Obama asks Bush for help for U.S. auto industry

Reuters is reporting U.S. President-elect Barack Obama urged President George W. Bush to pass a second stimulus package to help the U.S. economy and asked him to use existing bailout measures to help the ailing auto industry, an aide said.

A spokeswoman for Obama said the president-elect raised the issue in his meeting with Bush at the White House on Monday.

Spokesman Robert Gibbs said on the plane back from Washington after the meeting, Obama and Bush had discussed the “broad health” of the auto industry but the newly elected president did not specifically ask for help for one single American automaker.

“Obama asked for a second stimulus and to use existing measures to help the auto industry,” an aide said on Tuesday but gave no further details on what measures were available currently to help the carmakers or the specific provisions of a new economic stimulus plan.

The U.S. auto industry has asked for up to US$25 billion in emergency loans in order to prevent the industry’s collapse. U.S. auto sales are plunging and General Motors Corp, Chrysler LLC and Ford Motor Co, are burning through billions of dollars of cash monthly.

Obama has acknowledged the gravity of the situation with the automakers and said last in a news conference on Friday that federal help for the distressed industry is a high priority of his transition team.

Top congressional Democrats asked Treasury Secretary Henry Paulson in a letter on Saturday to consider aid to the automakers through the financial bailout initiative that has so far covered banks and other financial services companies.

The Bush administration has not dismissed outright the possibility of extending emergency assistance to the automakers.

But public and private statements from administration officials indicated more clearly on Monday that they believe any new and substantial money for manufacturers would require legislative action.