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Auto Bailout Fails in Senate; White House Considering Intervention

A proposal to provide $14 billion in emergency federal loans for the U.S. auto industry collapsed in the Senate last night, as lawmakers could not secure the necessary 60 votes to move the legislation forward. However, the Associated Press (AP) reports that President George W. Bush will consider using money from the Wall Street bailout fund to prevent the industry from collapsing. "The current weakened state of the economy is such that it could not withstand a body blow like a disorderly bankruptcy in the auto industry," says Dana Perino, White House press secretary, quoted by the AP. Approximately $15 billion of the first half of the $700 billion financial industry bailout remains uncommitted; in order to tap into the second half of the $700 billion, the president would have to notify Congress, which could block it or put new conditions on how it is used. Perino declined to say when a decision might be made.

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