White House Reconsiders, Says Will Help Big 3

Washington, DC, Dec. 12, 2008--The Treasury Department said Friday that it would step in and lend funds to the Big 3 auto-makers until Congress has time to consider a long-term rescue package next year.

Talks on a rescue package broke down in the Senate late on Thursday night, making action on a bailout impossible until next year.

"Because Congress failed to act, we will stand ready to prevent an imminent failure until Congress reconvenes and acts to address the long-term viability of the industry," Treasury spokeswoman Brooklyn McLaughlin said in a statement.

Funds for the auto companies are likely to come from the Trouble Asset Relief plan. The decision to use TARP funds is a shift in the previous White House position that the $700 billion dollars should be limited to stabilizing the financial sector.