Auto Bailout Appears Halted in Senate as G.O.P. Resists ~ By DAVID M. HERSZENHORN and DAVID E. SANGER

Published: December 11, 2008

WASHINGTON - In a last-ditch effort to revive a government rescue for the American auto industry, Senator Bob Corker, Republican of Tennessee, was trying late Thursday to persuade Senate Democrats to back an alternate plan that would require steep concessions by the United Auto Workers union and by creditors to General Motors and Chrysler.

The majority leader, Senator Harry Reid of Nevada, said on the Senate floor at 5:20 p.m. that a negotiated deal based on Mr. Corker’s proposal was the only hope for a $14 billion in emergency short-term loans for G.M. and Chrysler, which are in danger of financial collapse. Mr. Reid said he hoped that the Senate would vote on Thursday night.

"There’s good faith negotiations going on as we speak," Mr. Reid said in a speech updating senators on the status of the talks. He said negotiators had predicted that they would have some news by 5:30 but he joked that he did not know if that meant 5:30 p.m. or 5:30 a.m. 12 hours later.

"I know people want definite definitions of when all this is going to happen but that’s not how the Senate works," Mr. Reid said.

The prospects of the Senate approving the same auto rescue plan that was passed by the House on Wednesday night evaporated earlier in the day when the Republican leader, Senator Mitch McConnell of Kentucky, gave a floor speech in which he sharply criticized the measure.

Mr. McConnell said his colleagues would not back that plan despite the urgings of the White House, which had negotiated the legislation with Congressional Democrats.

"A lot of struggling Americans are wondering where their bailout is," Mr. McConnell declared. He voiced support of the alternative plan developed by Mr. Corker.

Democrats have indicated that the vote on the auto rescue plan was almost certainly the last major action by the House in this Congress, and they have suggested that if Senate Republicans balk, the Bush administration may have no choice but to find alternative ways to prevent G.M. and Chrysler from collapse.

The Senate delay has some revisiting possibility alternatives for assistance. While there have been suggestions that the administration use some of the $700 billion already approved to bolster the country’s financial system, so far the White House has resisted that idea. And Federal Reserve Chairman Ben S. Bernanke has said the Fed will not get involved.

The House approved the $14 billion plan, negotiated by Congressional Democrats and the White House, on Wednesday night. It would grant emergency short-term loans to General Motors and Chrysler and require the companies to submit to broad government oversight directed by a so-called car czar appointed by President Bush.

Among other things, the alternate plan offered by Mr. Corker calls for giving the holders of bonds issued by the auto companies 30 cents on the dollar to ease the companies’ debt burden; immediately bringing workers’ wages in line with foreign companies like Nissan and Volkswagen; and forcing the United Automobile Workers to eliminate payments to workers after their jobs have been eliminated.

The House vote on Wednesday was 237 to 170, mostly along party lines. Voting in favor were 205 Democrats joined by 32 Republicans mainly from states heavily dependent on the auto industry; 150 Republicans and 20 Democrats voted against it.

The White House renewed its efforts on Thursday to promote a rescue plan. "We believe that the economy is in such a weakened state right now that adding another possible loss of one million jobs is just something our economy cannot sustain at the moment," Dana Perino, President Bush’s chief spokeswoman, said at a news briefing.

Mr. Obama sounded a similar theme.

"I understand people’s anger and frustration at the situation our auto companies find themselves in today," Mr. Obama said at a news conference in Chicago. "I raised concerns about the health of our auto industry a year and a half ago, when I spoke to industry leaders in Detroit. I urged them to act quickly to adopt new technologies and a new business approach that would help them stay competitive in these changing times. And while they’ve failed to move quickly enough toward these goals, at this moment of great challenge for our economy, we cannot simply stand by and watch this industry collapse. Doing so would lead to a devastating ripple effect throughout our economy."

General Motors and Chrysler have said they cannot survive much longer without the federal aid, while the Ford Motor Company, which is in better shape than its competitors, has said it will not seek the emergency loans.

Bill Vlasic contributed reporting from Detroit.