The $700 billion Troubled Asset Relief Program (TARP) was passed last month... so why is the debate over the bailout still raging?

Well, technically, the measure was intended to provide relief to ailing financial institutions. But now another industry — automakers — is pointing out that they, too, are suffering due to the faltering economy. And, just as the argument went with the bailout of the banks, many in Congress argue that if huge American automakers like GM, Ford, and Chrysler become insolvent, the consequences for the rest of the American economy could be disastrous.

One prominent think tank, the Center for Automotive Research (CAR), is pushing hard for some of the $700 billion TARP funds to go to automakers. CAR's November 5 press release stated that "the economic impact of a full or partial contraction of the Detroit Three on the United States economy" would create a "ripple effect [which] will impact suppliers, international manufacturers and the entire U.S. automotive industry." CAR predicts the failure of GM, Chrysler, and Ford would cause the loss of nearly 3 million American jobs within one year. The prospect is particularly alarming considering that the unemployment rate in October was the highest we've seen in the past 14 years — and the layoffs continue.

In the 110th Congress's final session, Democrats were scrambling for Republican support to get a Wednesday vote on the auto bailout. And, as CNN reports, there's some indication of bipartisan cooperation — Sen. George Voinovich (R-Ohio) and Sen. Carl Levin (D-Michigan) are together circulating a letter to garner support for the auto industry bailout.

But, according to the CNN report, the auto bailout is far from a done deal. The Bush administration, senior congressmen, and much of the American public strongly oppose using TARP funds to aid the auto industry. They say it's a waste of taxpayer dollars to support the poor management that got the companies in this position in the first place.

Bush and Republican leaders in Congress have suggested a possible alternative to using TARP funds: loosening up the restrictions placed on the $25 billion in loans to the auto industry Congress previously earmarked for developing fuel-efficient cars. President-elect Obama appears similarly hesitant to endorse a full-blown bailout. On CBS's 60 Minutes, Obama admitted that something should be done to assist the auto companies, but the government should stop short of handing them a "blank check" to access the TARP funds.

The prospect of more layoffs when many Americans are already hurting financially is likely to stir up some support for helping out the car companies. But it's unclear whether the fear of layoffs will be able to overcome all the concerns that made TARP so difficult to pass in the first place.

-- Vanessa Durante