Feds Under Pressure to Broaden Bailout

Treasury already needs to ask Congress for next $350B installment
By Clay Dillow,  Newser Staff
Posted Nov 11, 2008 9:45 AM CST
General Motors Corp. said Friday it lost $2.5 billion in the third quarter and warned that it could run out of cash in 2009.   (AP Photo)
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(Newser) – With nearly half of the $700 billion bailout committed, a growing array of distressed companies is lobbying the government, the Wall Street Journal reports, increasing the likelihood the Treasury will ask Congress for the rest of the bailout cash soon. But varied interests among legislators and emerging unemployment risks could turn up the pressure to spread those funds beyond financial firms.

The bailout is “evolving in ways that I don’t think anyone anticipated,” one analyst said. “Things are just hitting them from every single direction, every day, and I don’t think they know whether to spit or go blind.” AIG’s second bailout, coupled with General Motors’ gloomy warnings, increase the chances federal money will find its way outside the banking sector.