US in a new push for auto bail out

The US authorities are stepping up efforts to agree a deal worth billions of dollars to bail out the country's three big carmakers.

Congress and the White House will hold talks over the weekend on a deal after two days of Congressional hearings.

A White House spokesman said progress was expected, and House Speaker Nancy Pelosi said she wanted a vote on the package next week.

Her comments followed news of huge job losses in the US in November.

In a dramatic indication of the worsening economic situation, the unemployment rate rose to a 15-year high of 6.7% from 6.5% in October, with more than 533,000 jobs lost.

President-elect Barack Obama has called for urgent measures to stimulate the economy and get people back to work.

"There are no quick or easy fixes to this crisis...and it's likely to get worse before it gets better," he said in response to the announcement.

Hope of progress

Bosses from the three big car companies, General Motors, Ford and Chrysler, appeared before two Congressional committees pleading for $34bn (£23bn) to prevent collapse.

The car manufacturers have warned that the collapse of any one of them would have disastrous effects on the whole US economy.

But there has been considerable opposition to a bailout plan - critics say the car manufacturers need to first show they can be more efficient.

But politicians who back the plans say to do nothing would be a disaster.

Late on Friday, White House spokesman Anthony Warren said: "We continue to talk with Congress and we hope to make progress this weekend."

The Democratic Senate majority leader, Harry Reid, said that support and co-operation from Republicans would determine when a vote would happen and whether it will succeed.

President George W Bush earlier said he wanted Congress to act next week on a rescue plan for the car industry by modifying a $25bn fund which was set up to promote fuel-efficient technologies.

Congressional Democrats have opposed this move and insisted the money should come from the bank rescue fund, known as the Troubled Asset Relief Programme (TARP).

But Ms Pelosi appeared to suggest that the $25bn fund could be used under certain conditions.

"We will not permit any funds to be borrowed from the advanced technology programme unless there is a guarantee that those funds will be replenished in a matter of weeks so as not to delay that crucial initiative," she said.

"Regardless of the source, all funding needs will be tightly targeted with vigorous supervision and guaranteed taxpayer protection."

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