UPDATE 2-House Democrat hopes for deal on US auto bailout
(Adds White House, Paulson, Reid, McConnell comments)
By John Crawley
WASHINGTON, Nov 18 (Reuters) - The U.S. House of Representatives majority leader said on Tuesday he was hopeful a compromise could be reached this week on aid to distressed automakers, but said there may be another opportunity for Congress to enact a rescue this year.
"We're hopeful the Senate can come to an agreement," Maryland Democrat Steny Hoyer told reporters, discussing a brewing impasse on steps to assist General Motors Corp GM.N, Ford Motor Co (F.N), and Chrysler LLC.
Hoyer said "dealing with the auto industry" was a "pressing need" and held out the possibility of lawmakers taking up the issue again in December if it fails to pass a measure during this week's "lame duck" session.
Congress plans an economic summit in early December.
Senate Democrats on Monday proposed a $25 billion bailout, using money from the Treasury Department's $700 billion financial services rescue program approved in October.
Although proponents want the car companies to meet certain conditions in exchange for the funds, so far there has been little broad support for the plan expressed in the Senate.
Aides and lawmakers have said the bill's prospects for passage are slim, a viewed shared by White House officials.
Senate Majority Leader Harry Reid offered no hint on Tuesday of a compromise in the works, saying the proposed bailout remained on track for consideration on Wednesday.
His Republican counterpart, Sen. Mitch McConnell of Kentucky, said he and a number of Republicans support the Bush administration's alternative to amend $25 billion in advanced technology loans approved in September to help automakers retool factories and make more fuel efficient cars.
McConnell believes that is a "sound way to go" and said he was told there was "some Democratic support" for that option.
"We'll be discussing with Senator Reid the best way to go forward," McConnell said.
Democratic leaders have said they do not want to amend the retooling law, saying it is crucial for helping GM, Ford and Chrysler compete once they get back on their feet financially.
Automakers ideally would prefer Congress approve the Senate bailout bill and preserve the retooling loans, which would enable them to access up to $50 billion within the next year.
Chief executives of the automakers are expected to defend their calls for a bailout at a Senate hearing later Tuesday.
While Treasury Secretary Henry Paulson told House lawmakers at a hearing on Tuesday it was not "desirable to have an auto company fail" in the current economy, the Bush administration is convinced the Senate bailout plan is the wrong approach.
White House spokeswoman Dana Perino said there was "no appetite" in the Senate for the Democratic proposal and said the White House would "draw the line" for any compromise at its plan to amend the retooling assistance so automakers could spend the money on surviving their downturn.
"I don't think they could actually even get (their) bill through the process and we are in a situation where we need to move very quickly," Perino said. (Reporting by Donna Smith, Tabassum Zakaria and John Crawley; editing by John Wallace and Tim Dobbyn)
