WASHINGTON (AP) -- The Bush administration came to the rescue of the troubled U.S. auto industry Friday, offering $17.4 billion in loans in exchange for concessions from carmakers and their workers.
"Allowing the auto companies to collapse is not a responsible course of action," President Bush said.
He said that a bankruptcy was unlikely to work for the auto industry at this time and would deal "an unacceptably painful blow to hardworking Americans" across the economy.
A senior administration official, speaking on condition of anonymity because of the sensitivity of the issue, said Friday that $13.4 billion in short-term financing will be drawn from the $700 billion Wall Street rescue program, with another $4 billion to be added later.
The firms must use these funds to become financially viable, or lose the taxpayer money.
The official said if the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury.