The White House Monday reiterated that additional Congressional measures will be needed for the government to provide more support for struggling U.S. automakers.
Press Secretary Dana Perino said that help for automakers had not been a part of discussion when Congress was working to pass the $700 billion financial rescue package.
As a result, she said, it would not be appropriate for the administration to unilaterally shift funds from the financial sector to the automotive industry.
"There was not discussion of specific help to auto companies during that debate, and so the Congress's intent was to help financial institutions," Perino said.
Perino's statement comes in the wake of the administration easing the terms of a bailout package for insurance giant American International Group (AIG) and a letter over the weekend from Speaker of the House Nancy Pelosi, D-Calif., and Senate Majority Leader Harry Reid, D-Nev., urging the Treasury Department to consider using the financial rescue funds to help automakers.
In the letter Reid and Pelosi argued that the legislation had given Treasury broad discretion to allocate funds in a way to best support the economy.
"Congress granted you broad discretion to purchase, or make commitments to purchase, financial instruments you determine necessary to restore financial market stability," they wrote.
"A healthy automobile manufacturing sector is essential to the restoration of financial market stability, the overall health of our economy, and the livelihood of the automobile sector's workforce," the letter continued.
However Perino said that the letter was not indicative of the intent of Congress when it passed the financial bailout package.
And while the Energy Department is now accepting applications for federally-backed loans to help automakers and their suppliers retool for more environmentally friendly vehicles, Perino said that was the limit of the administration's ability to support the industry.
"Congress is going to come back into town next week. If they decide to try to do something more on the auto industry we would listen to them," Perino said. "We have to move forward with what we can do with the statutes that Congress has authorized us to put forward."
The Treasury Department announced Monday morning a plan to buy a $40 billion stake in AIG after the company posted a $24 billion loss for the third quarter, bringing the total federal investment in AIG to roughly $150 billion.
"Together with steps taken by the Federal Reserve, this restructuring will improve the ability of the firm to execute its asset disposition plan in an orderly manner," the Treasury Department said in a statement.
Perino reiterated that the federal intervention to prop up AIG was necessary to prevent further damage to the broader economy, according to Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke.
"AIG is a large, interconnected firm. Both Secretary Paulson and Chairman Bernanke have determined that a failure by the firm would cause damage to our financial system, the U.S. economy, and the global economy," Perino said. "AIG being clearly within that financial service sector is what Congress had in mind when it passed the rescue package."
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.