Bush may ask to tap rest of bailout next week

The Bush administration is considering telling Congress as early as next week that it wants to tap the unused USD 350 billion of the financial industry bailout, officials said on the heels of more dismal economic news.

They yesterday said White House Chief of Staff Josh Bolten and House Speaker Nancy Pelosi discussed the issue earlier in the day in a telephone conversation that also touched on a possible bailout of the auto industry.

Tony Fratto, a White House spokesman, said, "No decision has been made to request the second instalment. I can't speculate what may or may not happen next week, but no decision at this time."

But another Republican said the chances were greater than 50-50.

It was not immediately clear, however, how the administration might use the additional money.

The officials spoke on condition of anonymity because they were not authorised to disclose any developments.

Any administration decision to tap the remaining USD 350 billion would go into effect unless both houses of Congress disapprove by a two-thirds vote within a fixed time limit, but such a move nevertheless would almost certainly prompt Capitol Hill critics of the bailout to try to block use of the funds.

In an unusual development, Democrats said President-elect Barack Obama has offered to allow his aides to participate in talks over possible uses of the money.