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WASHINGTON -- A change of direction late this afternoon by the U.S. White House could ease the political stalemate over emergency aid to the Detroit 3.

The White House is recommending that Congress revise a $25 billion loan program already on the books for automakers, rather than try to carve another $25 billion out of $700 billion set aside for rescue of the nation's financial system, according to published reports.

White House Press Secretary Dana Perino told reporters of the change, according to the Associated Press and Dow Jones.

Senate Majority Leader Harry Reid, Democrat-Nevada, quickly labeled the offer unacceptable. But it could offer an alternative when debate gets under way in Congress next week on a new loan package.

In September, Congress and the White House approved the first $25 billion in industry loans to fund retooling of plants for more fuel-efficient vehicles. Automakers have argued that the money would come too late and with too many restrictions to ease their urgent cash crisis.

The Bush administration now supports removing restrictions on use of the fuel-economy loans so they can be used for a variety of purposes, published reports said.

The White House and some Republicans in Congress have resisted plans to designate some of the financial rescue money for automakers. Democratic leaders in Congress plan to take up bills that would do just that next week.