By DAVID M. HERSZENHORN
WASHINGTON — The prospects of a government rescue for the foundering American automakers dwindled Thursday as Democratic Congressional leaders conceded that they would face potentially insurmountable Republican opposition during a lame-duck session next week.
At the same time, hope among many Democrats on Capitol Hill for an aggressive economic stimulus measure all but evaporated. Democratic leaders have been calling for a package that would include help for the auto companies as well as new spending on public works projects, an extension of jobless benefits, increased food stamps and aid to states for rising Medicaid expenses.
But while Democrats said the stimulus measure would wait until President-elect Barack Obama takes office in January, some industry experts fear that one of the Big Three automakers will collapse before then, with potentially devastating consequences.
Despite hardening opposition at the White House and among Republicans on Capitol Hill, the Democrats said they would press ahead with efforts to provide $25 billion in emergency aid for the automakers. But they said the bill would need to be approved first in the Senate, which some Democrats said was highly unlikely.
Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the banking committee, said he did not believe there would be enough Republican support to get the 60 votes needed to move a bill forward. “Right now, I don’t think there are the votes,” he said, adding that he personally favored aid for the automakers.
As the outlook for an auto industry bailout dimmed, President Bush traveled to Wall Street, where he gave a robust defense of capitalism and seemed to warn world leaders — and the incoming Obama administration — not to draw the wrong lessons from the global economic crisis by over-regulating markets and hindering free trade.
The White House, in resisting calls for aiding the automakers, has also warned repeatedly against throwing taxpayer money at companies that may not be salvageable.
Acknowledging the Bush administration’s opposition, Mr. Dodd said Democrats had to keep in mind that the Treasury Department already has some authority to help the finance arms of the auto companies but has been reluctant to use it.
“I want to be careful about bringing up a proposition that might fail in light of the fact the authority exists, and under an Obama administration there seems to be a greater willingness to deal with the issue,” Mr. Dodd said. “So there are some political considerations to be made.”
Passing any legislation to aid the auto companies would require 60 votes in the Senate. Democrats now control 51 of those votes, but Mr. Obama has said he will resign his Senate seat on Sunday, and Vice President-elect Joseph R. Biden Jr. is not expected to attend the lame duck session, meaning Democrats would need the support of at least 11 Republicans.
With Mr. Bush still wielding his veto authority, the fate of any legislation without White House support would be uncertain.
The auto companies, however, remained hopeful and said they would send top executives to Congressional hearings next week to make their case.
“We hope all parties recognize there’s a pressing need to preserve the domestic auto industry and the jobs and nation’s competitiveness that’s tied to the industry,” said Greg Martin, a spokesman for General Motors. “We’re ready and willing to work with all members of Congress to get this assistance.”
The majority leader, Senator Harry Reid of Nevada, and House Speaker Nancy Pelosi have urged the Bush administration to help the automakers and said they were prepared to try to push through legislation if the White House refused to act.
Mr. Reid, on Thursday, said that he would open a lame-duck session in the Senate on Monday, hoping to move forward with legislation that would extend unemployment benefits and to attach an amendment providing aid for the auto companies.
Aides to Ms. Pelosi said the House would be brought back into session as of 1 p.m. Wednesday and would remain on standby, awaiting action by the Senate.
Representative Barney Frank, Democrat of Massachusetts and chairman of the House Financial Services Committee, is working on a measure that would direct $25 billion to the carmakers from the $700 billion financial bailout fund. Aides said Mr. Frank was collaborating with his Democratic colleagues in the Senate.
President Bush, however, has not signaled any willingness to tap the bailout fund, which the Treasury has said is money better spent on financial institutions. And some powerful Republican lawmakers have voiced strong opposition to government aid for the automakers.
Senator Richard C. Shelby of Alabama, the senior Republican on the banking committee, said he would not support legislation to aid the auto companies and seemed prepared to let one or all of them collapse.
“The financial straits that the Big Three find themselves in is not the product of our current economic downturn, but instead is the legacy of the uncompetitive structure of its manufacturing and labor force,” Mr. Shelby said in a statement. “The financial situation facing the Big Three is not a national problem but their problem.”
On Thursday, Representative John A. Boehner of Ohio, the Republican leader, also came out strongly against the idea.
“Spending billions of additional federal tax dollars with no promises to reform the root causes crippling automakers’ competitiveness around the world is neither fair to taxpayers nor sound fiscal policy,” Mr. Boehner said in a statement.
Representative Jeb Hensarling of Texas, chairman of the conservative Republican Study Committee, in an appearance on Fox News, said: “You wonder where bailout-mania will end.”
Mr. Hensarling said American automakers should bear responsibility for their failed operations. “They are producing high-cost products that consumers don’t want to buy. And so now we have Washington on the verge of giving them a bailout simply because we have all heard of them and they have high-priced lobbyists.”
The Senate Republican leader, Mitch McConnell of Kentucky, has expressed support for expediting $25 billion in loans for the auto companies that Congress approved in September. But he has not indicated any willingness to provide additional money or to use money from the financial bailout fund for the car makers.
“Earlier this year, Congress acted in a bipartisan way to help the auto industry and protect jobs,” said Don Stewart, a spokesman for Mr. McConnell. “The Congress passed and the president signed legislation authorizing $25 billion in low-interest loans to help American automakers retool their facilities to make the fuel-efficient cars of the future. It may be that there are changes that need to be made in order to expedite these low-interest loans.”
Mr. Stewart added: “Other ideas have been floated, and all will receive a review as we approach the Senate’s return next week.”
Ms. Pelosi so far has rejected the idea of easing restrictions on those loans, which require carmakers to develop technologies that will improve fuel efficiency. But Mr. McConnell’s suggestion, also encouraged by the White House, may be the only potential compromise and one Republicans could support because it does not require a new appropriation of federal funds.
Some Republicans also suggested that there was less support among rank-and-file Democrats for an auto bailout than party leaders were letting on.
One Republican, Senator George V. Voinovich of Ohio, whose state relies heavily on the auto industry, voiced strong support on Thursday for using bailout money to help the failing car companies. Mr. Voinovich was working with Senators Carl Levin and Debbie Stabenow, Democrats of Michigan, to drum up support for such a plan.
Mr. Levin met Thursday afternoon with Mr. Reid in the majority leader’s office to map out their strategy.
Complicating the effort to aid the carmakers is the ownership structure of Chrysler, a limited partnership controlled by Cerberus Capital Management, a private equity firm. The firm said it would give up any profits from a future sale of the company in exchange for financial assistance from the government, hoping to limit political opposition in Washington to aid for a privately held company, according to Bloomberg News.
The shaky support for an auto industry bailout in general had left Ms. Pelosi uncertain about whether calling the House back into session would be worth the trouble.
Jim Manley, a senior adviser to Mr. Reid, said there was no chance of approving help for the auto companies without broad support from across the aisle. “We cannot do it without the support of Senate Republicans, who I hope will join us to pass a bill that saves the jobs and protects the livelihoods of millions of hard-working Americans,” Mr. Manley said.
Carl Hulse contributed reporting from Washington, and Bill Vlasic from Detroit.
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