush administration gave troubled US automakers public reassurances that short-term government help was in the works as a senator who is a major ally of the automotive industry suggested the aid package could reach $15 billion for two companies.
President George W Bush said yesterday the bankruptcy of a domestic car company would undermine the nation's economy as it grapples with a financial meltdown. General Motors Corp and Chrysler LLC have said they could run out of cash within weeks without support from the government.
"An abrupt bankruptcy for autos could be devastating for the economy," Bush told reporters aboard Air Force One during a surprise trip to Iraq and Afghanistan. "We're now in the process of working with the stakeholders on a way forward. We're not quite ready to announce that yet."
In Detroit, Michigan, the heartland of the auto industry, Democratic Sen. Carl Levin said he expects GM to get $8 billion and Chrysler $7 billion under the Bush administration's plan. He said Treasury Secretary Henry Paulson probably would be tapped as a "car czar" to oversee restructuring of the companies.
Bush would not give a precise timetable but said: "This will not be a long process because of the economic fragility of the autos."
Vice President Dick Cheney, in an interview with conservative talk show host Rush Limbaugh, said the auto industry's woes came at an "especially bad time" because of the slowdown of the financial markets.
"We're on the downside of a recession that may be the worst since World War II. And if the automobile industry goes belly up now, there's a deep concern that that would be a major shock to the system," Cheney said.
