The Congressional Oversight Panel reported on Wednesday that most of the $23 billion in taxpayer funds provided to General Motors and Chrysler is unlikely to be repaid. The Congressional Budget Office estimated in June that taxpayers would lose $40 billion of the first $55 billion provided to the auto industry.
The Treasury Department acknowledges that most of the $23 billion provided by the Bush Administration is likely gone forever, but added that there is a "reasonably high probability of the return of most or all of the government funding" provided by the Obama administration.
For its part, General Motors has stayed true to its roots as arrogant, unrealistic, and just plain dishonest. Spokesman Greg Martin told the USA Today that the company is "confident that we will repay our nation's support because we are a company with less debt, a stronger balance sheet, a winning product portfolio and the right size to match today's market realities."
So the Congressional Oversight Panel, the CBO, and the Treasury Department are all willing to admit that much of the taxpayer assistance to GM won't be coming back. Yet GM continues to insist -- with literally no basis in reality -- that it will be able to repay its obligations.
With spin like that, how can we believe anything GM says? The first part of the "new GM" should be a commitment to honesty and realism -- and they've already failed on both counts.
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Reader Comments (Page 1 of 1)
9-10-2009 @ 2:28PM
Bill said...
Neither administration should have given bailout money to GM. If it could not survive on its own it should have gone the way Packard, Rambler and Studebaker. The taxpayers have no obligation to GM.
9-10-2009 @ 10:50PM
FrankBank said...
Zac,
Instead of accusing GM of so many terrible things without a fact, how about investing a little time and look at the new company's balance sheet and run a scenario or two on discounted future cash flows? then offer a conclusion regarding freecash flow, and the abilty of the new company to sell stock to pay back the loans.
I know that this is the internet, but really, but the lazy name-calling mascarading as an news article is pathetic.
9-16-2009 @ 3:07AM
Ervin Raab said...
Isn't GM able to "re-emerge" clean from Bankruptcy, and "repay our national support", based on the fact they dumped all their legacy costs, etc onto the US Taxpayer anyway??
Like a dog gnawing on it's own foot, this was a lose-lose situation for America, period.
Ervin O. Raab