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US House passes auto bailout

  The House of Representatives approved bailout legislation on Wednesday that would force US automakers to restructure or fail, sending the measure to the Senate where prospects for passage are uncertain.

 

Democrats sought to reclaim momentum in the $14 billion bailout effort, with the bill they negotiated with the Bush administration clearing the chamber by 237-170. “This legislation is about offering Detroit and America a chance to get back on track,” House Speaker Nancy Pelosi said in a floor speech before the vote. “It gets down to a question of tough love.”

The White House weighed in just before the vote with a public endorsement aimed at Republicans skeptical of the rescue and demanding a tougher approach for helping General Motors, Ford Motor, and Chrysler. “We believe the legislation developed in recent days is an effective and responsible approach to deal with troubled automakers and ensure the necessary restructuring occurs,” White House spokeswoman Dana Perino said in a statement.

Democrats advocated passage based on the belief that government inaction could lead to an industry collapse that would cost taxpayers far more than the loans intended to see them through March and help them restructure. While the House stuck to its plan for quick action, uncertainty gripped the Senate where a razor-thin Democratic majority cannot ensure passage. Sixty votes are needed to clear procedural hurdles. A vote could come as early as Thursday, but some Republicans have vowed to slow or even block the legislation. (Reuters)