By on June 1, 2011

According to the White House’s just-released report titled “The Resurgence of the American Automotive Business” [PDF here]:

The U.S. Government provided a total of $80 billion to stabilize the U.S. automotive industry through investments in General Motors (GM), Chrysler, Chrysler Financial, Ally Financial, and programs to support automotive suppliers and guarantee warranties. As of today, $40 billion has been returned to taxpayers. While the government does not anticipate recovering all of the funds that it invested in the industry, the Treasury’s loss estimates have consistently improved – from more than 60 percent in 2009 to less than 20 percent today.

Independent analysts estimate that the Administration’s intervention saved the federal government tens of billions of dollars in direct and indirect costs, including transfer payments like unemployment insurance, foregone tax receipts, and costs to state and local governments.

This is as close as we’ve gotten to a thorough accounting of the full cost of the auto industry bailout, as both GM and Chrysler have erred on the side of counting as little of their own taxpayer support as possible (leaving out aid to their predecessor firms, finance companies and suppliers). On the other hand, it’s also two short paragraphs in a ten page report… and the rest of the document hews pretty closely to Democrat strategist Ron Klain’s advice to the White House, specifically

tell the story with fewer numbers and more emotion; less prose and more poetry

While the media debates whether this means the bailout bill will come to $14b or $16b, it’s becoming clear that the final number won’t make a big difference… at least politically.

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69 Comments on “Quote Of The Day: The State Of The Bailout Bill Edition...”


  • avatar
    jjster6

    Billion here, billion there, pretty soon it adds up to be real money.

  • avatar
    mike978

    +1 lol. I hope those who are picking over a few billion are also concerned by the >$120 billion spent annually on defense procurement. That adds up real quick too.

    • 0 avatar
      MikeAR

      Last I checked defense spending is Constitutional. Provide for the common defense and all that. But find something that says soending taxpayer money bailing out private companies and unions fits in the original intent of the founder. Report back to me on that please.

      • 0 avatar
        mike978

        Well the air force is not constitutional – not mentioned anywhere in the hallowed text. Joking aside – defense of the homeland is constitutional and was the founders intent. Having a large military-industrial complex costing significant sums of money was, probably, not in their mind.
        Anyway the point still holds about being concerned by a possible $10-20 billion onetime loss when many times that is spent on massive and in some cases wasteful procurement projects every year. Lets be consistent in our financial conservatism.

      • 0 avatar
        psarhjinian

        Last I checked defense spending is Constitutional

        What part of, eg, Iraq or Afghanistan that was legitimate “defence” is debatable. That clause originally referred to a well-regulated militia, but it could extended in all sorts of horrible ways anyway, and often is, considering how often the “national security” canard is pulled.

      • 0 avatar
        srogers

        I guess that this is considered “defense” if you follow the principles of “The Secret Welch Art of LLAP-Goch”.

      • 0 avatar
        jmo

        But find something that says soending taxpayer money bailing out private companies

        “The Congress shall have Power To lay and collect Taxes, Duties, Imposts and
        Excises, to pay the Debts and provide for the common Defence and general
        Welfare of the United States;”?

        Seems like one could argue that the auto bailout both provided for the common defense (maintaining a domestic manufacturing base) and promoted the general welfare (reduced the economic disruptions of a massive ill timed bankruptcy).

      • 0 avatar
        John Horner

        “Last I checked defense spending is Constitutional.”

        What do permanent military bases in Japan, Korea, Germany, Saudi Arabia and so on have to do with the defense of the United States? Can we at least go back to honestly calling it the Department of War instead of the newspeak Department of Defense?

  • avatar
    Darkhorse

    I think we are all going to be sick of this subject by 11/2012. If the Detroit 3 are all alive by 2020 then I guess you’d have to say it was a success.

    • 0 avatar
      highdesertcat

      Yeah, but a loss is still a loss. Whatever happened to all that talk about the bail outs being “loans” that were to be paid back? Nah, this was nothing but a bad precedence of bailing out the select few at the expense of the US tax payers. I would be surprised if Ford and GM make a come back, and if they do, they’ll still take their production and assembly elsewhere. Gotta go where the money is. Like jjster6 posted, a billion here, a billion there…

      The big winners? The UAW. The big losers? The US tax payers!

      • 0 avatar
        JKC

        In case you’d forgotten, UAW members pay taxes, too.

      • 0 avatar
        Steven02

        While I agree that the UAW was a big winner, I am not sure you can call the US tax payer the big loser. The tax payers pay 12 to 16 billion. What is the state of the economy if the tax payers do nothing? How much lost taxes at the state and local level happen? How much do people who pay taxes after all the job losses have to pay to keep the gov’t running? How much interest is going to be attached to loans that the gov’t takes out to keep the lights on?

        While, I am not happy about what will be lost in the end, I am not sure that you can call the tax payer the big loser.

      • 0 avatar
        highdesertcat

        The way I see it, far more people lost their jobs since 2008 than work in the US auto industry. Those who lost their jobs did not get any bail out help. And while bankruptcy and liquidation of GM and Chrysler would not have been pleasant they would have restructured and soldiered on, without the bail outs. I didn’t like it when Bush bailed out failed entities, but when Obama doubled down on it to repay his UAW buddies for putting him in office, that iced the cake. Which brings up the political aspect of it all. How well you are doing today under Obama is directly related to his bail outs. If you are doing well under Obama it is no wonder you give credit to the bail outs. But if you aren’t doing as well under Obama as you were under Bush Jr or Clinton, then you also blame the bail outs — because you didn’t get any. Any time the people who pay the taxes lose money it is a loss only to the people who paid that money in taxes. The people who don’t pay any taxes don’t lose anything. And as far as the UAW also paying taxes, of course they do! But they collected far more from the tax payers than they paid in, when the UAW got bailed out. Think about it. The UAW was put on the government payroll with the bail outs, in essence they became civil servants, employees of the tax payers. So they gave back a little of the tax payer money they received. They still collected a lot more than they paid in. Ask yourself who will be the next recipients of bail outs? Will you get bailed out if your employer goes tits up? Not unless you’re UAW, SEIU or AFL-CIO. So what are the rest of us non-union people? Chopped liver?

      • 0 avatar
        jmo

        Those who lost their jobs did not get any bail out help.

        99 weeks of unemployment?

      • 0 avatar
        Steven02

        So, would the American tax payer be better off without a bailout and 1 million plus more people out of a job? It literally could have caused another depression. Would that have been better for the American tax payer?

      • 0 avatar
        jkross22

        The argument that the taxpayers got stiffed would go away if GM, Fiat and Ford repay all of their “loans” with interest. That has not happened as of yet, therefore, the point continues to be made.

        You can say 1m people would be out of work, but that too is unprovable. We don’t know what would have happened had GM and Chrysler been allowed to fail. You say 1m people out of work, I say another player would have entered in and picked off the best pieces. Who is right? We’ll never know.

      • 0 avatar

        So, would the American tax payer be better off without a bailout and 1 million plus more people out of a job?

        Silly me, I failed to see the memo that companies should now exist solely as jobs programs — to hell with competitiveness and accountability!

        (But for what it’s worth, society would have continued on just fine, if after a fashion.)

      • 0 avatar
        highdesertcat

        jmo, many of those people who received the 99+ weeks of unemployment still lost everything, had to declare bankruptcy and have moved back in with their parents. One of those families is living with his parents just a few houses down from where I live. This is a guy I told you all about in an earlier post – he used to work selling Chrysler products and was let go because lack of sales eliminated his position. But there is some good coming out of all this for him. His dad who now lives near me in New Mexico owns a long-held family farm near Pembina, ND, and his son will take it over from him. At least he’ll have a place to live. 99 weeks of unemployment only delayed the inevitable for many. It was not a bail out nor did it prevent bankruptcy and financial ruin. Like I said, a person’s point of view about bail outs depends if you are on the receiving end or the tax paying end. And how you vote in 2012, if you vote at all, depends on just how great you are doing under Obama’s economic policy. Do you really want four more years of this hope and change? No doubt, if you got bailed out and continue to live large on tax payers’ expense you would gladly vote for more and greater hand outs in the future. But if you are a tax payer seeing all this waste of money, then maybe not so much, eh?

      • 0 avatar
        John Horner

        “And while bankruptcy and liquidation of GM and Chrysler would not have been pleasant they would have restructured and soldiered on, without the bail outs.”

        That is a mighty big assumption. Do you know how many auto makers went extinct during the Great Depression? Do you know what became of the entire domestic UK auto industry? Have you bought any British Leyland products lately?

        Absent government involvement, Chrysler for sure would have simply been liquidated. Someone might have bought the Jeep brand (probably a Chinese company), and the rest would be gone. GM as a brand likewise might have found a home in China or might have been liquidated entirely. Check out how many British made MGs have been built since that company went bust and had the last pieces purchased by a Chinese company.

      • 0 avatar
        Steven02

        @Rob Finfrock

        Changing the argument, nice. The debate was about the American taxpayer being the biggest loser. Society would have gone on, that is true. But it may have went through a depression too. I guess we can just not realize that it might be something we want to avoid.

        @jkross22

        The 1m plus number was a worst case scenario. It is quite possible if the supply chain collapsed. I am not sure who would or could have stuck around if the supply chain went under, that includes Toyota and Honda. They may have been only building cars in Japan shortly after a supply chain collapse. Ford would likely be gone too. With that scenario so bleak and in chapter 7 bankruptcy, who is picking up the pieces? My guess, the technology would have been sold to different players, mainly Chinese. The supply chain would be gone in the US before the Chinese players would have been able to start production backup in the US, so those jobs would have been lost for a long time.

        That is the scenario that was trying to be avoided. If you think someone would have jumped in quickly to try to buy GM or Chrysler at a time when no banks were lending, who would it have been? How long do you think the sale would have taken? A 363 sale worked because it was quick. Dividing up the assets and selling them at an auction would have taken too much time for the supply chain. So, who comes in quickly to make this happen? My guess, if anyone else could have done it, it could have been the Chinese gov’t. But, I don’t see that happening.

      • 0 avatar
        highdesertcat

        John Horner, what you say is true. It is a mighty big assumption, and not one that I made on my own. But liquidating GM and Chrysler would have been preferable than this never-ending life-support of already defunct US automakers, and their UAW partners in crime, in some form or some fashion, be they direct bail outs, indirect hand outs or special tax accommodations and exemptions. Once the shake-out of the US auto industry is completed, anticipated to be in the 2015/2016 time frame according to some analysts, the US auto industry landscape will be vastly different than what it is now. Preferably, GM would be chopped up and sold off to any foreign enterprise that would have it, the Chinese comes to mind, and Ford would be bought lock, stock and barrel by Toyota, continuing to build the best-selling truck in America, the F150, with a Toyota drive train underneath. WOW! My hope is that by then the US tax payers who so generously gave to these losers will have recouped the majority of their money back. I do not believe we will ever get back all of the money back that was wasted on this fool’s errand of bailing out a bankrupt GM, but we did the right thing by giving away Chrysler to Fiat. Where we went wrong with Chrysler is that we had to bribe Fiat to take this wreck. You know, with the finance industry the odds of getting all our tax payer money back is infinitely better than with the US auto industry. After all, the finance industry is in the business of MAKING money and has a rich history of doing so. The US auto industry has a rich history of losing money and has been on a downward spiral to oblivion for decades. But until the shake-out is completed all we can do is speculate and do a little armchair quarterbacking, and decide for ourselves what to buy. The logical choice is to buy GM and Chrysler products if you believe in bail outs. But if you do not believe in bail outs but simply must buy American, then you can always buy a Ford. Otherwise, buy something else. It is not like we have a shortage of excellent auto manufacturers to choose from in the US.

      • 0 avatar
        Steven02

        The finance industry has a very rich history of throwing the entire economy into recessions and a depression. Let’s not write the history that makes your point convenient, but the actual history of that industry.

        Can you show reports of the analyst that think all of this is going to happen in 2015/2016? Because I just don’t see that happening.

        I don’t see GM going bankrupt in 5 years. The balance sheet is too strong right now unless we have another carmageddon, which they are better prepared for this time.

        I also don’t see Toyota buying Ford unless Ford gets much smaller first. It doesn’t make sense for Toyota to buy all of Ford either. It simply doesn’t need Ford. The F150, while good in the states, it is only good in the states. Ford does sell better in Europe than Toyota, but Toyota competes there as well. I don’t think Toyota wants to become the next GM with too many brands and competing with itself. Buying Ford would be a big step in that direction.

      • 0 avatar
        geozinger

        @highdesertcat: “After all, the finance industry is in the business of MAKING money and has a rich history of doing so.”

        And exactly how are they making back that money? At the consumer level, have you noticed how much bank fees have gone up? How’s your savings account doing? Are you loving that 0.5% interest rate? How come car loans are still 4 and 5%? These large banks are still foreclosing on homeowners, still calling in loans to small businesses. My wife’s former employer went out of business due to Wachovia screwing over the company she was working for. Additionally, it’s nice to have friends in Congress. Forget the UAW, the banksters have made out on this deal…

        How are they making back that money? By sucking it out of your wallet. When the credit card companies are asking “what’s in your wallet?”, it’s because they want to empty it.

      • 0 avatar
        highdesertcat

        Steven02, I have bet a lot of money on the finance industry in the past and they’ve done right by me. I would bet money on the finance industry over the US automakers any day. I believe you did not see GM’s, nor Chrysler’s, impending bankruptcies in 2008 either. But many people did. And they managed their investment portfolios accordingly.

        geozinger, the finance industry is not investing in America right now but they are making money, elsewhere, mostly outside of America. What the finance industry did in the past was perfectly legal and sanctioned by the US Congress. The unintended consequences and massive failures should not have been rewarded with tax payer bail outs.

        Fiat is going to increase its share in Chrysler to 52% soon, but a loss is still a loss. At least we, the people, got most of the money back we showered on Chrysler to keep the lights on. Can we all agree now that Chrysler is a foreign-owned company manufacturing in America? Just like Toyondasan, Hyundai, Kia, Subaru and all the rest.

      • 0 avatar
        MikeAR

        Highsesert, congrats on making money in the market, its hard to do and you did well. But, and I hate to sound like some kind of socialist here, but what you made was truly tiny compared to what the industry has looted from the country and taxpayers over the last 3 years. Read about the Quantitative Easing programs and the POMO program run by the Fed. Dig into the AIG rescue. Find a list of the borrowers from the Fed Discount Window during the crisis. Like it or not, the markets are being manipulated now for the benefit of the Too Big to Fails. The fact that no major figure during the collapse has been put on trial is pretty much proof that the game is rigged.

        The financial industry has stolen more than the entire car bailouts by a factor of 100, just a guess but I bet a close one.

      • 0 avatar
        highdesertcat

        MikeAR, it’s all in the timing. Anyone can make money in the market if they pay attention to the indicators and warning signs out there. For instance, I was, at one time, invested in GM and Ford. I owned their products so it seemed only natural to own a couple blocks of their stock. When things seemed like they had peaked I divested. I had other holdings as well but in the 2006-2007 time frame I started to divest and cash out, in preparation for applying for my social security retirement at age 62 in 2009. I am now completely out and LMAO! Millions of others did the same, so my approach was not unique. I read a lot of material to include the Money web sites like Bloomberg and CNBC, the WSJ, Value line, MSN-Money, etc. But when it comes to putting MY money on GM (or even Ford) now? I would have to decline. I see what my relatives in the auto-retail business are going through, and other dealerships as well, and man, let me tell you, operating expenses are overwhelming these days, with more to come under Obama-care. And when you couple that to depressed profit numbers (because of the economy and current pricing strategy of the auto makers), it’s easy to see that we have a little ways to go yet with this shake up of the US auto industry and realignment of manufacturing capacity in relation to North American demand. I’m betting that only the strong will survive. Regardless of the views of my learned fellow posters, I don’t believe that GM as we know and love it today will be around in 2015/2016. I see GM-China! Silverado and Caddy made under Communist Chinese supervision and ownership, like Fiatsler. And Ford? I hope they do well but I see them consolidating some parts of their operations in the future. They have to! They are still not selling enough of their wares to make it on their own without special help in some form or another from the gummint. The only thing Ford sells any appreciable quantity of is the F150, in its various iterations. But I could see enormous success in a Fusion/Camry combined endeavor. And a Fundra150 would be one hell of a truck, especially in the 5.7-liter incarnation. I might just buy one of those when I trade my 2011 Tundra in 2016.

    • 0 avatar
      MikeAR

      John Horner, you defeat yourself when you use the Depression auto industry and BL to argue for the bailouts. You know that in the long run and for that matter the short run too, no one missed those jobs or those companies. Both the US and the UK have had periods of recession and boom since then and no one really mourns Packard or BL and certainly eveyone who lost their jobs moved on to something else. No one starved because one company went down. Also why should we support a company that is failing? If you want to do that, then use your own money, don’t lobby the government to take mine.

      • 0 avatar
        Steven02

        You are so right MikeAR, how could anyone miss jobs during the depression.

        They don’t mourn the jobs of Packard right now, but you bet they did when it went under.

      • 0 avatar
        MikeAR

        Yeah they did, but those guys went out and got other jobs, somewhere, somehow. If you would look, you would be suprised to see just how adaptable people are. If someone like you would have been alive back then, it sounds like they would have just sat around until they starved to death waiting for the government to bail something out.

  • avatar
    Steven02

    I am really surprised by the results of the study that did a worst case scenario.
    http://www.cargroup.org/pdfs/bankruptcy.pdf

    That report says it saved over 1 million jobs and saved the gov’t 32 billion. I understand that the report is slanted and that is the worst case scenario analysis, but still interesting.

    • 0 avatar
      MikeAR

      First thing, the Center for Automotive Research is an industry funded think tank. Do you really expect them to come to any other conclusion?

      Second and most important, the study reached that conclusion on jobs lost by assuming that if GM and Chrysler weren’t bailed out then every person working at those companies, Ford, every person at every suppllier and every person at every dealer would have lost their jobs. The employment numbers of the study aren’t valid, therefore the cost using those numbers isn’t valid either. A waste of paper and time.

      • 0 avatar
        Steven02

        I acknowledge that they are not an unbiased organization, yet, has anyone seen a report of the base case scenario if there wasn’t a bailout, specifically of the auto industry. My guess is no.

        But, you also don’t understand what a worst case scenario is. The worst case scenario would be that everyone at Ford lost their job too. If GM and Chrysler went under, causing a collapse of the supply chain, Ford would have likely gone out of business too (Ford’s CEO thinks the supply chain would have collapsed with a GM and Chrysler bankruptcy). Toyota and Honda would have had big production hits in the US as well because the suppliers going out of business. So, it should big hits to all domestic production.

        That is what could have happened. No one is 100% sure that would or would not have happened.

      • 0 avatar
        jkross22

        Steven02,

        It’s also possible that another mfg could have bought the best run parts of GM and Chrysler and ran with it.

        Doomsday predictions rarely reflect actual facts of situations, as they are being made by the players directly involved.

        As it stands now, money is still owed to taxpayers, we likely still have overcapacity, GM still looks like the proverbial tired swimmer (albeit with improving products) and Chrysler was essentially given to a foreign owned company.

      • 0 avatar
        MikeAR

        Steven02, I understand very well what a worst case scenario is. In fact, I’m kind of inclined to be pissed off that you would say that. But unlike you, I won’t underestimate your untelligence. Until you earn it, I’ll show you that much respect, although I don’t think you deserve it. You do understand, they were payed to reach that conclusion. They were just giving the customers what they ordered. You did just as well as they did and you weren’t even paid for it. Yours is just as valid as theirs too.

      • 0 avatar
        Steven02

        @jkross22
        Who? Tell me someone it would have made sense for and was capable of buying parts of the companies. To keep the supply chain alive, they would pretty much have to be building the same things that they were building now and slowly change over to building something else. Who wants to do that? Again, if you don’t keep the supply chain alive, the purchase is a failure.

        Toyota doesn’t need anymore cars, has capacity problems of its own, and is losing money during carmageddon. Does it want to take on the UAW and start building Chevys for awhile?

        Honda is too small to make this work.

        VW has capacity problems in Europe and is a full line manufacture. They don’t want to build Chevys. They will be able to sell more cars from Germany to the US.

        Hyundai/Kia, probably the best bet. But I don’t think they would have done it either. They would have been the least effected considering that most of their cars are built in Korea. The extra capacity would be nice, but I don’t think they are interested in building Chevys. What was their cash situation in 2008?

        Ford, already mortgaged to the hilt. They don’t have the resources.

        Honestly, I think the real best bet is the Chinese gov’t. I don’t know if the bankruptcy sale would have gone quick enough to keep the supply chain going. Too much delay, and the supply chain is done. They might be interested in making Chevys here and back home. But, if they waited, they probably could get the items cheaper, killing the supply chain.

        To keep the supply chain going, GM and Chrysler needed to suffer slow deaths. That would give the supply chain enough time to change what it was making. A quick death means the supply chain would have gone under.

      • 0 avatar
        Steven02

        @MikeAR
        Your post didn’t seem to understand that the report was based on a worst case scenario which would include all of those people losing their jobs if the supply chain went under. You say the employment numbers aren’t accurate. Do you have any information to say what the employment numbers are?

        But please post about how you don’t want to insult my intelligence and respect. After all, this is the internet.

        But if you want to have a discussion, post facts. Yes, they were paid to come up with this report and probably given the direction on which way to go. Reports that are paid for are most often biased to give the result on what people want. That alone can’t be an excuse for dismissing the assessment. If you think that is the case, then you could say the same thing about Exponent’s report on Toyota’s electronics (for the record, I see no other reason besides Toyota paid for it to doubt the report, and I don’t doubt it). IMHO, you should propose a different and likely scenario that can be debated upon. I for one, think that the entire supply chain could have collapsed. I think that was a very real problem that could have happened. I don’t know if the 1 million number is correct, but I don’t know what the number would have been.

      • 0 avatar
        MikeAR

        Steven, looks like I was wrong, I did overestimate your intelligence, Oh well, I won’t be doing that again. Do you really think that everyone in every business remotely realted to the auto industry would have lost their jobs had GM and Chrysler not bailed out? Are you serious? Iknow you’re trying to make a partisan point but that’s silly. Do you think that all the dealers who lost their franchise shut their doors? No, they didn’t. many stayed open as used dealers and service facilities. So be practical it wouldn’t have happened. Ford was still open, would they have just given up because their two domestic competitors shut down? No, of course not. Would every supplier have immediately closed their doors? Your original post was a feeble attempt to justify something that even now with hindsight we can’t say would have been the end of the world or even particularly traumatic.

        I stand by my thought that you should have been done the CAR study. Your worst case is just as bad as theirs and just as valid. Worst case scenario, what a joke.

      • 0 avatar
        Steven02

        I knew the internet insults would continue. But, my intelligence shouldn’t be what you have to worry about. You still don’t understand what a worst case scenario is. It is taking an assessment of what the worst possible outcome could be. The worst possible outcome could have been all of those people losing their jobs. Honestly, it is a small chance, but definitely a possible one.

        Your assessment of what would have happened is just flat wrong. Some dealers may have went into the used car business. I agree with that. But 4500 new used car dealers? You think that is going to work. I would say many of them would be closing their doors within a few years.

        But, on the supply chain part of it, you are completely wrong. The supply chain would have lost its biggest and another large player in the industry go under. Changing production from part A to part B takes a lot of time and money. 2 things that the suppliers don’t have. But, the worst part is, there isn’t a part B to go to, let me explain. During carmageddon, car sales numbers were down. Manufactures and suppliers were hurting. There was extra capacity, mainly from the Detroit 3, but from others as well. Now, take out GM and Chrysler. That is going to take down several suppliers who depend on them for business. Now, the US auto industry has to try to find new suppliers to take up the slack because they depended on the same suppliers. While this is happening, orders to suppliers that are still in business are getting smaller because with out parts from the suppliers that went out of business, they can’t complete cars.

        So now, suppliers can sell more parts because the manufactures aren’t buying them because they need other parts to complete cars. How long do you think those suppliers stick around? How long does it take to get production from what the old suppliers was doing to come up to speed?

        The volume of cars needed can’t be made up by the existing companies in the business because they don’t have the capacity. Suppliers are going out of business making actual capacity much smaller due to parts shortages. Ford may not have been able to survive this.

      • 0 avatar
        MikeAR

        Steven02, you’re right, maybe I don’t understand the concept of worst case scenario, but obviously you don’t either. The true worse cse scenario in your understanding would be the complete destruction of the universe because GM wasn’t bailed out. A worst case scenario is supposed to be at least somewhat plausible. A complete shutdown of all the industry was not and is not plausible except for you fanatics who keep on defending the indefensible because of you ideology.

        By the way, you started insulting my intelligence, I just pointed out to you how ridiculous your view is.

    • 0 avatar
      RangerM

      The Obama Administration (itself) says the auto bailout cost the U.S. Taxpayer $14 Billion.

      http://news.yahoo.com/s/ap/20110601/ap_on_re_us/us_obama_autos_2

      I would expect this is an optimistic estimate.

  • avatar
    Sundowner

    A lot of Americans don’t truly understand how bizzare we are in the world. Are there ANY truly independant car companies of globally competitive size in other countries with no support or part ownership from the home governments? I believe the same is true of airlines and railroads.

    • 0 avatar
      Ubermensch

      There are NO major global companies that have not benefitted significantly from either major public funds and/or outright bailout or nationization. The US is no different in this respect, we just suffer from more cognitive dissonance regarding “free markets.”

  • avatar
    musiccitymafia

    Interest on the $80 billion takes it to what …

  • avatar
    fredtal

    The real bs will be from the candidates as they tour auto plants. Will those tea party folks stand up and tell all those workers that the bailout was a mistake. Or will they claim it was all their idea. Let’s hope the one who speaks the truth wins.

    • 0 avatar
      jkross22

      Hah! Good point. The Democrats will certainly rush for their photo ops at auto plants, and on the way out, collect more UAW money for their continued support of the cause.

    • 0 avatar
      MikeAR

      Fred, you gave yourself away there. What has the Tea Party, not even a real party and not in existence when the bailouts happened got to do with the bailouts? The true slime slithering through the plants will be Democrat politicians chumming for cash and claiming credit until GM fails again.

      • 0 avatar
        fredtal

        So what do you think a republican or anyone for that matter will say when they tour these plants? Why do republicans support oil industry subsides but not auto industry? It’s all comes down to who pays them. Decomcrats get union support and republicans get oil money. They are both wrong, if that is their reasoning.

      • 0 avatar
        MikeAR

        You are so wrong that it has got to be malicious on your part. You say something you know to be not true in hopes no one will verify. Guess what, one of the Democrats’ and Obama’s biggest contributors was BP (an oil company), Exxon Mobil also gave more to Obama than McCain and I could go on but I won’t. It’s tiresome fact checking people who don’t care about truth.

        And again, those so-called subsidies are companies taking advantage of the tax code. If you don’t like that, well complain to your guys, they controlled Congress and wrote the tax code before this January. Be even handed anyway and complain about GE and Google taking advantage of the laws as written. Or for that matter what about GM’s tax loss carry forward that has never been allowed before for any other company. Where are your screams of righteous indignation about that?

        And why would any Republican go into an UAW plant? That would be like a fat guy going into a cannibal village. It’s worthless and dangerous.

      • 0 avatar
        Jellodyne

        You’re absolutely right, MikeAr, a Republican would never campaign at a UAW plant. Never in a million years! Not that you’d know that if you were reading these lies printed by the liberal media:

        http://www.salon.com/technology/how_the_world_works/2010/09/20/bob_corker_booed_at_spring_hill

        I’m awaiting your kind insults in reply.

    • 0 avatar
      fredtal

      I’m not able to reply to the comments below that I want to so I have to reply here.

      1. Campaign contributions always increase to the leader towards the end of a campaign. Oil companies want Obama’s ear so they raised their entrance fee.

      2. My point is NOW politicians need to campaign for votes, they want the auto workers support. What are they going to say to them? Will they be like Romney? http://thinkprogress.org/politics/2011/05/25/169464/mitt-romney-auto-flip-flop/

      3. Please do not say I’m not interested in the facts or the truth. This is a politial discussion and the best we can hope for is a compromise.

      • 0 avatar
        MikeAR

        You have points, I’ll give you that. But the timing of contributions matters much less than the fact that contributions were made. The urge to make nice with your enemies is something that I don’t understand or condone. How any well run business could contribute to any Democrat is beyond me, except for selling the rope that they will be hanged with. Lenin was right about that. Access is a kind word for bribes when it comes to donations to mortal enemies.

        As far campaigning at UAW plants, why bother? That’s a mistake by any Republican and is a sign that something is wrong with them, like maybe they’re in the wrong party. You might be suprised to see a winning Republican campaign be done by appealing to the Republican and independent base. Forget rtying to appeal to people who are lost because of ideology. Know your enemies and treat them as such.

  • avatar
    tparkit

    Just the sort of DNC talking-points crap I’d expect from the Obama White House. For example, here’s a nice little $45 billion going-away present for GM that didn’t make the report:

    http://online.wsj.com/article/SB10001424052748704462704575590642149103202.html

    …and the taxpayers aren’t getting that back.

    • 0 avatar
      Steven02

      And the taxpayers wouldn’t have gotten anything for that either if it wasn’t for the bailout.

    • 0 avatar
      jkross22

      The GM bailout rewarded failure. Bankruptcy doesn’t allow tax credits to be pulled forward, but with GM’s faux ‘bankruptcy’, they were able to double dip.

      Pay to play worked wonders for GM and the UAW.

      • 0 avatar
        Tommy Boy

        +1

      • 0 avatar
        Ubermensch

        Failure has always been rewarded in capitalist economies, this is no different. Profits are privatized and risks are socialized. It’s how the real economy works, there is no example of a truly free market and I would hazard to say it can’t exist.

      • 0 avatar
        MikeAR

        Untermensch, how has failure been rewarded in capitalist economies? Can you name one instance of a bailout or rescue under a pure capitalist system? Keep in mind that there is no real pure capitalist system and never has been anywhere? But since you seem to think that pure capitalsim is everywhere name one bailout for me. If pure capitalism dooesn’t exist you just negated the very point that you were trying to make. Not bad, arguing against yourself in the same post, a new record of futility there.

      • 0 avatar
        Ubermensch

        MikeAR, I should have been more specific… when I said capitalist economies I mean “state capitalism” which is the form of capitalism that really exists.

    • 0 avatar
      shaker

      It could be said that the massive government programs instituted by Roosevelt after the Great Depression ensured the survival of the country at a subsistence level, while our great capitalist system languished on the sidelines, too timid to invest in the country that nurtured their growth.
      The only thing that brought the US out of the Great Depression was WWII, and more massive government investment in industry to support the war effort. After WWII (The defense of Europe and the Pacific was a massive, unpaid “bailout”), these modernized industries were turned over to the “capitalists” for pennies on the dollar (yet another “bailout”) which was perceived at the time a very positive thing, as it set the stage for the unprecedented prosperity that the US enjoyed for many years since.
      So, as recent history shows, government investment (and even takeovers) of private industry may not be spelled out in the Constitution, but have contributed not only to the survival, but to the prosperity of the USA – the times when this country has teetered on the edge of failure have been almost always been precipitated by unbridled capitalism and greed.
      Capitalism cannot exist in a country without the collective “safety net” provided by the collective wealth of the population, concentrated and directed by the government, elected by the people to protect the country that they love from forces (internal and external) that threaten to destroy it. Without proper oversight, the economic “engines” that power this country would inevitably send it flying off a cliff; we need “brakes” and “steering” as well as “fuel”, and that’s what proper government should provide.

      • 0 avatar
        MikeAR

        The wartime factories were in most cases already owned by those evil capitalists that you hate so much. Guess what, they sacrificed their civilian production to contribute to the war effort. They were paid for it too, as they should have been. So you don’t have a valid point at all.

        Also, most non-partisan economists believe that the Roosevelt Administration prolonged the Depression with their misguided and harmful policies. You’re actually trying to give them credit for something that they caused. Sorry, that doesn’t work. They were in the process of sliding the country into a new worse depression when WWII saved them. Without WWII, the elected king’s legacy would have been that of a total failure and incompetent instead of what it wrongly is now.

      • 0 avatar
        psarhjinian

        Also, most non-partisan economists believe that the Roosevelt Administration prolonged the Depression with their misguided and harmful policies

        And by “non partisan” you mean “people I agree with”

      • 0 avatar
        MikeAR

        Psar, yeah pretty much because I happen to be right on this.

      • 0 avatar
        Jellodyne

        “non partisan” = “fair and balanced”. In this context, exactly how Fox News uses it.

      • 0 avatar
        MikeAR

        As opposed to the non-partisan MSNBC or Politico or Daily Kos? It is completely undeniable that the economy weakened greatly in the mid-30s because Roosevelt had an iron hand on the economy and his utopian socialists had no idea that what they were doing would fail. Read the book “The Forgotten Man”, you may learn something. It won’t be to your liking but that’s what really happened.

  • avatar
    Zackman

    You know, with all I have been reading and hearing on all media about the actual state of the economy – and the world’s for that matter – these bailout discussions may soon be the least of our worries!

    • 0 avatar
      highdesertcat

      +1 Zack! I agree 100%. We are heading for some deep sh it the rest of this year and next, to be sure. Just look at the housing market. I wonder how many people enjoy having their homes valued at only 70% of what they bought it for just two short years ago? How do you say ‘underwater’ or ‘upside down’? I have friends and relatives in Western Europe and they tell he that they are already pinched badly by a socialist system that can no longer bear the burden of all the freebies it provides. Of course that’s not our worry until the same starts to happen here. Obama owns this economy now, even if he claims to have inherited it. Without being political, we have to ask ourselves if we are better off under Obama’s economic policies, or if we were better off under the policies of Shrub and Clinton. That’s the question that faces the people who will vote in Nov 2012. I can tell you right now, my dollar doesn’t buy near what it did during Shrub and Clinton. And I don’t care about the price of gas. I’m going to buy it no matter what it costs. But I do care about the price of rice and rent… And things look pretty shaky up ahead.


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