Questions Surround Auto Industry Aid

"The congressman believes all options should be on the table," said Michael Robbins, Dingell's chief of staff . "It's really up to the companies to decide what is best for them."

Knollenberg spokesman Nate Bailey said that while Knollenberg had worked on both the $25 billion loan program and TARP, "beyond that, Congressman Knollenberg is open to discussing with them whatever they view as necessary to protect their jobs and to keep the companies afloat."

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Some critics have railed against any government intervention in the auto industry, arguing that the automakers' troubles were of their own making. Auto industry supporters, meanwhile, claim that the automakers aren't entirely to blame, saying everything from health care costs to trade agreements have left U.S. automakers less competitive than their foreign rivals.

Meanwhile, attitudes of lawmakers once resistant to government auto industry intervention are changing, said John Casesa, a longtime auto analyst and a managing partner of Casesa Shapiro Group LLC.

"Whereas three months ago, they would have said, 'You made your bed, now sleep in it,' they are willing to look past that and say, 'Can we do this for the good of the country?'" Casesa said.

Cole said that, at this point, the government can't afford not to step in. If a major U.S. automaker fails, he said, job losses at auto assembly plants, parts manufacturing plants and other businesses could total as many as 2 million.

"It has the potential of escalating to being a very serious problem," Cole said. "It's kind of like the old saying: 'An ounce of prevention equals a pound of cure.'"