WASHINGTON, Dec 12: The White House said on Friday that it may tap a $700 billion Wall Street rescue to spare US automakers from an “immediate collapse” that the US economy “could not withstand.”

“Given the current weakened state of the US economy, we will consider other options if necessary -- including use of the TARP programme -- to prevent a collapse of troubled automakers,” spokeswoman Dana Perino said, referring to the Troubled Asset Relief Programme conceived to help financial services firms.

Perino, speaking aboard US President George W. Bush’s official Air Force One jet, declined to say when a decision would come but said the White House understood “the urgency of the situation.”

The “weakened state of the economy is such that it could not withstand a body blow like a disorderly bankruptcy in the auto industry, which would devastate further an already weakened economy,” she told reporters.

The US Treasury Department “will stand ready to prevent an imminent failure until Congress reconvenes and acts to address the long-term viability of the industry,” said spokeswoman Brookly McLaughlin.

Lawmakers are due back on Jan 6, and “addressing our nation’s economic crisis to protect American workers will be one of the first orders of business,” said a spokeswoman for Senate Majority Leader Harry Reid.

US president-elect Barack Obama, who takes office on Jan 20, urged the White House and the Congress to “find a way” to provide urgent aid while forcing “the long-term restructuring that is absolutely required.”

For months, Bush had categorically refused to tap the TARP to save iconic carmakers General Motors and Chrysler, which have warned they may run out of money in weeks. Fellow giant Ford says it does not face the same cash crunch.

The House of Representatives on Wednesday approved a White House-backed bill, crafted by Democrats, to give the ailing automakers a $14 billion injection, but the legislation collapsed in the US Senate.

The measure would have required the manufacturing giants to engage in painful restructuring to ensure their long-term survival and repayment of the government monies or face bankruptcy proceedings.

“Congress spoke last night. They don’t have the votes to do anything.

“They didn’t get it over the goal line, and so we have to consider what other options we would take but I don’t have a timeframe on it,” said Perino.

“While the federal government may need to step in to prevent an immediate failure, the auto companies, their labour unions, and all other stakeholders must be prepared to make the meaningful concessions necessary to become viable,” she warned.

Bush’s Republican Senate allies said the bill failed because of a dispute with US autoworkers unions on the timing of bringing their wages in line with those paid by foreign automakers to non-unionised workers in US states.—AFP