November 11th, 2008
03:03 PM ET
6 years ago

Sources: Obama pressed Bush for auto industry bailout

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Obama and President Bush wave to reporters as they head into the Oval Office on Monday.
Obama and President Bush wave to reporters as they head into the Oval Office on Monday.

(CNN) – At their private Oval Office meeting on Monday, President-elect Barack Obama urged President Bush to support billions of dollars in aid for the struggling auto industry during the upcoming lame-duck session of Congress, according to three officials briefed on the meeting.

The officials said Bush privately expressed skepticism about taxpayer money for automakers on the heels of a string of government bailouts for other industries, and the president also urged Obama to help push through a free trade pact with Colombia – a key legacy item for the outgoing administration that is facing stiff resistance from Democrats on Capitol Hill.

But a senior Bush administration official seemed to downplay suggestions that Bush was offering a quid pro quo by saying the White House still believes the trade deal “deserves to pass on its own merits” without being linked to anything else.

The officials familiar with the meeting said Obama made the case that dramatic action needs to be taken this year – rather than after he is sworn into office – because the Big Three U.S. automakers are bleeding cash at an alarming rate.

One of the officials noted that about one in ten jobs in America are tied to the auto industry, and if one of the companies goes bankrupt it could have a massive spillover effect into the credit industry and other sectors. “The numbers are so staggering,” said the official. “It’s a huge piece of the financial fabric of the country.”

The senior Bush administration official said the White House is “open to ideas from Congress to accelerate funds they’ve already appropriated” to help the auto industry.

But the administration official said support would come “as long as funding will continue to go to viable firms and with strong taxpayer protections” linked to the auto industry aid.

An official in the auto industry told CNN that bringing the Colombian pact into the negotiations could be a poison pill that prevents passage of an auto industry package. But a senior Democratic aide suggested Congress may be willing to call Bush’s bluff and try to pass an auto industry aid package without the trade deal.

The senior aide said Democrats do not believe “this president wants to add the demise of GM to his legacy list.”