WASHINGTON — The Bush administration is looking at “orderly” bankruptcy as a possible way to deal with the desperately ailing U.S. auto industry, the White House said Thursday as carmakers readied more plant closings and a half-million new jobless claims underscored the deteriorating economy.
With General Motors, Chrysler and the rest of Detroit eagerly awaiting a White House decision on billions of dollars in emergency federal loans, press secretary Dana Perino said it wasn’t a choice between government rescue and the collapse of a major industry.
“There’s an orderly way to do bankruptcies that provides for more of a soft landing,” she said. “I think that’s what we would be talking about.”
President George W. Bush, asked about an auto bailout, said he hadn’t decided what to do but didn’t want to leave a mess for Barack Obama, who takes office a month from Saturday. A White House decision on helping the automakers could come as early as today.
Bush, like Perino, spoke of the idea of bankruptcies orchestrated by the federal government as a possible way to go, without committing to it.
“Under normal circumstances, no question bankruptcy court is the best way to work through credit and debt and restructuring,” he said at the American Enterprise Institute, a conservative Washington think tank.
The Big Three automakers said anew that bankruptcy wasn’t the answer, as did an official of the United Auto Workers who called the idea unworkable and even dangerous. GM said a report that it and Chrysler had restarted talks to combine was untrue.
