White House Slams Door on More Aid to Detroit

Posted November 18, 2008 at 11:34am

The White House on Tuesday all but ruled out agreeing to any additional money for U.S. automakers beyond $25 billion in loans previously granted to the industry, rejecting Democratic efforts to allot another $25 billion in funds to the car industry from the $700 billion financial company bailout kitty passed this fall.

“We’re going to just draw the line at $25 billion already appropriated” for the auto industry, White House Press Secretary Dana Perino said.

The $25 billion was originally granted to help automakers produce more fuel-efficient cars, but the White House wants to change the rules governing the loan to free it up for other purposes. The Bush administration has argued that it was never the intent of Congress for the $700 billion to be used for other industries, and that giving some of it to the automakers would stir demand from other industries.

Perino also emphasized repeatedly that President George W. Bush wants any changes to the funding for automakers to be contingent on the companies showing that they can make themselves viable, charging the Democratic proposal would not do this.

Perino said the White House does not believe there is support in the Senate for carving new funds for carmakers out of the financial system rescue package.