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The bailout cost tax payers $16 billion which has not been repaid. Nothing says gift louder than that. In the meantime, they have been offshoring production of

by AmVess 8y ago

The bailout cost tax payers $16 billion which has not been repaid. Nothing says gift louder than that. In the meantime, they have been offshoring production of parts and vehicles like no one's business. I looked at a new full size truck, and it had 45% domestic content. Most of it is built in China and Mexico. The Ford that I purchased has 75% domestic content.

mdasen 8y ago
Yep, the government did take a loss on GM. Sometimes investments don't pan out. Investments still aren't gifts. If it was a gift, who was it a gift to? It wasn't a gift to GM shareholders who received none of it. If the bad-guy in this situation is greedy shareholders looking to layoff workers, they didn't get the government's money. One can certainly argue against the investment. However, it's hard to say it's a gift. Who was the recipient of that gift? If anything, it would have to be the workers who didn't face mass-unemployment in the wake of a crumbling auto industry. If the government hadn't bought GM's assets, workers would have been out of jobs very quickly. During the economic crisis, no one had the available capital to take on that risk. The government's investment meant that most of those workers saw stability (or as close to that as could be had). If you're on the workers' side, the government bailout is the side you need to be on. Shareholders lost everything while workers (for the most part) kept their jobs and benefits. Yes, there have been layoffs and contract re-negotiations, but that's nothing compared to the chaos of tens of thousands of people suddenly jobless concentrated in areas that don't have a lot of other employers (and during an economic crisis). That doesn't mean that everything is perfect. However, the bailout benefitted workers, not shareholders who lost everything.
- Scoundreller 8y ago
  It was a gift to the creditors.
  - altcognito 8y ago
    And the suppliers, whom other automakers also rely on.
deleted 8y ago
[deleted]
Aloha 8y ago
The bailout of GM, accomplished three things, the first of which - it saved the myriad of suppliers (ecosystem) the automakers need to make cars, the second was saving and unknown amount of money from unemployment claims by workers of GM, and downstream suppliers - in addition to money the pension benefit guaranty corporation would have paid out to cover GM pensions, it also preserved around 35 billion in tax revenue. While I'm opposed to bailouts like this on principle, letting an intire industry die, because one dominant player fails - the collateral damage trumps pricpleded thought here.

by AmVess 8y ago

mdasen 8y ago

Yep, the government did take a loss on GM. Sometimes investments don't pan out. Investments still aren't gifts. If it was a gift, who was it a gift to? It wasn't a gift to GM shareholders who received none of it. If the bad-guy in this situation is greedy shareholders looking to layoff workers, they didn't get the government's money. One can certainly argue against the investment. However, it's hard to say it's a gift. Who was the recipient of that gift? If anything, it would have to be the workers who didn't face mass-unemployment in the wake of a crumbling auto industry. If the government hadn't bought GM's assets, workers would have been out of jobs very quickly. During the economic crisis, no one had the available capital to take on that risk. The government's investment meant that most of those workers saw stability (or as close to that as could be had). If you're on the workers' side, the government bailout is the side you need to be on. Shareholders lost everything while workers (for the most part) kept their jobs and benefits. Yes, there have been layoffs and contract re-negotiations, but that's nothing compared to the chaos of tens of thousands of people suddenly jobless concentrated in areas that don't have a lot of other employers (and during an economic crisis). That doesn't mean that everything is perfect. However, the bailout benefitted workers, not shareholders who lost everything.

Scoundreller 8y ago
It was a gift to the creditors.
- altcognito 8y ago
  And the suppliers, whom other automakers also rely on.

deleted 8y ago

[deleted]

Aloha 8y ago

The bailout of GM, accomplished three things, the first of which - it saved the myriad of suppliers (ecosystem) the automakers need to make cars, the second was saving and unknown amount of money from unemployment claims by workers of GM, and downstream suppliers - in addition to money the pension benefit guaranty corporation would have paid out to cover GM pensions, it also preserved around 35 billion in tax revenue. While I'm opposed to bailouts like this on principle, letting an intire industry die, because one dominant player fails - the collateral damage trumps pricpleded thought here.