The cost of the Obama Administration's bailout of General Motors keeps rising. GM shares fell to a 2012 low of 19.57 yesterday.
If you recall, GM's starting share price in the company's initial public offering (IPO) after the bailout was $33 per share. Most experts estimated that the stock would have to rise to at least $52 and by some estimates as high as $103 in order for the taxpayers to just break even on the large block of shares the government was holding as 'collateral' for the $85 billion bailout.
As it turned out, the IPO was a huge bust and the Obama Administration was forced to dump stock at below market prices, something probably against SEC rules if a private investor did it.
The losses on the stock sale plus the declining price of the 26.5% of GM, or 500 million shares the taxpayers still own adds up to $16.6 billion...not counting the $26.4 billion in direct aid that's never been recouped.
There's also that $45.4 billion dollar tax credit against future profits at the American taxpayer's expense given to them by the Obama Administration that could keep GM tax free for years.GM earned a $7.6 billion 'profit' in 2011 but paid no taxes.
The gifting of GM to President Obama's union allies was simply a transfer of wealth directly from taxpayers to the unions who invested millions in campaign work hours and in contributions to get the president elected, and you can bet that a substantial amount of the taxpayer money spent to keep GM alive will simply be 'recycled' back into campaign funds for President Obama and his fellow Democrats.
1 comment:
This is only tip of the iceberg. GM had profits of 66 Billion in 2009 in china while declaring Bankruptcy in USA. How they transferred the assets penny on a dollar. For Example the equipment of Cadillac Plant in West side Detroit sold to shell company that belong to GM or Saginaw Foundry. The unions protected their members but who protecting the Salary employees. There is more to it but some one has to follow them.
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