General Motors announced that it will pay stockholders $543.4 million, which works out to about $11,000 per autoworker. Just days ago GM also announced that they're cutting healthcare benefits for striking autoworkers ... who GM says they can't afford to pay.
Here's the real kick in the pants. The U.S. government - i.e. the American taxpayer - lost about $11.2 billion on the bailout of General Motors. How did this happen? After investing about $51 billion to bailout GM (which had to declare bankruptcy in 2009) the feds owned a 61% stake in the company. The American government (i.e. the American taxpayer) sold its shares in the company, and suffered an $11.2 billion loss.
But wait, it gets better.
To help GM recover, and make it attractive to "investors", after bailing out GM the federal government (i.e. American Taxpayer): (1) backed all new GM warranties, (2) allowed new car buyers to deduct all car sales and excise taxes under the economic stimulus bill, and (3) Congress approved TARP-funded subsidies of zero percent financing for some Chrysler vehicles.
Breathe. Do the subsidy math.
GM owes the American taxpayer. It should start by rewarding its autoworkers with a new contract. But it won't do that. It would rather reward its new share holders, who don't create any automobiles and didn't have to suffer through the 2008 market crash like autoworkers and ordinary taxpayers (who bailed out GM).
This is precisely what's wrong with America's "market" economy.
- Mark
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Here's the real kick in the pants. The U.S. government - i.e. the American taxpayer - lost about $11.2 billion on the bailout of General Motors. How did this happen? After investing about $51 billion to bailout GM (which had to declare bankruptcy in 2009) the feds owned a 61% stake in the company. The American government (i.e. the American taxpayer) sold its shares in the company, and suffered an $11.2 billion loss.
But wait, it gets better.
To help GM recover, and make it attractive to "investors", after bailing out GM the federal government (i.e. American Taxpayer): (1) backed all new GM warranties, (2) allowed new car buyers to deduct all car sales and excise taxes under the economic stimulus bill, and (3) Congress approved TARP-funded subsidies of zero percent financing for some Chrysler vehicles.
Breathe. Do the subsidy math.
GM owes the American taxpayer. It should start by rewarding its autoworkers with a new contract. But it won't do that. It would rather reward its new share holders, who don't create any automobiles and didn't have to suffer through the 2008 market crash like autoworkers and ordinary taxpayers (who bailed out GM).
This is precisely what's wrong with America's "market" economy.
- Mark
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