Granholm said she would back federal aid for a merger of General Motors Corp. and Chrysler LLC if it comes to that. The letter indicates no conditions about job loss. 'There will be job loss' under a merger... 'but the alternative is worse,' Granholm told reporters after a news conference on Proposal 2 stem cell research. She said the question is, 'can we as a state support a smaller auto industry but a healthier industry.' The letter states that the U.S. automakers directly employ 355,000 workers and another 4.5 million Americans work in sectors supported by the domestic automakers. 'Because most new vehicles sold to consumers in the United States have been purchased with financing, the current freeze in the credit markets has resulted in a situation where consumers cannot make new purchase and vehicle sales fall,' the letter says. 'The auto industry; their network of suppliers, vendors, dealers and other businesses and the communities that rely on those businesses face unimaginable challenges -- challenges we urge you to help address.' During the news conference on the ballot proposal, Granholm called the opposition campaign to embryonic stem cell research 'deceitful,' adding: 'It is a lie to say this Proposal 2 will increase your taxes.' She said not allowing research on embryonic stem cells that would otherwise be discarded is 'an illogical position.' 'I do think those who oppose this know that most citizens, if presented with the facts, would tend to support it (Proposal 2),' she said. 'It's very important citizens know the truth.' Granholm has drawn criticism from Catholic Church officials in recent days for saying that favoring embryonic stem cell research is a pro-life stance. The governor, a Catholic, acknowledged that the church is opposed to destroying embryonic stem cells for any purpose 'which is a position I respect.' You can reach Mark Hornbeck at (313) 222-2470 or mhornbeckdteom.