As Detroit Teeters Near Bankruptcy, John McCain Says Automakers Should Wait for Additional Government Help

Meanwhile, General Motors and Chrysler have been in merger talks, and financial analysts are beginning to comment that the companies could run out of money by mid-to-late 2009 without outside help. Spokespeople for both companies, quoted by The Wall Street Journal today, had the same categorical statement: "Bankruptcy is not an option." The paper says both companies reportedly have talked to the federal government about the merger talks and adds that Michigan political delegations and the automakers have asked for federal cash help with the merger — including the suggestion that the government tap its Troubled Asset Relief Program (TARP) to help make the costly merger process work.

Another possibility, said the paper, quoting "people familiar with the GM-Chrysler talks," would be starting a new entity that would include a third company. Chrysler is owned by Cerberus Capital Management, which has been talking with the Renault-Nissan alliance in recent weeks.

On Sunday's TV broadcast, McCain took a cautious angle on the problem. The candidate said he believes the government should "get the first $25 billion to them first" and "see how that works" before agreeing to further bailout money for the auto companies. Robert Rubin, a former secretary of the treasury who advises the Obama campaign, said on Sunday's Face the Nation broadcast that he believes the government should "see if there are ways that public policy can be helpful and make sense" of the auto industry's dilemma.

Inside Line says: Another deeply troubling issue for the next president to take charge of. — Laura Sky Brown, Correspondent