WASHINGTON, DC: President George W Bush is facing increased pressure over the proposed bailout of the US automotive industry from what his 1960s predecessor Lyndon Baines Johnson might have termed "inside the tent", as senior members of his own party urge him to get tough with Chrysler and General Motors.

Following the rejection last week of the Bush-backed bailout bill by the Republican-controlled Senate, members of the party are now demanding that GM and Chrysler be forced to impose wage cuts and debt writedowns before receiving any funding. 

According to observers, Bush is now considering whether to provide the $14 billion (€10.4bn; £9.3bn) "rescue package" via a direct loan from the Treasury, thus circumventing Congress. 

One area of disagreement over the bailout is the imposition of restrictions on labor costs, a move vehemently opposed by trade union body the United Auto Workers.

Republican Senator Bob Corker has spoken out against the provision of a direct loan, and also argues that unless a package can be agreed which makes the auto manufacturers more "competitive", they should be made to file for bankruptcy. 

Says he: "The Bush administration has a historic opportunity over the next few days. The president has to decide: is he still running the White House or is the United Auto Workers?"

Data sourced from Financial Times; additional content by WARC staff