Did you see the big big headlines today? GM pays back government loans from US, Canada!!!
Well, like everything else in Washington today, the story they let you read is not the full story. As reported here for example, General Motors Co. has repaid the $8.1 billion in loans it got from the U.S. and Canadian governments, a move its CEO says is a sign automaker is on the road to recovery.
Oh, but not so fast! Don't forget that GM still owes $45.3 billion to the U.S. and $8.1 billion to Canada, in exchange for which they received large stakes in the company. The U.S. government now owns 61 percent of the company and Canada owns roughly 12 percent.
Why did we buy GM? Was it to save jobs? Was it to keep the company running? Oh of course not. In a Chapter 11 bankruptcy, the company would have reorganized and continued to run while it got its books and operations back into order. So what would have changed?
Thank you for asking! What would have changed would have been the union contracts! And the unions poured a lot of money into Obama's election and wanted to be paid back. And so they were: we paid them back by buying the company to preserve their anti-competitive contracts.
Love that Hopey Changey thang!
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