Obama bats for ailing auto industry in talks with Bush

NEW YORK: President-elect Barack Obama, who has described the US auto industry as the "backbone of American manufacturing" has asked President George W Bush to initiate an immediate rescue package for the ailing sector during their first meeting at the White House.
    
"Obama went into his post-election meeting with Bush on Monday primed to urge him to support emergency aid to the auto industry," advisers to the first-ever black-American president-elect was quoted as saying by the New York Times.
    
But Bush indicated at the meeting, held without aides, that he might support some aid and a broader economic stimulus package if Obama and Congressional Democrats dropped their opposition to a free-trade agreement with Colombia, a measure for which Bush has long fought, the influential newspaper quoted people familiar with the discussion as saying.
    
US labour unions oppose the FTA deal with Colombia citing numerous murders of trade unionists in the South American nation by right-wing paramilitary squads who, critics say, are often closely linked to the Colombian armed forces.
   
The Bush administration has balked at allowing the automakers to tap into the USD 700 billion bailout fund, despite warnings last week that General Motors, the world's No.1 automaker, might not survive the year.
    
But Democrats also indicate that neither Obama nor Congressional leaders are inclined to concede the Colombia pact to Bush, and may decide to wait until the senator from Illinois assumes power on January 20 next, the paper said.

Separate from his differences with Bush, Obama has signalled to the automakers and the unions that his support for short-term aid now, and long-term assistance once he takes office,is contingent on their willingness to agree to transform their industry to make cleaner, more energy-efficient vehicles.
    
At his first post-election press conference in Chicago on November 7, Obama had singled out the ailing auto industry and highlighted its plight following the economic crisis.
    
"The news coming out of the auto industry this week reminds us of the hardship it faces, hardship that goes far beyond individual auto companies to the countless suppliers, small businesses and communities throughout our nation who depend on a vibrant American auto industry.
    
"The auto industry is the backbone of American manufacturing and a critical part of our attempt to reduce our dependence on foreign oil," Obama had said.
    
As the auto industry reels, rarely has an issue so quickly illustrated the differences from one White House occupant to the next, the paper said.
    
"How Mr Obama responds to the industry's dire straits will indicate how much government intervention in the private sector he is willing to tolerate. It will also offer hints of how he will approach his job under pressure, testing the limits of his conciliation toward the opposition party and his willingness to stand up to the interest groups in his own," the Times said.
    
General Motors reported a USD 2.5 billion net loss for the third quarter last week.
    
The major US automakers - GM, Ford and Chrysler - are each using up their cash at unsustainable rates. The Center for Automotive Research, which is based in Michigan and supported by the industry, released an economic analysis of the impact of one or all of them failing.
    
It said if the 'Big Three' were to collapse, it would cost at least three million jobs, counting autoworkers, suppliers and other businesses dependent on the companies, down to the hot-dog vendors and bartenders next door to the plants.