WASHINGTON — Will $700 billion be enough?

That question emerged Monday as the Bush administration decided to pump more money into insurance giant American International Group and congressional lawmakers pushed to extend the government's rescue to the ailing automobile industry.

The extra money for AIG, part of a major overhaul of the effort to keep the company out of bankruptcy, brings the government's tab to about $150 billion, up from about $123 billion.

In a concession that the previous fix was inadequate, the Treasury Department also said it would spend $40 billion to buy an equity share in the company.

While the additional steps might ease financial stress on that company, they might only feed the demand from others seeking a share of the $700-billion rescue package Congress approved for the financial industry.

"It strengthens the argument of others to say, 'Well, why not us?' " said Gary Schlossberg, senior economist with Wells Capital Management in San Francisco.

He predicted the additional dollars going to AIG would "lower the bar" for requests for government money from outside the financial industry.

The new AIG pledge, coupled with similar aid for banks and other institutions, meant a significant portion of the $700 billion Congress approved for rescuing financial and other companies deemed vital to the economy has been committed. And pressure to widen the scope of such aid is growing as the economy sinks deeper into trouble.

"The money could go quickly," said Daniel J. Ikenson, associate director of the Center for Trade Policy Studies at the Cato Institute, a free-market think tank. "As long as there is a big pot of money sitting here in Washington, every industry is going to ready its lobbyists to get a slice of that pie."

Already, the government has committed $250 billion to purchase direct stakes in banks, and an additional $40 billion from the fund will go to AIG to supplement loan guarantees made before the rescue legislation was passed.

"In the latest sign of pressure to help teetering U.S. auto makers, the entire Michigan congressional delegation wrote to Treasury Secretary Henry Paulson on Monday urging him to authorize "emergency assistance" for the domestic auto industry.

Over the weekend, House Speaker Nancy Pelosi, D-Calif., and Senate Majority Leader Harry Reid, D-Nev., also wrote Paulson, asking him to review the terms of the rescue legislation to determine if automakers qualify.

"A healthy automobile manufacturing sector is essential to the restoration of financial market stability, the overall health of our economy, and the livelihood of the automobile sector's workforce," they wrote.

Congress already has authorized up to $25 billion in government-backed loans for automakers, but with General Motors, Chrysler and Ford staggered by the economic crisis, industry leaders and lawmakers are calling for much more help.

President-elect Barack Obama said Friday that the industry is "the backbone of American manufacturing" and its troubles affect "countless suppliers, small businesses and communities throughout our nation."

Reid believes the $700-billion financial rescue legislation is worded broadly enough to allow help for automakers, spokesman Jim Manley said.

Treasury spokesman Jennifer Zuccarelli said no decisions have been made about automaker eligibility. Although the White House has not embraced aid for automakers, spokeswoman Dana Perino said Monday that it was willing to listen to ideas.

The need to restructure the AIG bailout after less than two months demonstrates the difficulties of such rescue operations curing a continuing credit crunch.

"We have accomplished a great deal in a short period of time. But our work is only beginning," Neel Kashkari, interim assistant Treasury secretary for financial stability, told a securities industry summit in New York.

The original AIG bailout featured an $85-billion emergency line of credit established in September, supplemented by $37.8 billion more early in October. The goal was to stabilize AIG so it could sell assets throughout the financial system and stave off bankruptcy.

But instead of becoming stable, the company fell deeper into trouble. On Monday, AIG reported a third-quarter loss of $24.5 billion.

"They're shooting at a moving target," Ikenson said.

The Treasury Department worked in conjunction with the Federal Reserve Board to retool the AIG bailout "to keep the company strong and facilitate its ability to complete its restructuring process successfully," according to the Fed.

In a complex series of moves, the Treasury will buy $40 billion in newly issued preferred AIG stock, allowing the Federal Reserve to reduce the original $85-billion line of credit to $60 billion.

The Fed also will buy $22.5 billion in residential mortgage-backed securities owned by AIG and another $30 billion in collateralized debt obligations that AIG has insured.

As part of the government's equity stake, AIG must agree to comply with restrictions on executive compensation and "golden parachute" severance packages.