Despite what the Democrats would have you believe the bailout of General Motors was not a success.
GM is once again flirting with bankruptcy despite massive government purchases propping up its sales figures. GM stock is rock-bottom. Losses continue to be revised in the wrong direction. According to The Detroit News, "The Treasury Department says in a new report the government expects to lose more than $25 billion on the $85 billion auto bailout. That's 15 percent higher than its previous forecast."
The claims that GM paid back its taxpayer-funded loans "in full" -- a story peddled in campaign ads narrated by Hollywood actor Tom Hanks -- were debunked by the Treasury Department's TARP watchdog this summer. GM still owes nearly $30 billion of the $50 billion it received, and its lending arm still owes nearly $15 billion of the more than $17 billion it received. Bailout watchdog Mark Modica of the National Legal and Policy Center adds: "In addition to U.S. taxpayers anteing up, Canada put in over $10 billion, and GM was relieved of about $28 billion of bondholder obligations as UAW claims were protected. That's an improvement of almost $90 billion to the balance sheet, and the company still lags the competition."
GM basically got $90 billion for free. If Americans wanted to pour money into a successful car company we could have started one from scratch for a lot less cash than that. The GM bailout should be understood for what it was: a bailout of the United Auto Workers union at the expense of shareholders, bondholders, and taxpayers.