Kliphnote: How soon the Left-heads forget that Bush
was the first to give money to GM.
General Motors Chairman Daniel Akerson tells Newsmax in an
exclusive interview that both President Obama and former President
George W. Bush should share credit for the successful bailout of the
auto industry. He also flatly denies allegations that the federal
government — which still owns nearly 30 percent of General Motors stock —
has been involved in the day-to-day running of the company. And he
warns that the economy likely has several more years before it fully
recovers.
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Obama Pushes False GM Success Story
The president's new campaign video narrated by actor Tom Hanks claims
GM has "repaid" its loans. But in a revelation by the special inspector
general monitoring the TARP bailout program, GM and GMAC together still
owe the biggest share of the remaining $119 billion TARP debt.
Of the top bailout recipients, GM is the biggest laggard, the TARP
watchdog says in his latest quarterly report to Congress. Bank of
America, Citigroup, Chrysler and Chrysler Financial all have paid off
their debt and left the TARP program. Even AIG has paid back more than
75% of what it owes taxpayers.
GM, on the other hand, still owes more than half the $50 billion in
federal funds it received when the combination of the recession and its
costly union contracts drove it into bankruptcy. And its lending arm,
GMAC (now Ally Financial), still owes $14.5 billion.
What's worse, it's not clear that GM actually repaid what it's gotten
credit for repaying. Check out this note buried in the inspector's
report: "As part of a credit agreement with Treasury, $16.4 billion in
TARP funds were placed in an escrow account that GM could access only
with Treasury's permission."
As it turns out, GM got Treasury's OK to "repay" more than $6.7
billion "using a portion of the escrow account that had been funded with
TARP funds." So GM is merely paying the government back with government
money, not money GM is earning selling cars, as the administration has
claimed.
Worse, GM in effect is still borrowing money. Consider this item from
the report: "What remained in escrow was released to GM." Bottom line:
Taxpayers have not been paid back and are still on the hook as GM
continues to require government help. Yet Obama has hailed the GM
bailout as the signature achievement of his big government programs.
"On the day I took office, our auto industry was on the verge of
collapse. Some even said we should let it die. With a million jobs at
stake, I refused to let that happen," the president said. "Today,
General Motors is back on top as the world's No. 1 automaker."
Even
that's a stretch. GM edged tsunami-crippled Toyota by counting sales at
its joint ventures in China, which aren't wholly owned subsidiaries.
And the government is directly subsidizing new GM auto lines like the
star-crossed Chevy Volt.
Ford, which didn't take TARP funds, grabbed market share from GM and
is now more profitable. Ironically, Ford for the first time in years has
outsold GM in the number of cars bought by the federal government —
although Washington still owns a huge stake in GM. Not exactly a vote of
confidence.
In North America, Ford just recorded its highest quarterly profit
since 2000. GM missed profit estimates in the fourth quarter. And
analysts are not sanguine about its first-quarter results due Thursday.
The GM story is hardly what we're looking for in terms of a recovery.
That Obama is touting it as a top economic achievement speaks volumes
about his policies.
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