bloomberg.com— General Motors Co., which regained the global auto sales lead last year, earned $9.19 billion last year, the largest profit in its 103-year-history, while its European business again lost money.
Feb 16, 2012View in Crawl 4
Amazing how many people are not happy about a large American company doing well. If they continue to be profitable, their stock price will increase and we'll eventually be able to recoup our ENTIRE investment in GM. If you're an American taxpayer, you should be rooting for GM, not s**tting on their name. They literally aren't the same company they were prior to bankruptcy.
Did you not understand that the bailout required shares of the stock to be placed in the hands of the government so that the government would recoup all of the costs of the bailout should GM become successful again? It was an investment and without it, the company would have been lost or at best dying a slow death.
I'm opposed because I understand, Josh. The government has no business playing financial adviser - they can't even balance their own budget, for goodness sake.
If/when the government sells those shares, you can bet we won't see a dime of it.
Ford decided to forgo a bailout and they're not "dying a slow death" (on the contrary), because government isn't the only solution to every problem.Comment is buried, click here to see the rest.
"Ford decided to forgo a bailout and they're not "dying a slow death" (on the contrary), because government isn't the only solution to every problem."
Ford didn't have the same extend of financial problems....they didn't take the bailout because they were not going to go bankrupt. GM & Chrysler were going to go bankrupt.
@chadpyle I didn't digg you down btw, I don't do that unless the statement someone makes is outright retarded.
I see the viewpoint but in this case it looks like all success. Ford is different from GM in so many ways and I believe that stimuli during a recession is the best solution. It's just sickening to think of where it all went this this time around.
The only real impact it has is on the buyer's account. It doesn't affect a company account. Depending on the type of share you have and if you're an employee, you can get shares that give you dividends, some with no rights to vote etc etc. The average company has around 20-30 types of shares. Now stop spouting stupid crap.
Your comment about shares makes you an ignorant, Shares aren't "REAL" money. It doesn't affect their bank accounts or anything. You could buy 1mill. shares and sell them a year later and it won't do anything.Comment is buried, click here to see the rest.
Money is real and so too are shares in a company. One can be changed into the other at any given time assuming there is both a buyer and a seller. It affects your bank account when you buy because your bank account will have less money but your assets will be more or less depending on if you can sell it for more or less than you bought it for.
This is common sense and making a stupid assertion like it's ignorant to believe a share in a company has monetary value is more than ignorant, it's a statement of a bafoon..
Tool. I don't see a broken capitalist system fixed. Which means it will just happen again.. in time. You people are so f**king gullible it is disgustingComment is buried, click here to see the rest.
Not so fast. He has a good point. What has changed to keep this from happening again? Do you support continuous pouring of taxpayer money into corporations?
And no, I don't generally support bailouts at all. As I said in another comment, though, these were extraordinary circumstances. The economic crisis would have killed the entire banking and automotive businesses had the government not stepped up. We'd be much worse off today had they not been bailed out.
- 4 engine misfires
- 2 steering clunks
- 2 sunroof leaks
- warped brake rotors
- water leaking into the driver side door
- transmission shifting problems severe enough to require a transmission flash
- faulty seatbelt buckle indicator (it would be buckled, but it didn't think it was, so it would constantly beep at me)
Total piece of garbage. I even had to get involved in my state's lemon law arbitration to try and get some compensation for it.
I had two Saturns. A 1997 SL1 and a 1999 SL2. There we a few weird quirks with each, but nothing serious. Though they were economy cars, I liked them both. They got the job done.
You should at least give them a test drive or two. Their cars have improved considerably. The Cruze and Malibu are supposed to be great. And, of course, the Volt, but I'm biased there.
And this is why a capitalist should never be for bailouts. You may want to "vote with your wallet" to influence the market by not buying GM because they make crappy cars, in your experience. Yet, you are circumvented, along with the fundamental nature of capitalism itself by bailouts that revive these failed companies, who deserved to go under like any other company who doesn't meet the satisfaction of their customers. How else can a free market work?Comment is buried, click here to see the rest.
Decent post but the product started to improve a few years before they were bailed out. Particularly look at the second generation Cadillac CTS and the Buick Enclave, both of which were debuted in 2006 and have been roundly praised by the automotive press.
I think it goes to back to the hiring of Bob Lutz in 2001. It takes a few years to bring a car to market. The bailout sped them toward financial health but without good cars none of this would be possible and GM does have a few really good cars right now.
Another thing - related topic - Ford got praised up and down for not needing a bailout but if you follow the industry at all you ought to remember that they restructured themselves in bankruptcy just a few years prior. They weren't the one left standing - rather they were the first to fall.
Correcting myself - they escaped bankruptcy in 2006 in spite of record losses.
In December 2006, the company raised its borrowing capacity to about $25 billion, placing substantially all corporate assets as collateral to secure the line of credit.[18] Chairman Bill Ford has stated that "bankruptcy is not an option".[19] In order to control its skyrocketing labor costs (the most expensive in the world), the company and the United Auto Workers, representing approximately 46,000 hourly workers in North America, agreed to a historic contract settlement in November 2007 giving the company a substantial break in terms of its ongoing retiree health care costs and other economic issues. The agreement includes the establishment of a company-funded, independently run Voluntary Employee Beneficiary Association (VEBA) trust to shift the burden of retiree health care from the company's books, thereby improving its balance sheet. This arrangement took effect on January 1, 2010. As a sign of its currently strong cash position, Ford contributed its entire current liability (estimated at approximately US$5.5 Billion as of December 31, 2009) to the VEBA in cash, and also pre-paid US$500 Million of its future liabilities to the fund. The agreement also gives hourly workers the job security they were seeking by having the company commit to substantial investments in most of its factories.
The automaker reported the largest annual loss in company history in 2006 of $12.7 billion,[20] and estimated that it would not return to profitability until 2009.[21] However, Ford surprised Wall Street in the second quarter of 2007 by posting a $750 million profit. Despite the gains, the company finished the year with a $2.7 billion loss, largely attributed to finance restructuring at Volvo.[22]
Actually, I live in the Detroit area, and the jobs have been returning for a little over a year now. The auto industry recovery is definitely turning things around in Mi. It still has a way to go, but things are at least in the right direction.
They ended up not selling the stock that year in hopes that it would improve. According to the article, analysts think it will. And the profit announcement seems to favor that conclusion as well.
The article I posted was older but the problem with the GM profit is it's based on a pledge that European sales will increase. In January, industry auto sales in the top 19 European markets fell by 7.2%. If the pledge is not meet GM stocks will crash back down next time.Comment is buried, click here to see the rest.
wow look at the cheerleaders for failure in this thread! do you f**kers WANT all your future products to be made in china? only if you can blame it on Obama though right?
what about the words "the largest profit in its 103-year-history" don't you naysayers understand?
That record profit was fostered on the backs of the American taypayers and communities left with the repercussions of GM's poor decisions and Obama's pandering to the unionized voters.Comment is buried, click here to see the rest.
Its amazing what you can do when the Government rides in and fixes your debt problem for you...
"Before entering bankruptcy on June 1, 2009, GM had $54.4 billion in debt and owed an additional $20 billion to a retiree health-care trust managed by the United Auto Workers. GM had $88 billion in losses from the end of 2004 until going into bankruptcy.
GM now owes $15.6 billion in debt and preferred stock and $9.4 billion in underfunded retiree obligations. "
Although you might feel differently if you were a GM bondholder and got screwed...
"Its amazing what you can do when the Government rides in and fixes your debt problem for you..."
--Even more amazing when you're the most profitable industry in the history of industries--and the GOP still fights tooth and nail to give you billions in subsidies, huh? ;-P
So, the American people get to take the risk but don't get to share in the rewards? Hey GM, how about a little gratitude for bailing out your poor business practices?
Here are some of the rewards you share as an American:
- lots more of your fellow Americans have jobs because GM is still in business today.
- even if neither you nor anybody in your family works for GM or any of their hundreds of suppliers or auxiliary businesses, those people who have those jobs today are paying taxes. This helps the economy.
- since they have jobs, they're not drawing unemployment assistance or other forms of welfare. This helps the economy.
- those people who have jobs today have money to spend; they might spend on a product or service that you provide, or help provide. This helps you.
What else do you want? A free car?
The US also pays $20B a *year* in farm subsidies. Your reward as an American is a wide selection of safe, healthy and inexpensive produce and, of course, all the same benefits that our society receives when more people have a chance to work. It does not entitle you to a free fruit basket.
watching other people get govt benefits that the rest of us don't get just isn't that fun
while I know you'd like to extend your taxpayer-funded credit card to all of us - big spender that you are - the fact is that's not sustainable eitherComment is buried, click here to see the rest.
Lower unemployment, less expenditure on welfare, and higher tax revenues help *every* American.
For every dollar that the government spends, there are going to be some direct beneficiaries, and lots and lots of indirect beneficiaries. That is simply the way the economy works:
- The department of agriculture's budget helps farmers.
- The department defense's budget helps military contractors, as does the DHS budget.
- The budgets of the DEA, Department of the Interior, and the dozen or so other departments help a wide variety of private enterprises.
If you narrowly define a "free handout" as employment in an industry that relies in some part on government funding... believe me, you have your choice of *plenty* of industries in which to go find a job.
But if you don't want to, that's fine -- you can simply enjoy the societal benefits that they bring to everybody.
there's a huge difference between jobs that are NEEDED and jobs that are NOT NEEDED, but are artificially created just to give somebody a paycheckComment is buried, click here to see the rest.
While I agree with most of what you say AND with the GM bailouts, I do not agree in the farm subsidies. The subsidies only go towards big agribusiness, and the only reason they get them is so that they can sell their produce cheaper than small or local farms can afford.
Monsanto owns like 90% of most US crops and is a multi-billion dollar industry, yet it's still subsidized. Why? Because without subsidies, Monsanto crops would be more expensive than non-genetic-engineered crops, and Monsanto has lobbied extensively to make sure its crops keep getting subsidized.
So by your statement I would assume that you think the banks should be helping out the average American since we also bailed them out for their poor business practices?
Just look through the replies on here. There are plenty, bringing up old facts, and false claims. Don't worry, they haven't shut up yet. As long as Fox news is feeding them new BS, they'll be there regurgitating it.
This is a great news story, but I'm still a little concerned that we're building too many cars generally. We still need cars, but with high fuel prices and climate change we should be trying to slowly wean ourselves off this unsustainable form of transportation. Until we retool some of that extra manufacturing capacity to more sustainable uses, we should keep the cheerleading to a minimum.
That's called the broken window fallacy. Consumer money to buy vehicles would have just gone to other manufacturers and their employees, who would pay taxes.
For all of you bitching about bailouts, here's a question for you. I see many of you are pissed, about a company that took a LOAN from the government, and has turned around to become successful again, and rehire employees. Yet you don't seem nearly as pissed that the banks were just GIVEN cash that the government will never see again. Why is that? Is it simply because Obama is attached to it, and you can't possibly like anything he does?
Can any of you actually make a valid point without claiming someone is an Obama lover, or a liberal, or some other weak attempt to insult people? You must live a very lonely, hateful life. I imagine you're a blast at parties. Every discussion turns into a hateful Obama rant I'm guess. That's if people still invite you to parties, after being tired of hearing your rants.
Easy to do after firing their idiotic management. Don't forget that GM management bought Hummer thinking everyone would want ridiculous gas guzzling behemoths long into the future.
2002 was the year the Bush administration added a tax law that allowed deductions of up to $80,000 for an SUV needed for work. A knew of a company that used that deduction to get a Hummer for their electrolysis business.
As you can see, as soon as gas prices soared the Hummer brand died.
Don't forget that Hummers were GM's best selling cars (along with SUVs and large trucks) right up to the spike in gas prices. Their "economy" cars were NOT selling... even AFTER the spike.Comment is buried, click here to see the rest.
GM cars were not selling after the spike in gas prices because GM had spent NO MONEY developing fuel efficient cars. They foolishly thought that people would buy 10 to 12 MPG SUVs and large trucks forever.
Toyota and Honda owned the fuel efficient car market when gas prices spiked. GM management failed the company completely.
That's almost enough to offset their 2005 losses ($10.6 billion). Of course it would take 4 years like this one to offset the $38.7 billion they lost in 2007.
Wow what a surprise? Now I understand why they cut the pensions, benefits, and other financial resposibilities to their employees which worked twice as hard to bring them back from fictional financial ruin. To big to fail huh!!!!! Business as usual since they went bankrupt. We deserve what we get because we have nobody to blame but us........
So instead of using the profits to find ways to increase the stock value and helping the taxpayers get their money back, they're giving bonuses to union workers. Oh that's right, this is an election year and Obama needs the unions to force, I mean encourage their members to vote for him.Comment is buried, click here to see the rest.
@griberal5:
"So instead of using the profits to find ways to increase the stock value and helping the taxpayers get their money back, they're giving bonuses to union workers. Oh that's right, this is an election year and Obama needs the unions to force, I mean encourage their members to vote for him."
I remember a time, at least 20 years ago, when a company that did well rewarded its employees, not just its executives.
"These are the values inspiring those brave workers in Poland ... They remind us that where free unions and collective bargaining are forbidden, freedom is lost." --Ronald Reagan, Labor Day Address at Liberty State Park, 1980
Can you look at the big picture? The company was bankrupt, the union was already there. Would you rather have a labor issue right after the bailout? We're talking about a 7k(at most) bonus to 19k workers... that's around 133 million dollars maximum. It's called profit sharing and it's what any decent company should do with their employees.
Yeah. Those profits should only be going to the rich executives. How dare the people who actually do the work for the company expect to share in the company's success?
i guess operating in the US without all the waste and redundancy isn't so bad after all. pfft, who are we kidding. time to open a new plant in china!
oh wait, that's exactly what they're doing after being bailed out by the US gov't.Comment is buried, click here to see the rest.
FTA: "Sales of GM-branded vehicles by GM and its Chinese partners rose 8.3 percent in 2011 to a record of 2.5 million vehicles."
I'm for local production. It makes sense to make stuff in America for Americans, and in China for Chinese, rather than ship things overseas on burn fossil fuels.
I think the US needs to tie labor laws to trade agreements with China, but that's another issue.
GM sells vehicles all over the world, even China. It's not uncommon to open a plant in the country you plan to sell in. Japanese and German auto companies build many of their cars on American soil with American workers. It's cheaper than shipping them overseas.
i guess i should expand on my original statement because i was looking farther into the future than the simple don't go to china argument. i never said that having a plant in china was a bad thing, because it does make perfect sense from a business standpoint to build where you're selling. but one of the reasons they are building another plant is because current plants, including those in the US, are working above normal capacity. once the new plant is open the plants here won't have to operate at the same 'excess' level and some jobs will probably be lost. it's obviously a win for GM and the stock that the US gov't still holds, but the potential for some job losses and the big loss in not creating more jobs in the US is more what i was going for.
I wanted to go back and change my first post after reading some of the other comments to not fall into the same category, but since the edit time expired I hoped it'd go overlooked. It's good news for a great American company to become more successful. Especially since the knock on GM and Ford was always that Toyota, Honda, etc. could expand and sell well overseas, but they couldn't. Hopefully it reaps rewards for all of their plants and maybe more jobs or better pay will be seen in the States instead of my original negative outlook.
Right, and Buick is the biggest selling car in China.
I am not sure if Buicks are built there or not, and if they are, is that called an import in China or not?
China plays this game with us. They get very low import tariffs from us and unless they have partial ownership of the manufacture of a product, you see heavy import tariffs. The US represents 18% of all of their exports and only 7.5% of their imports(CIA World Factbook). We just need to re-evaluate the tariffs we impose on imports. Anyways, there would be no way to compete in China unless you manufacture in China... that's just the way it is. Take a look at this story to get an idea as well: http://moneyland.time.com/2011/12/14/u-s-very-disappointed-by-chinas-new-auto-import-tariffs/
So like, since the president is all about making the rich pay their fair share, could he ask his buddies and campaign contributors at GE if they could maybe pay some taxes this year? Pretty please?Comment is buried, click here to see the rest.
He's trying? Please direct me to the WH policy paper outlining his plans to institute a level, flat corporate tax rate without loopholes.I must have missed the release.Comment is buried, click here to see the rest.
Not everyone agrees that a flat tax is a good thing. The whole point of different taxes is to promote industries that are better for public good or growth in the direction the country should take (say, high tech, green energy, etc) and impose penalties for companies whose nature is against the public good (heavy polluters, outsourcers, etc).
No, the tax reforms I'm talking about is making it so that people like Romney, who make millions, don't pay a smaller % of taxes than the hardworking middle and lower income earners.
You are woefully misinformed. The corporate tax is already flat, except in the sense that it allows big, wealthy companies to avoid paying a lot because of all of the loopholes. Meanwhile small businesses get hammered.
I'm not sure how you can say corporate tax is flat - there's a host of tax breaks and subsidies for businesses of all sizes. And yes, larger businesses also have loopholes, but most of them are things like, "Hey, we just opened a ghost office in a country with low taxes." How do you propose we close that loophole without having the World Bank or International organizations complaining that we're "unfairly trading?"
Such is the result of Reagan through GW Bush's trade politics. (including Clinton)
The fact that there are loopholes has no bearing on the fact that it's a flat rate. Every business should be paying the same rate, if you indeed care about fairness.
I know you are probably joking, but many do not understand why GE did not pay any federal income tax last year, and this tends to fan the flames of ignorance.
Like other businesses, GE will pay federal income taxes when they turn an overall profit which meets the federal requirements for tax. The reason they did not pay federal income taxes lately is that one of their 4 divisions, GE Capital, had a large loss, which meant that GE overall did not have a profit to pay tax on.
GE has always paid taxes according to the tax laws like other businesses, and will be happy to pay tax when their business shows a profit to pay tax on. They would more than welcome that, and so would their shareholders.
GE reported worldwide profits of $14.2 billion, and $5.1 billion of the total came from its operations in the United States in 2010.
Zero US income taxes for a company which made over $14 billion...that's fact.
The NY Times reported that:
"A review of company filings and Congressional records shows that one of the most striking advantages of General Electric is its ability to lobby for, win and take advantage of tax breaks.
Over the last decade, G.E. has spent tens of millions of dollars to push for changes in tax law, from more generous depreciation schedules on jet engines to “green energy” credits for its wind turbines. But the most lucrative of these measures allows G.E. to operate a vast leasing and lending business abroad with profits that face little foreign taxes and no American taxes as long as the money remains overseas."
GE avoided paying taxes through its use of loopholes it lobbied for, and used it's financial muscle (and TV networks) to help President Obama get elected to further them. Indeed, President Obama appointed CEO Jeff Immelt to head his economic advisory board.
Under Immelt's leadership, GE also laid off 21,000 American workers and closed 20 factories between 2007 and 2009. More than half of GE's workforce is now outside the United States.
The profits, or the profits which would have incurred federal income tax, were obviously offset by losses at GE Capital.
Like you said, they did nothing illegal, and their returns have probably been audited.
As of January, 2012, the US government's Troubled Asset Relief Program had about $25 billion invested in GM. Break even for the government was figured at $53.98 v. the then-current share price of about $25.[25]
@number23
Someone who uses Wikipedia as their primary source material for an argument has little credibility for arguing facts. And using terms like "f**k-face" just makes you look like a man-child that should have been aborted before birth.
First of all, swearing just takes away from any point you make.
Secondly, investment is different from bailout loans.
Thirdly, if you look at the broader picture:
- GM pays taxes on its revenue
- GM employees still have jobs and are spending their money in our economy, as well as income taxes.
- Literally an entire industry was saved from risk of going kaput to once again being the #1 in the world.
This is well past being paid back. And that the US Gov will make more money on stock sales as the price rises, consider that investing in a company when its stock price has dropped significantly, and it has been backed by government dollars - that's a pretty decent start for criteria on a good investment.
So yes, you can take one isolated fact and use it out of context, and then swear at me like a 13 year old. But that doesn't make me stupid or my point less valid.
GM is a monument to poor business practices. For decades they produced gas guzzling, haphazardly built, poorly designed s**t. Even today as gas sky rockets past $4 a gallon they busy producing 600hp Corvettes, Camaros and Cadillacs that struggle to achieve MPGs in the low teens.
No sane investor would put a dime in GM. let alone 25 billion. If we had burned the money in a big pile, at least it would have kept us warm a while.Comment is buried, click here to see the rest.
"Each Chevy Volt sold thus far may have as much as $250,000 in state and federal dollars in incentives behind it — a total of $3 billion altogether," according to an analysis by James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy. This is not counting the cost of bailing out GM itself.
They build the Corvettes, Camaros, and Cadillacs, because people buy them. That's GOOD business practices. Should they stop selling cars that they are making money on, because you don't like the gas mileage they get? Hell, the Corvette still gets better gas mileage than most trucks on the road, and many of the cars.
The argument that they are poorly built cars, is a tired and old argument. That's a reputation they built for themselves in the 90s, when agreeably, they were bad. In the recent decade, there has been a lot of focus on the build quality, and they are on par with most other manufacturers.
And show me a manufacturer that has anything to compete with the Volt. Don't show me a hybrid, because I can get a diesel powered Jetta that gets better gas mileage. Show me an electric car, that elevates the fears of running out of power on the drive home.
wtf don't you understand. They borrowed ADDITIONAL TARP money to pay back the loan genius. Talk about being a kool aid drinking Obama TOOLBAG. You personify the definition.Comment is buried, click here to see the rest.
WHARRGARBL! This has absolutely nothing to do with Obama. You're the personification of the typical Fox Noise / conservative blog kool-aid drinker. Derp. Take a Xanax, clown.
WTF don't you understand about all the loans being paid off? The received loans in December 2008, then again in 2009. All of these loans are paid back. The only "debt" they have left is stock which the US government owns. They don't have to pay that back. Either the government sells it at a loss or waits until it reaches $53/share.
pc, you aren't reading all of his words. You are saying that they took a loan to pay off the other loan. Crom is trying to tell you, they paid off BOTH of those loans.
So sure, it's like using a visa to pay off the mastercard... THEN paying off the visa with your paycheck.
If you're going to debate with someone, read what they post.
The bottom line seems to be that the TARP loans were “repaid” with other TARP funds in a Treasury escrow account. The TARP loans were not repaid from money GM is earning selling cars, as GM and the Administration have claimed in their speeches, press releases and television commercials. When these criticisms were put to GM’s Vice Chairman Stephen Girsky in a television interview yesterday, he admitted that the criticisms were valid:
Question: Are you just paying the government back with government money?
Mr. Girsky: Well listen, that is in effect true, but a year ago nobody thought we’d be able to pay this back.
Mr. Girsky then said that GM originally planned to pay the loan over the next five years. So the question is why—other than a desire to justify excluding GM from the administration’s TARP tax proposal—would Treasury and GM reduce GM’s TARP debt with TARP equity and then mischaracterize it as a repayment from earnings? Accordingly, please explain:
1) Your department’s justification for allowing GM to use funds from the TARP escrow account to repay TARP loans,
2) The amount of funds remaining in the TARP escrow account at Treasury that may be released to GM, and
3) The date that you anticipate that the remaining funds in escrow will be released to GM.
you need to check you own chart. From the close to $50 billion that was lent to GM only $361 million was paid back. Talk about being willfully ignorantComment is buried, click here to see the rest.
What about all the suppliers and prior shareholders who were shafted by the Obama arranged bankruptcy? The communities hollowed out and left holding the bag on the environmental disasters GM walked away from with the blessing of the administration?Comment is buried, click here to see the rest.
By his own Auto Czar's admission, the GM bail out was done " all for the unions", a reliable democratic constituency. Add to this the reporting emerging now that those connected to the administration were channeling billions in to "green energy" investments (most of which have or are failing) that they had a personal stake in AND their attempt to undermine 2nd amendment support by fomenting border violence by suborning illegal gun trafficking and you have. what could be politely describe as, the most brazenly corrupt administration in one hundred years.Comment is buried, click here to see the rest.
I find it ironic how anti-Obama people are pro-union when it comes to criticizing the auto bailout, but staunchly anti-union in every other instance.
Guess what? Most investments, in general, fail. Only 1 out of 10 new ventures succeed. That's how investing works; the ones that succeed make up for the ones that fail. Meanwhile, China is spending an order of magnitude more money on green energy research than the US. We can keep up with tech, or we can lose to the inevitable future of green energy.
"I find it ironic how anti-Obama people are pro-union when it comes to criticizing the auto bailout, but staunchly anti-union in every other instance."
What? I was and am and will be opposed to bailing out failed corporation and their parasitic unions.
I admire your enthusiasm, but I think you're tilting at the wrong windmills:
"Add to this the reporting emerging now that those connected to the administration were channeling billions in to "green energy" investments (most of which have or are failing) that they had a personal stake in"
Citation on the "most of which have or are failing," please.
You are correct that with many of the DOE investments, lines can be drawn to infer personal stakes, but this is hardly tied to this administration.
Remember, the Solyndra loan guarantee program was kicked off during the Bush administration, in 2007, as part of 2005 legislation. One of Solyndra's earliest and largest investors was Madrone Capital Partners, which is funded by the Waltons of Wal-Mart fame -- a family that's donated millions of dollars to Republican candidates.
Did the Bush administration pursue Solyndra because of the Walton connection? You can infer that; I'm not so sure. I think it's more innocent than that; it was many loan guarantees that was created by the Bush administration as a result of the Energy Policy Act of 2005. Were some big GOP donors invested in energy? Sure; Bush was a very energy industry-friendly president. But your suggestion that this policy was driven by favoritism? I disagree.
"AND their attempt to undermine 2nd amendment support by fomenting border violence by suborning illegal gun trafficking and you have. what could be politely describe as, the most brazenly corrupt administration in one hundred years."
Again -- it's good to be suspicious, but your facts are a little mixed up. The ATF gun walking operations began in 2005; they're simply something that the current administration continued. Should the new administration have put an end to this Bush-era program? Perhaps.
But your charge that the Bush administration launched the operations to undermine 2nd Amendment support is patently absurd. Look -- Bush may have made some bad choices about the economy. He may have mispronounced a few words here and there. But accusing him of being anti-2nd Amendment? Listen to yourself.
Wrong. "Gunwalking" began and ended (2006-2007) under Bush but was started again, in earnest, by Obama (though no one seems to know anything about...) and a border agent died as result.
The "gunwalking" method of Operation Wide Receiver (2006-2007) was questioned at ATF HQ by Acting Director for Field Operation William Hoover and the operation terminated by Phoenix ATF SAC William Newell 6 Oct 2007 after Mexican police failed to interdict gun traffickers after they crossed into Mexico.[11] Gunwalking under Operation Fast and Furious (2009-2010) without involvement of Mexican law enforcement was first questioned by the ATF field agents[12] and the licensed gun dealers[13][14][15] cooperating with them. Under Fast and Furious, dissident ATF field agents expressed their concerns to Congress after the death of Border Patrolman Brian Terry.[16][17]Comment is buried, click here to see the rest.
It was not Obama's idea to do "gunwalking". At the same time, do you expect the President of the United States to micromanage every government agency? Does authorizing FBI / DEA / ATF operations need to clear the President's desk?
It was a stupid idea and the people responsible are gone.
So they begin a policy which results in a dead border agent and nobody seems to know anything about it?
Nothing to see here... move along...
And by the way, just happened to coincide with statements from Dear Leader that "[m]ore than 90 percent of the guns recovered in Mexico come from the United States"Comment is buried, click here to see the rest.
So Dear Leader is running around claiming that American guns are fueling Mexican gun violence at the same time he's supplying guns that fuel Mexican gun violence and you think it's just a coincidence?Comment is buried, click here to see the rest.
Both Wide Receiver and Fast and Furious were major operations of the umbrella Operation Gunrunner, which has operated continuously.
Both operations were equally risky, and, as argued by many, equally counterproductive. Sure, 1,400 people were arrested over five years, but at what cost? Besides the death of Brian Terry, how many guns got into the hands of drug lords, and were then used to kill untold people?
My point stands: Fast and Furious certainly wasn't launched as a covert attempt to weaken the 2nd amendment, and neither was Wide Receiver. Frankly, if I lived on the border I might be *more* inclined to buy a weapon if I felt that more south-of-the-border outlaws were packing heat thanks to Operation Gunrunner. Your assertion is straying into tinfoil hat territory.
The loans are paid back. They aren't required to pay back stock purchases. The government will (ideally) hold onto the stock until it reaches parity (or profit) and sell it.
Good Lord are you stupid. GM stock price has to nearly f**king double just for the taxpayer break even. What the hell do you think that's going happen?Comment is buried, click here to see the rest.
I agree with you, but it won't happen during this administration (or the next one) because it's a a political third rail. It tacks a hard number to the loss on the stock sale, which will be bandied about by the administration's opponents -- even though the cash from that sale would be actual, hard cash that would go toward reducing the deficit.
The investment in GM was a good one, and it will continue to pay back by helping the economy, regardless of whether the Treasury Department continues to hold shares. I believe GM will hit $50 a share sooner or later, but I'll bet that the Treasury will ultimately make more money if it sells its stake and uses the cash to pay down debt.
@shark72 The US is on an interest-only payment scheme. It won't get paid towards the debt, only less will get added to it. Debt isn't a bad thing but when it's pushing 100% of GDP like it is now...
Drawing a distinction between outright loans and stock purchase is stupid.
The fact remains billions of American taxpayer money was given to a failed corporation, who, for decades produced shocking poor products and was a study in failed management practices, and that money will never be recovered.Comment is buried, click here to see the rest.
Again, the opportunity cost of money.
When you take your money out of a losing investment, and place it into a winning investment, your gains will usually be much higher. In addition, there is always a good chance that a losing investment will get worse and you will lose even more. It is usually only a person's ego which drives them to try to "get back to even" on a particular investment.
Another way to say this is: If someone came to your door today, and gave you $10,000 to invest in a company, would you put it into GM? Or would you put it into one of the other 8000 stocks, many of which are solid, growing investments?
Before the bankruptcy, GM's stock was typically $50+, and at one point, peaked over $90. When things are rolling again, the government will have no problem getting their money back. It's already gone up to $27 since this news hit.
The GM loans, and stockholder investment in the company, are separate things. It is correct that the loans have been paid back. You are also correct that the US and Canada governments are shareholders.
I agree with you that the US Treasury won't see break-even on GM's stock price for at least few more years of earnings numbers like these. However, GM's continued operation provides a boost to the economy that offsets this investment.
Oh gee, it's raining money - today - so I guess it's time to sign ridiculously inflated wage agreements with the unions, and lifetime job guarantees, and guarantees for jobs for their kids, and their pets, and their extended cousins. So that some illiterate moron can get paid $80K for shifting a car from ParkingLot A to ParkingLot B, while proudly beaming at how this is all good for the middle class.Comment is buried, click here to see the rest.
"so I guess it's time to sign ridiculously inflated wage agreements"
Typically you don't harp on long-ended company practices, particularly if the old CEO was retired (by "request" of the majority owner) and replaced by a new guy who had never worked in the company before, but if you really have nothing better to complain about I guess you can go full assh**e and work over the past. (Let me guess, you're not friends with any of your ex'es are you?)
"So how much of that goes to the American people since we are part owners?"
That's actually a good question. You can estimate it by adding some numbers:
- your estimate of the taxes GM will pay on that $9.2B net profit
- the money kept in the economy because US consumers had more options for purchasing vehicles from a US company
- the taxes paid by the people who have jobs today due to the GM bailout
And then accounting for:
- the money saved that would otherwise have gone to support unemployed auto workers (unemployment, SNAP, etc.)
Many people, of course, are still angry about the bailout. They argue that with unemployment the way it is and with so many of our manufacturing jobs going overseas anyway, what difference does it make if X many more people are unemployed, or we lose another industry? The rationale here is that the government will always be there to support our unemployed workers if it's not willing to do what it takes to support our industries.
I disagree -- I think America is at its best when we're a nation of workers, not a nation of people relying on government assistance. But that doesn't always happen magically -- sometimes, the government needs to make the necessary investments to keeping the engine of our economy going. Money spent giving people an opportunity to work is generally a better investment than money spent to allow people to survive because they're not working.
We do have to do both -- times are tough and we need those social safety nets -- but ultimately, it's a smarter choice to help private enterprises put people to work, than it is to admit defeat and spend more money on the safety net.
"your estimate of the taxes GM will pay on that $9.2B net profit"
So, the government takes money from tax-payers, gives it to GM and now GM gives it back to the government to squander... splendid!
"the money kept in the economy because US consumers had more options for purchasing vehicles from a US company"
In a world without GM and Chrysler, consumers would still have plenty of options (perhaps more). Furthermore, forcing a company to restructure due to poor management does not infer total collapse. Finally, our American automakers source the far majority of the parts and some assembly in Mexico, Canada and overseas; so, the bulk of the money isn't returning to local economies. In contrast, foreign automakers like Toyota actually manufacture about 80% of their vehicles here in the U.S.
"the taxes paid by the people who have jobs today due to the GM bailout"
Again, the bailout was financed by tax-payers. Laundering the money through the tax system does not provide any net gain to the people who unwittingly assumed all the risk.
Ultimately, government bailouts mean rewarding companies for gross mismanagement, which is wrong. Ford decided to take a more traditional route for restructuring and they're prospering as well.
"So, the government takes money from tax-payers..."
Not per se. Taxes have generally been going down, between the Bush/Obama tax cuts, the payroll tax cuts, and other Recovery Act tax cuts. Taxpayers *aren't* paying for this (or, arguably, anything), because we have a deficit. The government is spending money it doesn't have. The rationale is that making the right investments will yield a positive return, and ultimately reduce the deficit.
This was the original rationale for the Bush tax cuts, as well -- it was known that the reduction in the tax base was unsustainable on its own, but the theory was that it would grow the economy and, ultimately, the tax base. However, we know how well that worked out.
"In a world without GM and Chrysler, consumers would still have plenty of options (perhaps more)."
You are correct, but if it's all the same, I'd rather have those buildings in Detroit be American-owned. It's bad enough that Fiat took a stake in Chrysler. Several Chinese automakers were lining up to buy GM's assets had they gone under. Would lots of Americans been perfectly happy buying their Chevrolets if the money were going to China? Sure thing. But I'm glad we avoided this.
"Again, the bailout was financed by tax-payers. Laundering the money through the tax system does not provide any net gain to the people who unwittingly assumed all the risk."
The numbers on our 1040s would have been the same had the Treasure department invested that money elsewhere. The risk is ultimately the size of the deficit, and not taxpayers' bottom lines. A larger deficit is, of course, bad, but some are painting this like each of us had to skip that vacation this year to write a check to GM for $500. It doesn't work that way.
Will there ultimately be a net gain to the people? There are a lot of moving parts here, but I strongly believe that this will be a net positive for taxpayers, as we'll get to enjoy the many rewards of a stronger economy.
"Ultimately, government bailouts mean rewarding companies for gross mismanagement, which is wrong. Ford decided to take a more traditional route for restructuring and they're prospering as well."
I agree. Contrast the Chrysler bailout of the 1980s to the GM restructuring, in which the government took a significant larger role.
Chrysler got to where they were by making crappy cars and relying on patriotism to move inventory, and emerged from the bailout with the K car, yet another crappy car. GM fixed some very basic practices, and their vehicles -- while not worldbeaters -- are significantly better now.
Interestingly, Fiat went through a similar cycle decades ago. Propped up by Italy's protectionist trade laws, they were allowed to make really, really bad cars for a long time. When the situation changed and they were forced to compete on the world market on quality, their cars got better -- and now they own part of Chrysler.
"So, the government takes money from tax-payers, gives it to GM and now GM gives it back to the government"
Yes, that's generally how any government funded company works. It's also how any tax break works. However, that money gets spent several times over and fuels the economy.
"In a world without GM and Chrysler, consumers would still have plenty of options "
... of non-American brands. This is about the US not exiting from the auto industry, above all other things.
"Furthermore, forcing a company to restructure due to poor management does not infer total collapse."
I believe the word you mean is "imply", not "infer".
"Finally, our American automakers source the far majority of the parts and some assembly in Mexico, Canada and overseas"
This is true, and a result of bad trade agreements made without consideration of fair wages of foreign countries. However, please cite source for this: "so, the bulk of the money isn't returning to local economies." - while bulk of manufacturing of parts may be foreign, where are the numbers to show that the bulk of income is thus passed along to foreign countries?
"Again, the bailout was financed by tax-payers. Laundering the money through the tax system does not provide any net gain to the people who unwittingly assumed all the risk."
The whole economy is, as you say "laundering money". Money goes around in cycles. The more the money moves, the faster our economy is. That's macroeconomics 101. That's why things like the TVA helped the US out of the Great Depression. Ultimately, cutting taxes also provides growth to the economy, as it frees up money for companies to spend; however, if those companies are about to go kaput, like GM was, then all the corporate tax cuts in the world wouldn't help.
When exactly did the government take money from tax payers? Taxes have not gone up in the last decade. They allowed themselves to go further into a deficit to buy up shares of GM.
If GM rebounds and increases their share price above what the government paid for it, then they would profit and the money would go to reducing the deficit they created in buying the shares.
Its called an investment and it looks like its paying off.
The government doesn't generate income - it either takes it from tax-payers or simply prints the money it needs, which is even more egregious. You see, when you're working with a currency that has no intrinsic value, like the dollar, the monetary value is determined by the number of dollars in circulation. When the Federal Reserve creates a trillion new dollars, every dollar you and I have reduces in value, respectively. The inflation tax is by far the largest, most insidious tax on the American people.Comment is buried, click here to see the rest.
Since the US owns stock in GM, 33% is the figure quoted by some of the others in this thread, I imagine we'll get a dividend. Still this is proof that the auto bailouts saved the company, and we didn't throw good money after bad as you claimed back then. Sometime in the next few years the US will be able to start selling it's stock putting us in the black for this investment. considering the manufacturing capabilities, and jobs saved I'd probably say we already have seen a net gain on investment.
In regards to Ford, the article states: "this loan was not a bailout."
Nevertheless, the government shouldn't be playing corporate lender with tax-payer money. I'm even more appalled to see they loaned billions to BMW and Toyota too! :(Comment is buried, click here to see the rest.
I don't consider loans to be bailouts, either, but some people around here do. It's important to note that for those people who think any government intervention is evil.
Given the historical context, an economic crash and credit freeze, I don't have any problem with what they did. We'd be in far worse shape than we are now.Comment is buried, click here to see the rest.
GM made terrible products with terrible design, used "planned obsolescence" to try to sell more cars while Honda & Toyota were creating made to last quality automobiles, and overstretched their brand ownerships when they bought the SAAB brand. None of that has anything to do with unions.
Some of these people are saying "I'm only buying from Ford now..." or some such nonsense, ignoring that Ford also took government loans and uses union labor.
Yes, lets companies decide how much or how little to pay their employees and how many or how few benefits they decide to offer. That worked out well for the 1940s
The question we should be asking is where this huge profit came from. If they earned it fair and square then more power to them, but I don't see how it's possible with the recession. Hopefully they didn't cut spending on quality control in order to get this profit, or they were hiding money away we never knew about.Comment is buried, click here to see the rest.
And their European division turned in "horrendous numbers".
GM said Thursday that it lost $562 million on its European operations during the fourth quarter.
Get us U.S. and Canadian taxpayers out of this company!Comment is buried, click here to see the rest.
IBM or Apple are good examples, but that is not the point.
The loss in the European division was called "horrendous" - it was over a half a billion dollars, which is shocking. That is $1,400 loss per vehicle! Here is a good article on the loss: http://tinyurl.com/7vtjpev
All we can hope is that you are not running a company or any part of one, because your board and stockholders would fire you immediately if you told them "Tis the nature of business and investment. Not everything makes money. No risks, no gain".
Furthermore, Exhibit 99.1 of the Form 8K filed by GM with the SEC on November 16, 2009, seems to confirm that the source of funds for GM’s debt repayments was a multi-billion dollar escrow account at Treasury—not from earnings. In the 8K filing GM acknowledged:
Of the $42.6 billion in cash and marketable securities available to GM as of September, 30, 2009, $17.4 billion came from an escrow account with Treasury,
$6.7 billion of the escrow account available to GM was allocable to the repayment of loans to Treasury,
$5.6 billion in cash would remain in the Treasury escrow account following the repayment by GM of their loans, and
Upon repaying Treasury, any balance of escrow funds would be released to GM.
Therefore, it is unclear how GM and the Administration could have accurately announced yesterday that GM repaid its TARP loans in any meaningful way. In reality, it looks like GM merely used one source of TARP funds to repay another. The taxpayers are still on the hook, and whether TARP funds are ultimately recovered depends entirely on the government’s ability to sell GM stock in the future. Treasury has merely exchanged a legal right to repayment for an uncertain hope of sharing in the future growth of GM. A debt-for-equity swap is not a repayment.
This supports what I'm saying. GM received TARP money in two forms: loans and stock purchases. They paid back the loans (which essentially was just giving back the loans given to them in the first place), but the stock is still outstanding. The link I posted in my previous comment backs this up. The stock purchase isn't considered a loan that GM has to pay back. The claims that the loan were repaid are based on the loan portion of the TARP funds, not the stock purchase.
Therefore, it is unclear how GM and the Administration could have accurately announced yesterday that GM repaid its TARP loans in any meaningful way. In reality, it looks like GM merely used one source of TARP funds to repay anothe
it's using your master card to pay off our visa card.
Furthermore
The taxpayers are still on the hook, and whether TARP funds are ultimately recovered depends entirely on the government’s ability to sell GM stock in the future.
During an April 20 hearing on Capital Hill, Sen. Tom Carper, (D-Del.) asked some pointed questions of Neil Barofsky, the “special watch dog” on the Wall Street Bailout, aka, TARP.
“It’s good news in that they’re reducing their debt,” Barofsky said of the accelerated GM payments, “but they’re doing it by taking other available TARP money.”…
“It sounds like it’s kind of like taking money out of one pocket and putting in the other,” said Carper, who got a nod of agreement from Barofsky.
“The way that payment is going to be made is by drawing down on an EQUITY FACILITY OF OTHER TARP MONEY
This prompted a stern letter from Senator Charles Grassley (R-IA), who backed the bailouts, to Treasury Secretary Tim Geithner about the shell game being played by the Obama administration and GM (via Yid with Lid, emphases mine):
General Motors (GM) yesterday announced that it repaid its TARP loans. I am concerned, however, that this announcement is not what it seems. In fact, it appears to be nothing more than an elaborate TARP money shuffle.
On Tuesday of this week, Mr. Neil Barofsky, the Special Inspector General for TARP, testified before the Senate Finance Committee. During his testimony Mr. Barofsky addressed GM’s recent debt repayment activity, and stated that the funds GM is using to repay its TARP debt are not coming from GM earnings.
Instead, GM seems to be using TARP funds from an escrow account at Treasury to make the debt repayments. The most recent quarterly report from the Office of the Special Inspector General for TARP says “The source of funds for these quarterly [debt] payments will be other TARP funds currently held in an escrow account.” See, Office of the Special Inspector General for TARP, Quarterly Report to Congress dated April 20, 2010, page 115.
Furthermore, Exhibit 99.1 of the Form 8K filed by GM with the SEC on November 16, 2009, seems to confirm that the source of funds for GM’s debt repayments was a multi-billion dollar escrow account at Treasury—not from earnings. In the 8K filing GM acknowledged:
Of the $42.6 billion in cash and marketable securities available to GM as of September, 30, 2009, $17.4 billion came from an escrow account with Treasury,
$6.7 billion of the escrow account available to GM was allocable to the repayment of loans to Treasury,
$5.6 billion in cash would remain in the Treasury escrow account following the repayment by GM of their loans, and
Upon repaying Treasury, any balance of escrow funds would be released to GM.
Therefore, it is unclear how GM and the Administration could have accurately announced yesterday that GM repaid its TARP loans in any meaningful way. In reality, it looks like GM merely used one source of TARP funds to repay another. The taxpayers are still on the hook, and whether TARP funds are ultimately recovered depends entirely on the government’s ability to sell GM stock in the future. Treasury has merely exchanged a legal right to repayment for an uncertain hope of sharing in the future growth of GM. A debt-for-equity swap is not a repayment.
I am also troubled by the timing of this latest maneuver. According to Mr. Barofsky, Treasury had supervisory authority over GM’s use of these TARP escrow funds. Since GM’s exit from bankruptcy court, Treasury had approved the use of the escrow funds for costs such as GM’s obligations to its parts supplier Delphi. See, Office of the Special Inspector General for TARP, Additional Insight on Use of Troubled Asset Relief Program Fund (SIGTARP-10-004), dated December 10, 2009, at page 6. According to the GM 8K, GM had planned to use the TARP funds in escrow to pay back the TARP loans on a quarterly basis beginning in the fourth quarter of 2009. But following the April 20, 2010, hearing of the Senate Finance Committee, where Treasury’s decision to exempt GM from the bank TARP excise tax was questioned and GM’s refusal to testify was noted, it is odd that GM suddenly drew down on the TARP escrow and accelerated the repayment of the remaining balance of GM’s outstanding TARP loans.
The bottom line seems to be that the TARP loans were “repaid” with other TARP funds in a Treasury escrow account. The TARP loans were not repaid from money GM is earning selling cars, as GM and the Administration have claimed in their speeches, press releases and television commercials. When these criticisms were put to GM’s Vice Chairman Stephen Girsky in a television interview yesterday, he admitted that the criticisms were valid:
Question: Are you just paying the government back with government money?
Mr. Girsky: Well listen, that is in effect true, but a year ago nobody thought we’d be able to pay this back.
Mr. Girsky then said that GM originally planned to pay the loan over the next five years. So the question is why—other than a desire to justify excluding GM from the administration’s TARP tax proposal—would Treasury and GM reduce GM’s TARP debt with TARP equity and then mischaracterize it as a repayment from earnings? Accordingly, please explain:
1) Your department’s justification for allowing GM to use funds from the TARP escrow account to repay TARP loans,
2) The amount of funds remaining in the TARP escrow account at Treasury that may be released to GM, and
3) The date that you anticipate that the remaining funds in escrow will be released to GM.
Thank you in advance for your cooperation. Please provide the requested information by April 30, 2010. …
To artificially goose Government Motors’ Chevy Volt sales, the Obama administration is not just handing $7,500 to its wealthy buyers (buyer demographic: incomes over $200,000) — it is also ghost-buying Volts via stimulus funds for townships and corporate cronies like General Electric. Including the federal government’s own purchases of the plug-in electric, some estimates put 20 percent of the Volt’s first-year sales as Big Government purchases.
So much for demand.
Now James Hohman at Michigan’s Mackinac Center has added up the numbers at the supply end and found the public subsidy for the Volt amounts to a $3 billion, putting the public subsidy per car at a whopping $250,000 per car. Mackinac’s Capital Confidential reports:
Hohman looked at total state and federal assistance offered for the development and production of the Chevy Volt, General Motors’ plug-in hybrid electric vehicle. His analysis included 18 government deals that included loans, rebates, grants and tax credits. The amount of government assistance does not include the fact that General Motors is currently 26 percent owned by the federal government.
The Volt subsidies flow through multiple companies involed in production. The analysis includes adding up the amount of government subsidies via tax credits and direct funding for not only General Motors, but other companies supplying parts for the vehicle. For example, the Department of Energy awarded a $105.9 million grant to the GM Brownstown plant that assembles the batteries. The company was also awarded approximately $106 million for its Hamtramck assembly plant in state credits to retain jobs. The company that supplies the Volt’s batteries, Compact Power, was awarded up to $100 million in refundable battery credits (combination tax breaks and cash subsidies). These are among many of the subsidies and tax credits for the vehicle.
GM has estimated they’ve sold 6,000 Volts so far. That would mean each of the 6,000 Volts sold would be subsidized between $50,000 and $250,000, depending on how many government subsidy milestones are realized.Comment is buried, click here to see the rest.
"An analysis in The Street on Dec. 22, 2011, criticized its methodology of dividing $1.5 billion in subsidies by the 6,000 cars sold to reach his $250,000 per vehicle number. The Street, a digital financial media company established in 1996, said the author would have reached a very different statistic if the study had been done at the end of 2012 - when GM projects it will have made 60,000 of the cars. It said that technology from the car will be used in roughly 60 million vehicles over the next in 25 years, which would make for a subsidy of roughly $25 per car."
These subsidies are mostly tax credits. They're spun by the conservative blogosphere to make them sound like government handouts. The only government handouts here are the GM stock purchases and a few state and local incentives. There was also a DoE program that subsidized a 240v charger, which expired last year.
Let's also not forget the tax credits and subsidies provided to the Leaf, the Tesla cars, the Prius and all the other hybrid/alt. fuel vehicles out there. The Volt is only being targeted because of the GM bailouts. It's a disingenuous attack for partisan political purposes. And they're only going to get worse as GM does better and better. The end-game is for GM to fail so conservatives can point and say "See?!"
To artificially goose Government Motors’ Chevy Volt sales, the Obama administration is not just handing $7,500 to its wealthy buyers (buyer demographic: incomes over $200,000) — it is also ghost-buying Volts via stimulus funds for townships and corporate cronies like General Electric. Including the federal government’s own purchases of the plug-in electric, some estimates put 20 percent of the Volt’s first-year sales as Big Government purchases.
The Obama administration announced today it is buying more than 100 plug-in electric vehicles and will install charging stations in government buildings in five cities, including Detroit. The General Services Administration — which oversees most of the federal government's 600,000 vehicle fleet — plans to buy 116 plug-in electric vehicles, including 101 extended-range Chevrolet Volts, 10 battery electric Nissan Leafs and five Think City EV models from Finish EV startup, the agency said today [5/24/2011].Comment is buried, click here to see the rest.
101 vehicles is a far cry from 20% total sold the NRO article was claiming. There are over 9000 Volts on the road today. Are there 1700 more Volts that the federal government bought after May 2011?
it's over 18 months since that article first came out. The largest purchaser of vehicles hasn't purchased one more vehicle in 18 months right? You wanted proof that they were purchasing electric vehicles, you got it. Over 90% of the vehicles purchased at that time were Chevy volts.Comment is buried, click here to see the rest.
I've read the study, and the points were valid. The federal and state government's investment totaled $1.5 billion dollars excluding the bailout subsequent purchase of stock.
At the time of the study in question, they had sold ~6000 volts, mostly to corporate fleets which are further tax-subsidized, and government entities. The truth is there in plain text with real numbers - we can project that GM will sell a million this year but the truth will be how well the Volt will sell to consumers. Furthermore, the usefulness of the investments (which were not the bulk of the subsidization - most went toward infrastructure costs including suppliers) in the long term is absurd because unlike other technology investments (like NASA and the NSF) these subsidies are competing with established markets.
"these subsidies are competing with established markets"
The electric car market was not established. That's the entire point of the subsidy. You can argue that they compete with gas cars, but the same players are making electric cars.
"how well the Volt will sell to consumers"
They're projecting around 45,000 to 60,000 sold for 2012. There's a waiting list for around 54,000, organized by state and country:
Every once in a while we get a glimpse into GM's Chevy Volt sales and they always remind me of Chris Farley in Tommy Boy.
'How many Volts did we sell, Tommy?' 'Uhm... ni... niner.' 'I can't hear you, you're trailing off and did I catch a niner in there?'
...General Motors lobbied for a $7,500 tax refund for all buyers, under the shaky (if not false) promise that it was producing the first all-electric mass-production vehicle... At least that's what we were once told... GM has continually revised downward its estimates of how far the machine would go before the gas engine fired, and now says 25 to 50 miles.
It turns out that the premium-fuel fired engine does drive the wheels... It's doubtful that GM would have gotten such a subsidy if it had been revealed that the car would do much of its freeway cruising with a gas engine powering the wheels. [After all, a] hybrid is a hybrid, and the Prius no longer qualifies for a tax credit.
The company will initially buy 12,000 Chevrolet Volts, made by General Motors Co., starting in 2011. GE said it will then add other electric vehicles to its fleet as other car makers expand their offerings. The company said it is in a "strong position to help its 65,000 global fleet customers convert and manage their fleets."
GE plans to buy 1,000 Volts next year and 2,000 to 3,000 per year after that through 2015, GM said. The purchases will comprise a significant portion of GM's early Volt production. The car maker has said it plans to build 10,000 Volts in 2011.
A GM spokesman declined to say if the company now intends to build more Volts, but signaled that may be the case. The GE purchase "won't reduce the number of Volts available to the public," he said.Comment is buried, click here to see the rest.
"you are the biggest gullible Obama stooge on Digg"
And you can eat a bowl of dicks if this is how you think a discussion works. I didn't even bother with the rest of your comment. Go f**k yourself, troll.
crom99Feb 16, 2012
Amazing how many people are not happy about a large American company doing well. If they continue to be profitable, their stock price will increase and we'll eventually be able to recoup our ENTIRE investment in GM. If you're an American taxpayer, you should be rooting for GM, not s**tting on their name. They literally aren't the same company they were prior to bankruptcy.
Seriously, folks, this is a win-win. Enjoy it.
chadpyleFeb 16, 2012
Win-win-lose if you consider the tax-payer.
crom99Feb 16, 2012
GM's success can only be a good thing for the taxpayer, as I already stated.
chadpyleFeb 16, 2012
Restating it doesn't make it any less false.
crom99Feb 16, 2012
Neither does simply calling it false.
josh53188Feb 16, 2012
Did you not understand that the bailout required shares of the stock to be placed in the hands of the government so that the government would recoup all of the costs of the bailout should GM become successful again? It was an investment and without it, the company would have been lost or at best dying a slow death.
chadpyleFeb 16, 2012
I'm opposed because I understand, Josh. The government has no business playing financial adviser - they can't even balance their own budget, for goodness sake.
If/when the government sells those shares, you can bet we won't see a dime of it.
Ford decided to forgo a bailout and they're not "dying a slow death" (on the contrary), because government isn't the only solution to every problem.Comment is buried, click here to see the rest.
frumblerFeb 16, 2012
"If/when the government sells those shares, you can bet we won't see a dime of it. "
And if they sell we wan't see any of it because???
What it will vanish into the ether?
Or you mean you won't be getting a check in the mail for it.
It will pay for at least 12 bombers!
Closed AccountFeb 17, 2012
"If/when the government sells those shares, you can bet we won't see a dime of it. "
--Oddly this doesn't seem to faze the drill-baby-drill and keystone pipeline cultists
daimposterFeb 17, 2012
"Ford decided to forgo a bailout and they're not "dying a slow death" (on the contrary), because government isn't the only solution to every problem."
Ford didn't have the same extend of financial problems....they didn't take the bailout because they were not going to go bankrupt. GM & Chrysler were going to go bankrupt.
Your comparison is horrible....it would only be a good comparison if Ford actually did go bankrupt.Comment is buried, click here to see the rest.
josh53188Feb 16, 2012
@chadpyle I didn't digg you down btw, I don't do that unless the statement someone makes is outright retarded.
I see the viewpoint but in this case it looks like all success. Ford is different from GM in so many ways and I believe that stimuli during a recession is the best solution. It's just sickening to think of where it all went this this time around.
suite307Feb 17, 2012
The only real impact it has is on the buyer's account. It doesn't affect a company account. Depending on the type of share you have and if you're an employee, you can get shares that give you dividends, some with no rights to vote etc etc. The average company has around 20-30 types of shares. Now stop spouting stupid crap.
suite307Feb 17, 2012
Your comment about shares makes you an ignorant, Shares aren't "REAL" money. It doesn't affect their bank accounts or anything. You could buy 1mill. shares and sell them a year later and it won't do anything.Comment is buried, click here to see the rest.
josh53188Feb 17, 2012
Money is real and so too are shares in a company. One can be changed into the other at any given time assuming there is both a buyer and a seller. It affects your bank account when you buy because your bank account will have less money but your assets will be more or less depending on if you can sell it for more or less than you bought it for.
This is common sense and making a stupid assertion like it's ignorant to believe a share in a company has monetary value is more than ignorant, it's a statement of a bafoon..
kyzzyxxFeb 16, 2012
Tool. I don't see a broken capitalist system fixed. Which means it will just happen again.. in time. You people are so f**king gullible it is disgustingComment is buried, click here to see the rest.
crom99Feb 16, 2012
Tool? You people? Yeah... done with you.
DiggPiggletFeb 17, 2012
Not so fast. He has a good point. What has changed to keep this from happening again? Do you support continuous pouring of taxpayer money into corporations?
crom99Feb 17, 2012
Whether or not he has a good point is irrelevant as soon as it gets personal.
There's no guarantee for anything, including this not happening again. All I can provide are the details of the restructuring:
http://www.whitehouse.gov/the_press_office/Fact-Sheet-on-Obama-Administration-Auto-Restructuring-Initiative-for-General-Motors/
And no, I don't generally support bailouts at all. As I said in another comment, though, these were extraordinary circumstances. The economic crisis would have killed the entire banking and automotive businesses had the government not stepped up. We'd be much worse off today had they not been bailed out.
agmlauncherFeb 17, 2012
They've already done their damage:
2007 Saturn Aura. In 30,000 miles I had:
- 4 engine misfires
- 2 steering clunks
- 2 sunroof leaks
- warped brake rotors
- water leaking into the driver side door
- transmission shifting problems severe enough to require a transmission flash
- faulty seatbelt buckle indicator (it would be buckled, but it didn't think it was, so it would constantly beep at me)
Total piece of garbage. I even had to get involved in my state's lemon law arbitration to try and get some compensation for it.
Never buying a GM again.
crom99Feb 17, 2012
I had two Saturns. A 1997 SL1 and a 1999 SL2. There we a few weird quirks with each, but nothing serious. Though they were economy cars, I liked them both. They got the job done.
You should at least give them a test drive or two. Their cars have improved considerably. The Cruze and Malibu are supposed to be great. And, of course, the Volt, but I'm biased there.
r0g3rFeb 17, 2012
And this is why a capitalist should never be for bailouts. You may want to "vote with your wallet" to influence the market by not buying GM because they make crappy cars, in your experience. Yet, you are circumvented, along with the fundamental nature of capitalism itself by bailouts that revive these failed companies, who deserved to go under like any other company who doesn't meet the satisfaction of their customers. How else can a free market work?Comment is buried, click here to see the rest.
illinestFeb 17, 2012
Decent post but the product started to improve a few years before they were bailed out. Particularly look at the second generation Cadillac CTS and the Buick Enclave, both of which were debuted in 2006 and have been roundly praised by the automotive press.
I think it goes to back to the hiring of Bob Lutz in 2001. It takes a few years to bring a car to market. The bailout sped them toward financial health but without good cars none of this would be possible and GM does have a few really good cars right now.
Another thing - related topic - Ford got praised up and down for not needing a bailout but if you follow the industry at all you ought to remember that they restructured themselves in bankruptcy just a few years prior. They weren't the one left standing - rather they were the first to fall.
illinestFeb 17, 2012
Correcting myself - they escaped bankruptcy in 2006 in spite of record losses.
In December 2006, the company raised its borrowing capacity to about $25 billion, placing substantially all corporate assets as collateral to secure the line of credit.[18] Chairman Bill Ford has stated that "bankruptcy is not an option".[19] In order to control its skyrocketing labor costs (the most expensive in the world), the company and the United Auto Workers, representing approximately 46,000 hourly workers in North America, agreed to a historic contract settlement in November 2007 giving the company a substantial break in terms of its ongoing retiree health care costs and other economic issues. The agreement includes the establishment of a company-funded, independently run Voluntary Employee Beneficiary Association (VEBA) trust to shift the burden of retiree health care from the company's books, thereby improving its balance sheet. This arrangement took effect on January 1, 2010. As a sign of its currently strong cash position, Ford contributed its entire current liability (estimated at approximately US$5.5 Billion as of December 31, 2009) to the VEBA in cash, and also pre-paid US$500 Million of its future liabilities to the fund. The agreement also gives hourly workers the job security they were seeking by having the company commit to substantial investments in most of its factories.
The automaker reported the largest annual loss in company history in 2006 of $12.7 billion,[20] and estimated that it would not return to profitability until 2009.[21] However, Ford surprised Wall Street in the second quarter of 2007 by posting a $750 million profit. Despite the gains, the company finished the year with a $2.7 billion loss, largely attributed to finance restructuring at Volvo.[22]
Closed AccountFeb 17, 2012
The same party-before-country folks who were ecstatic when Obama's Olympics bid failed.
u700591Feb 16, 2012
Hopefully this can continue and some jobs can come back. The auto industry decline really hurt a lot cities and towns.
jsnchmpnFeb 16, 2012
Of course it will continue... this is only half time.
notmanFeb 17, 2012
Actually, I live in the Detroit area, and the jobs have been returning for a little over a year now. The auto industry recovery is definitely turning things around in Mi. It still has a way to go, but things are at least in the right direction.
assassyn360Feb 16, 2012
Good job POTUS.
DiggPiggletFeb 16, 2012
And taxpayers will lose around $11 billion.
http://www.autosavant.com/2011/04/19/u-s-government-will-sell-its-gm-shares-this-year-another-wistful-dream-is-dead/Comment is buried, click here to see the rest.
crom99Feb 16, 2012
That article is almost 10 months old. Here's a more recent article:
http://money.cnn.com/2012/02/14/news/economy/romney_gm/index.htm
They ended up not selling the stock that year in hopes that it would improve. According to the article, analysts think it will. And the profit announcement seems to favor that conclusion as well.
DiggPiggletFeb 16, 2012
The article I posted was older but the problem with the GM profit is it's based on a pledge that European sales will increase. In January, industry auto sales in the top 19 European markets fell by 7.2%. If the pledge is not meet GM stocks will crash back down next time.Comment is buried, click here to see the rest.
cherwilcoFeb 17, 2012
wow look at the cheerleaders for failure in this thread! do you f**kers WANT all your future products to be made in china? only if you can blame it on Obama though right?
what about the words "the largest profit in its 103-year-history" don't you naysayers understand?
ageofmasteryFeb 17, 2012
If it means higher corporate profits and unemployed American union workers, then yes the do want everything made in China.
Joined_DiggFeb 17, 2012
That record profit was fostered on the backs of the American taypayers and communities left with the repercussions of GM's poor decisions and Obama's pandering to the unionized voters.Comment is buried, click here to see the rest.
cherwilcoFeb 17, 2012
wow! this is your absolute first comment on digg heck as of the time you wrote this you haven't even dugg any articles yet
sockpuppet much? geesh its not even an inflammatory comment you could have just used your main accnt
Joined_DiggFeb 17, 2012
So the veracity of my post is predicated upon what articles I've clicked on the little thumbs up?
Sounds like you're a poster boy for our current electoral process, choosing style over substance.Comment is buried, click here to see the rest.
cherwilcoFeb 17, 2012
taking one segment of a reply out of context?...check
yeah your so brand new around here
jimsmmFeb 16, 2012
It is great to see the American Auto Industry bounce back! Good for G.M!
barackalypseFeb 17, 2012
Its amazing what you can do when the Government rides in and fixes your debt problem for you...
"Before entering bankruptcy on June 1, 2009, GM had $54.4 billion in debt and owed an additional $20 billion to a retiree health-care trust managed by the United Auto Workers. GM had $88 billion in losses from the end of 2004 until going into bankruptcy.
GM now owes $15.6 billion in debt and preferred stock and $9.4 billion in underfunded retiree obligations. "
Although you might feel differently if you were a GM bondholder and got screwed...
http://www.bloomberg.com/news/2010-11-19/gm-s-bailout-losses-worthwhile-for-obama-as-ipo-shrinks-cost.html
Closed AccountFeb 17, 2012
"Its amazing what you can do when the Government rides in and fixes your debt problem for you..."
--Even more amazing when you're the most profitable industry in the history of industries--and the GOP still fights tooth and nail to give you billions in subsidies, huh? ;-P
crom99Feb 17, 2012
OH SNAP
chadpyleFeb 16, 2012
So, the American people get to take the risk but don't get to share in the rewards? Hey GM, how about a little gratitude for bailing out your poor business practices?
shark72Feb 16, 2012
Here are some of the rewards you share as an American:
- lots more of your fellow Americans have jobs because GM is still in business today.
- even if neither you nor anybody in your family works for GM or any of their hundreds of suppliers or auxiliary businesses, those people who have those jobs today are paying taxes. This helps the economy.
- since they have jobs, they're not drawing unemployment assistance or other forms of welfare. This helps the economy.
- those people who have jobs today have money to spend; they might spend on a product or service that you provide, or help provide. This helps you.
What else do you want? A free car?
The US also pays $20B a *year* in farm subsidies. Your reward as an American is a wide selection of safe, healthy and inexpensive produce and, of course, all the same benefits that our society receives when more people have a chance to work. It does not entitle you to a free fruit basket.
sanmanFeb 16, 2012
sounds like a race-to-the-bottom
"but joe gets a free handout, so why can't I?"
watching other people get govt benefits that the rest of us don't get just isn't that fun
while I know you'd like to extend your taxpayer-funded credit card to all of us - big spender that you are - the fact is that's not sustainable eitherComment is buried, click here to see the rest.
shark72Feb 16, 2012
Lower unemployment, less expenditure on welfare, and higher tax revenues help *every* American.
For every dollar that the government spends, there are going to be some direct beneficiaries, and lots and lots of indirect beneficiaries. That is simply the way the economy works:
- The department of agriculture's budget helps farmers.
- The department defense's budget helps military contractors, as does the DHS budget.
- The budgets of the DEA, Department of the Interior, and the dozen or so other departments help a wide variety of private enterprises.
If you narrowly define a "free handout" as employment in an industry that relies in some part on government funding... believe me, you have your choice of *plenty* of industries in which to go find a job.
But if you don't want to, that's fine -- you can simply enjoy the societal benefits that they bring to everybody.
sanmanFeb 16, 2012
there's a huge difference between jobs that are NEEDED and jobs that are NOT NEEDED, but are artificially created just to give somebody a paycheckComment is buried, click here to see the rest.
chadpyleFeb 16, 2012
I'll take a new car, since a fruit basket is apparently out of the question. Make it an Hyundai or Toyota though, please.
cherwilcoFeb 17, 2012
I guess when you don't have a job and cant afford food you could always try to eat your import. good luck with that
chadpyleFeb 17, 2012
Are you suggesting domestic cars are more nutritious?
stevanoskiFeb 17, 2012
lol
mtownFeb 17, 2012
While I agree with most of what you say AND with the GM bailouts, I do not agree in the farm subsidies. The subsidies only go towards big agribusiness, and the only reason they get them is so that they can sell their produce cheaper than small or local farms can afford.
Monsanto owns like 90% of most US crops and is a multi-billion dollar industry, yet it's still subsidized. Why? Because without subsidies, Monsanto crops would be more expensive than non-genetic-engineered crops, and Monsanto has lobbied extensively to make sure its crops keep getting subsidized.
Watch Food INC.
delphium226Feb 17, 2012
@shark72
All very good points that are predicated upon a person caring about the overall well-being of the country and working towards it.
Whingenuts don't care and just want to say NO to anything the other 'team' comes up with. Party uber alles.
treehugger87Feb 16, 2012
Wow, getting in line to receive a handout for doing nothing? Where are you from, Alaska?
http://www.nytimes.com/1996/10/09/us/fringe-benefits-from-oil-give-alaska-a-big-payday.html?pagewanted=all&src=pm
http://www.nytimes.com/2010/08/19/business/19stimulus.html?_r=1
intrepiddesignFeb 16, 2012
So by your statement I would assume that you think the banks should be helping out the average American since we also bailed them out for their poor business practices?
chadpyleFeb 17, 2012
I suppose. Ultimately, I'd prefer the government stop offering our money up to every corporate panhandler that comes along.
gkiltzFeb 17, 2012
Sooo, the "bailout" is now generating positive cash flow for the government. Where are the critics??
notmanFeb 17, 2012
Just look through the replies on here. There are plenty, bringing up old facts, and false claims. Don't worry, they haven't shut up yet. As long as Fox news is feeding them new BS, they'll be there regurgitating it.
ngwrightFeb 17, 2012
This is a great news story, but I'm still a little concerned that we're building too many cars generally. We still need cars, but with high fuel prices and climate change we should be trying to slowly wean ourselves off this unsustainable form of transportation. Until we retool some of that extra manufacturing capacity to more sustainable uses, we should keep the cheerleading to a minimum.
hillsfarFeb 17, 2012
Good. 10 more years like this with full repayment of TARP money and loans, and the American taxpayer will get the money back.
delphium226Feb 17, 2012
All the while GM and it's employees are paying taxes they wouldn't have paid if they had gone out of business.
hillsfarFeb 19, 2012
That's called the broken window fallacy. Consumer money to buy vehicles would have just gone to other manufacturers and their employees, who would pay taxes.
kymossFeb 16, 2012
wow! good news for our economy. i think 2004 is when i stopped working on the account. ; )
veganpaFeb 17, 2012
f**k you Romney.
notmanFeb 17, 2012
For all of you bitching about bailouts, here's a question for you. I see many of you are pissed, about a company that took a LOAN from the government, and has turned around to become successful again, and rehire employees. Yet you don't seem nearly as pissed that the banks were just GIVEN cash that the government will never see again. Why is that? Is it simply because Obama is attached to it, and you can't possibly like anything he does?
Can any of you actually make a valid point without claiming someone is an Obama lover, or a liberal, or some other weak attempt to insult people? You must live a very lonely, hateful life. I imagine you're a blast at parties. Every discussion turns into a hateful Obama rant I'm guess. That's if people still invite you to parties, after being tired of hearing your rants.
skywiseFeb 16, 2012
Easy to do after Obama renegotiated their union contracts and got the lucrative pension and retirement health plans off GM's books...
treehugger87Feb 16, 2012
Easy to do after firing their idiotic management. Don't forget that GM management bought Hummer thinking everyone would want ridiculous gas guzzling behemoths long into the future.
cawpinFeb 17, 2012
Yeah, nobody bought Hummers. Jackass.
treehugger87Feb 17, 2012
Automotive News
October 9, 2009 - 2:00 pm ET
Year Total % Chng.
*2009 *8193 *-64%
2008 27,485 -51%
2007 55,986 -22%
2006 71,524 -26%
2005 56,727 93%
2004 29,345 -17%
2003 35,259 80%
2002 19,581 2,450%
2001 768 -12%
2000 875
2002 was the year the Bush administration added a tax law that allowed deductions of up to $80,000 for an SUV needed for work. A knew of a company that used that deduction to get a Hummer for their electrolysis business.
As you can see, as soon as gas prices soared the Hummer brand died.
skywiseFeb 17, 2012
Don't forget that Hummers were GM's best selling cars (along with SUVs and large trucks) right up to the spike in gas prices. Their "economy" cars were NOT selling... even AFTER the spike.Comment is buried, click here to see the rest.
treehugger87Feb 17, 2012
GM cars were not selling after the spike in gas prices because GM had spent NO MONEY developing fuel efficient cars. They foolishly thought that people would buy 10 to 12 MPG SUVs and large trucks forever.
Toyota and Honda owned the fuel efficient car market when gas prices spiked. GM management failed the company completely.
barackalypseFeb 17, 2012
That's almost enough to offset their 2005 losses ($10.6 billion). Of course it would take 4 years like this one to offset the $38.7 billion they lost in 2007.
tom536Feb 18, 2012
Wow what a surprise? Now I understand why they cut the pensions, benefits, and other financial resposibilities to their employees which worked twice as hard to bring them back from fictional financial ruin. To big to fail huh!!!!! Business as usual since they went bankrupt. We deserve what we get because we have nobody to blame but us........
griberalFeb 16, 2012
So instead of using the profits to find ways to increase the stock value and helping the taxpayers get their money back, they're giving bonuses to union workers. Oh that's right, this is an election year and Obama needs the unions to force, I mean encourage their members to vote for him.Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
@griberal5:
"So instead of using the profits to find ways to increase the stock value and helping the taxpayers get their money back, they're giving bonuses to union workers. Oh that's right, this is an election year and Obama needs the unions to force, I mean encourage their members to vote for him."
I remember a time, at least 20 years ago, when a company that did well rewarded its employees, not just its executives.
"These are the values inspiring those brave workers in Poland ... They remind us that where free unions and collective bargaining are forbidden, freedom is lost." --Ronald Reagan, Labor Day Address at Liberty State Park, 1980
josh53188Feb 16, 2012
Can you look at the big picture? The company was bankrupt, the union was already there. Would you rather have a labor issue right after the bailout? We're talking about a 7k(at most) bonus to 19k workers... that's around 133 million dollars maximum. It's called profit sharing and it's what any decent company should do with their employees.
treehugger87Feb 16, 2012
Yeah. Those profits should only be going to the rich executives. How dare the people who actually do the work for the company expect to share in the company's success?
/s
blackporsche28Feb 16, 2012
i guess operating in the US without all the waste and redundancy isn't so bad after all. pfft, who are we kidding. time to open a new plant in china!
oh wait, that's exactly what they're doing after being bailed out by the US gov't.Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
So GM is expanding our markets to China? How is that bad?
http://www.cbsnews.com/8301-505245_162-57374662/summary-box-gm-gets-ok-for-new-china-plant/
FTA: "Sales of GM-branded vehicles by GM and its Chinese partners rose 8.3 percent in 2011 to a record of 2.5 million vehicles."
I'm for local production. It makes sense to make stuff in America for Americans, and in China for Chinese, rather than ship things overseas on burn fossil fuels.
I think the US needs to tie labor laws to trade agreements with China, but that's another issue.
crom99Feb 16, 2012
GM sells vehicles all over the world, even China. It's not uncommon to open a plant in the country you plan to sell in. Japanese and German auto companies build many of their cars on American soil with American workers. It's cheaper than shipping them overseas.
blackporsche28Feb 16, 2012
i guess i should expand on my original statement because i was looking farther into the future than the simple don't go to china argument. i never said that having a plant in china was a bad thing, because it does make perfect sense from a business standpoint to build where you're selling. but one of the reasons they are building another plant is because current plants, including those in the US, are working above normal capacity. once the new plant is open the plants here won't have to operate at the same 'excess' level and some jobs will probably be lost. it's obviously a win for GM and the stock that the US gov't still holds, but the potential for some job losses and the big loss in not creating more jobs in the US is more what i was going for.
hiropendragonFeb 16, 2012
Fair enough. Thanks for the explanation.
blackporsche28Feb 16, 2012
I wanted to go back and change my first post after reading some of the other comments to not fall into the same category, but since the edit time expired I hoped it'd go overlooked. It's good news for a great American company to become more successful. Especially since the knock on GM and Ford was always that Toyota, Honda, etc. could expand and sell well overseas, but they couldn't. Hopefully it reaps rewards for all of their plants and maybe more jobs or better pay will be seen in the States instead of my original negative outlook.
partrowFeb 16, 2012
Right, and Buick is the biggest selling car in China.
I am not sure if Buicks are built there or not, and if they are, is that called an import in China or not?
crom99Feb 16, 2012
Yeah, there's a GM plant in Shanghai that builds Buicks, and probably more elsewhere. Not sure if they're counted as imports or not.
I read the reason they're big over there is because the emperor owned one a century ago.
josh53188Feb 16, 2012
China plays this game with us. They get very low import tariffs from us and unless they have partial ownership of the manufacture of a product, you see heavy import tariffs. The US represents 18% of all of their exports and only 7.5% of their imports(CIA World Factbook). We just need to re-evaluate the tariffs we impose on imports. Anyways, there would be no way to compete in China unless you manufacture in China... that's just the way it is. Take a look at this story to get an idea as well: http://moneyland.time.com/2011/12/14/u-s-very-disappointed-by-chinas-new-auto-import-tariffs/
atomheartmotherFeb 16, 2012
So like, since the president is all about making the rich pay their fair share, could he ask his buddies and campaign contributors at GE if they could maybe pay some taxes this year? Pretty please?Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
He's trying, but the GOP is adamantly against the tax reforms Obama is currently proposing under "Buffet rules".
atomheartmotherFeb 16, 2012
He's trying? Please direct me to the WH policy paper outlining his plans to institute a level, flat corporate tax rate without loopholes.I must have missed the release.Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
Not everyone agrees that a flat tax is a good thing. The whole point of different taxes is to promote industries that are better for public good or growth in the direction the country should take (say, high tech, green energy, etc) and impose penalties for companies whose nature is against the public good (heavy polluters, outsourcers, etc).
No, the tax reforms I'm talking about is making it so that people like Romney, who make millions, don't pay a smaller % of taxes than the hardworking middle and lower income earners.
atomheartmotherFeb 16, 2012
You are woefully misinformed. The corporate tax is already flat, except in the sense that it allows big, wealthy companies to avoid paying a lot because of all of the loopholes. Meanwhile small businesses get hammered.
Where's the "fairness" in that?Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
I'm not sure how you can say corporate tax is flat - there's a host of tax breaks and subsidies for businesses of all sizes. And yes, larger businesses also have loopholes, but most of them are things like, "Hey, we just opened a ghost office in a country with low taxes." How do you propose we close that loophole without having the World Bank or International organizations complaining that we're "unfairly trading?"
Such is the result of Reagan through GW Bush's trade politics. (including Clinton)
atomheartmotherFeb 16, 2012
The fact that there are loopholes has no bearing on the fact that it's a flat rate. Every business should be paying the same rate, if you indeed care about fairness.
Obama is not "trying" to change that at all.Comment is buried, click here to see the rest.
partrowFeb 16, 2012
I know you are probably joking, but many do not understand why GE did not pay any federal income tax last year, and this tends to fan the flames of ignorance.
Like other businesses, GE will pay federal income taxes when they turn an overall profit which meets the federal requirements for tax. The reason they did not pay federal income taxes lately is that one of their 4 divisions, GE Capital, had a large loss, which meant that GE overall did not have a profit to pay tax on.
GE has always paid taxes according to the tax laws like other businesses, and will be happy to pay tax when their business shows a profit to pay tax on. They would more than welcome that, and so would their shareholders.
atomheartmotherFeb 16, 2012
GE reported worldwide profits of $14.2 billion, and $5.1 billion of the total came from its operations in the United States in 2010.
Zero US income taxes for a company which made over $14 billion...that's fact.
The NY Times reported that:
"A review of company filings and Congressional records shows that one of the most striking advantages of General Electric is its ability to lobby for, win and take advantage of tax breaks.
Over the last decade, G.E. has spent tens of millions of dollars to push for changes in tax law, from more generous depreciation schedules on jet engines to “green energy” credits for its wind turbines. But the most lucrative of these measures allows G.E. to operate a vast leasing and lending business abroad with profits that face little foreign taxes and no American taxes as long as the money remains overseas."
GE avoided paying taxes through its use of loopholes it lobbied for, and used it's financial muscle (and TV networks) to help President Obama get elected to further them. Indeed, President Obama appointed CEO Jeff Immelt to head his economic advisory board.
Under Immelt's leadership, GE also laid off 21,000 American workers and closed 20 factories between 2007 and 2009. More than half of GE's workforce is now outside the United States.
It's not criminal, but it ought to be.Comment is buried, click here to see the rest.
partrowFeb 16, 2012
The profits, or the profits which would have incurred federal income tax, were obviously offset by losses at GE Capital.
Like you said, they did nothing illegal, and their returns have probably been audited.
number23Feb 16, 2012
And the taxpayers still have been paid back, nor will they... ever.
More billions down the drain like Solyndra.
hiropendragonFeb 16, 2012
http://money.cnn.com/news/storysupplement/economy/bailouttracker/
It's been paid back.But apparently you're too thick-headed to learn to use Google and verify your facts before you post them on Digg, @number23
I'm sick and tired of people like you too willfully ignorant to admit things that Obama has done that are successes. This is one of them.
number23Feb 16, 2012
Wrong f**k-face.
http://en.wikipedia.org/wiki/General_Motors
As of January, 2012, the US government's Troubled Asset Relief Program had about $25 billion invested in GM. Break even for the government was figured at $53.98 v. the then-current share price of about $25.[25]
How f**king stupid are you?Comment is buried, click here to see the rest.
omgscienceFeb 16, 2012
@number23
Someone who uses Wikipedia as their primary source material for an argument has little credibility for arguing facts. And using terms like "f**k-face" just makes you look like a man-child that should have been aborted before birth.
number23Feb 16, 2012
What are arguing? That Obama didn't buy 25 billion in GM stock? That brake even prices isn't $54?
Seriously, is that was passes for cogent argument amount you libs?Comment is buried, click here to see the rest.
crom99Feb 16, 2012
Says the guy who resorts to calling people "f**k-face" and "libs". You aren't making yourself look any better.
1stjonnydeeFeb 17, 2012
I agree with you up until your second grade tantrum over 'f**k-face'.
hiropendragonFeb 16, 2012
First of all, swearing just takes away from any point you make.
Secondly, investment is different from bailout loans.
Thirdly, if you look at the broader picture:
- GM pays taxes on its revenue
- GM employees still have jobs and are spending their money in our economy, as well as income taxes.
- Literally an entire industry was saved from risk of going kaput to once again being the #1 in the world.
This is well past being paid back. And that the US Gov will make more money on stock sales as the price rises, consider that investing in a company when its stock price has dropped significantly, and it has been backed by government dollars - that's a pretty decent start for criteria on a good investment.
So yes, you can take one isolated fact and use it out of context, and then swear at me like a 13 year old. But that doesn't make me stupid or my point less valid.
number23Feb 16, 2012
GM is a monument to poor business practices. For decades they produced gas guzzling, haphazardly built, poorly designed s**t. Even today as gas sky rockets past $4 a gallon they busy producing 600hp Corvettes, Camaros and Cadillacs that struggle to achieve MPGs in the low teens.
No sane investor would put a dime in GM. let alone 25 billion. If we had burned the money in a big pile, at least it would have kept us warm a while.Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
And green technology was part of the push during the bailout.
number23Feb 16, 2012
Yeah, they've produced a car, that even with a 7K kick back (and if Obama has his way 10K), nobody wants it.
I'm all in favor of fuel efficient cars, but let the market decide the best course.Comment is buried, click here to see the rest.
pc25Feb 16, 2012
"Each Chevy Volt sold thus far may have as much as $250,000 in state and federal dollars in incentives behind it — a total of $3 billion altogether," according to an analysis by James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy. This is not counting the cost of bailing out GM itself.
http://news.investors.com/Article/601207/201202141851/obama-administration-raises-chevy-volt-subsidy-.htm
The government lost $14 billion when they divested themselves of their GM shares.
http://autos.aol.com/article/government-will-lose-14-billion-on-auto-bailout/
It was a payback to the UAWComment is buried, click here to see the rest.
crom99Feb 16, 2012
That Mackinac study is deeply flawed and dishonest.
http://www.politifact.com/ohio/statements/2012/jan/31/jim-jordan/jim-jordan-says-subsidy-volt-averages-out-much-250/
notmanFeb 17, 2012
They build the Corvettes, Camaros, and Cadillacs, because people buy them. That's GOOD business practices. Should they stop selling cars that they are making money on, because you don't like the gas mileage they get? Hell, the Corvette still gets better gas mileage than most trucks on the road, and many of the cars.
The argument that they are poorly built cars, is a tired and old argument. That's a reputation they built for themselves in the 90s, when agreeably, they were bad. In the recent decade, there has been a lot of focus on the build quality, and they are on par with most other manufacturers.
And show me a manufacturer that has anything to compete with the Volt. Don't show me a hybrid, because I can get a diesel powered Jetta that gets better gas mileage. Show me an electric car, that elevates the fears of running out of power on the drive home.
pc25Feb 16, 2012
they lost $14 billion on THAT INVESTMENT, or didn't you notice.
crom99Feb 16, 2012
f**k-face? What the f**k is your problem?
pc25Feb 16, 2012
he's channeling most of the libs on Digg
particleman420Feb 16, 2012
by being a typical digg conservative?
i guess that would make sense to a DP shill like yourself.
pc25Feb 16, 2012
no I mean by channeling liberals comments.....
delphium226Feb 17, 2012
@pc25
Reality and you aren't sharing the same co-ordinates.
pc25Feb 17, 2012
really hotshot? do you want me to post liberals comments
pc25Feb 16, 2012
they paid back TARP loan with other TARP loans.
http://reason.com/blog/2010/04/23/gm-pays-back-tarp-loans-withta
lmao
crom99Feb 16, 2012
If you give me $20, and I give the same $20 back to you 5 minutes later, that's essentially the same thing. It's paid back, regardless.
http://www.politifact.com/truth-o-meter/article/2011/may/26/are-auto-companies-paid-up-american-taxpayers/
pc25Feb 16, 2012
wtf don't you understand. They borrowed ADDITIONAL TARP money to pay back the loan genius. Talk about being a kool aid drinking Obama TOOLBAG. You personify the definition.Comment is buried, click here to see the rest.
crom99Feb 16, 2012
WHARRGARBL! This has absolutely nothing to do with Obama. You're the personification of the typical Fox Noise / conservative blog kool-aid drinker. Derp. Take a Xanax, clown.
WTF don't you understand about all the loans being paid off? The received loans in December 2008, then again in 2009. All of these loans are paid back. The only "debt" they have left is stock which the US government owns. They don't have to pay that back. Either the government sells it at a loss or waits until it reaches $53/share.
pc25Feb 16, 2012
it's using your visa card to pay off your master card
notmanFeb 17, 2012
pc, you aren't reading all of his words. You are saying that they took a loan to pay off the other loan. Crom is trying to tell you, they paid off BOTH of those loans.
So sure, it's like using a visa to pay off the mastercard... THEN paying off the visa with your paycheck.
If you're going to debate with someone, read what they post.
pc25Feb 17, 2012
i am reading all is words
his words are a direct contradiction to GM's Vice Chairman Stephen Girsky
http://hotair.com/archives/2010/04/23/how-did-gm-pay-off-its-bailout-loans/
The bottom line seems to be that the TARP loans were “repaid” with other TARP funds in a Treasury escrow account. The TARP loans were not repaid from money GM is earning selling cars, as GM and the Administration have claimed in their speeches, press releases and television commercials. When these criticisms were put to GM’s Vice Chairman Stephen Girsky in a television interview yesterday, he admitted that the criticisms were valid:
Question: Are you just paying the government back with government money?
Mr. Girsky: Well listen, that is in effect true, but a year ago nobody thought we’d be able to pay this back.
Mr. Girsky then said that GM originally planned to pay the loan over the next five years. So the question is why—other than a desire to justify excluding GM from the administration’s TARP tax proposal—would Treasury and GM reduce GM’s TARP debt with TARP equity and then mischaracterize it as a repayment from earnings? Accordingly, please explain:
1) Your department’s justification for allowing GM to use funds from the TARP escrow account to repay TARP loans,
2) The amount of funds remaining in the TARP escrow account at Treasury that may be released to GM, and
3) The date that you anticipate that the remaining funds in escrow will be released to GM.
pc25Feb 16, 2012
you need to check you own chart. From the close to $50 billion that was lent to GM only $361 million was paid back. Talk about being willfully ignorantComment is buried, click here to see the rest.
Joined_DiggFeb 17, 2012
What about all the suppliers and prior shareholders who were shafted by the Obama arranged bankruptcy? The communities hollowed out and left holding the bag on the environmental disasters GM walked away from with the blessing of the administration?Comment is buried, click here to see the rest.
particleman420Feb 16, 2012
(i hate to poiss on your propaganda parade, but the solyndra thing was only millions, not billions.
Joined_DiggFeb 17, 2012
So a little malfeasance by our government is ok, just not too much, right?
number23Feb 16, 2012
By his own Auto Czar's admission, the GM bail out was done " all for the unions", a reliable democratic constituency. Add to this the reporting emerging now that those connected to the administration were channeling billions in to "green energy" investments (most of which have or are failing) that they had a personal stake in AND their attempt to undermine 2nd amendment support by fomenting border violence by suborning illegal gun trafficking and you have. what could be politely describe as, the most brazenly corrupt administration in one hundred years.Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
I find it ironic how anti-Obama people are pro-union when it comes to criticizing the auto bailout, but staunchly anti-union in every other instance.
Guess what? Most investments, in general, fail. Only 1 out of 10 new ventures succeed. That's how investing works; the ones that succeed make up for the ones that fail. Meanwhile, China is spending an order of magnitude more money on green energy research than the US. We can keep up with tech, or we can lose to the inevitable future of green energy.
number23Feb 16, 2012
"I find it ironic how anti-Obama people are pro-union when it comes to criticizing the auto bailout, but staunchly anti-union in every other instance."
What? I was and am and will be opposed to bailing out failed corporation and their parasitic unions.
The GM bailout was nothing more than a kick-back to a reliable democrat constituency and contributor: The UAW.Comment is buried, click here to see the rest.
shark72Feb 16, 2012
I admire your enthusiasm, but I think you're tilting at the wrong windmills:
"Add to this the reporting emerging now that those connected to the administration were channeling billions in to "green energy" investments (most of which have or are failing) that they had a personal stake in"
Citation on the "most of which have or are failing," please.
You are correct that with many of the DOE investments, lines can be drawn to infer personal stakes, but this is hardly tied to this administration.
Remember, the Solyndra loan guarantee program was kicked off during the Bush administration, in 2007, as part of 2005 legislation. One of Solyndra's earliest and largest investors was Madrone Capital Partners, which is funded by the Waltons of Wal-Mart fame -- a family that's donated millions of dollars to Republican candidates.
Did the Bush administration pursue Solyndra because of the Walton connection? You can infer that; I'm not so sure. I think it's more innocent than that; it was many loan guarantees that was created by the Bush administration as a result of the Energy Policy Act of 2005. Were some big GOP donors invested in energy? Sure; Bush was a very energy industry-friendly president. But your suggestion that this policy was driven by favoritism? I disagree.
"AND their attempt to undermine 2nd amendment support by fomenting border violence by suborning illegal gun trafficking and you have. what could be politely describe as, the most brazenly corrupt administration in one hundred years."
Again -- it's good to be suspicious, but your facts are a little mixed up. The ATF gun walking operations began in 2005; they're simply something that the current administration continued. Should the new administration have put an end to this Bush-era program? Perhaps.
But your charge that the Bush administration launched the operations to undermine 2nd Amendment support is patently absurd. Look -- Bush may have made some bad choices about the economy. He may have mispronounced a few words here and there. But accusing him of being anti-2nd Amendment? Listen to yourself.
number23Feb 16, 2012
Wrong. "Gunwalking" began and ended (2006-2007) under Bush but was started again, in earnest, by Obama (though no one seems to know anything about...) and a border agent died as result.
http://en.wikipedia.org/wiki/Operation_Fast_and_Furious
The "gunwalking" method of Operation Wide Receiver (2006-2007) was questioned at ATF HQ by Acting Director for Field Operation William Hoover and the operation terminated by Phoenix ATF SAC William Newell 6 Oct 2007 after Mexican police failed to interdict gun traffickers after they crossed into Mexico.[11] Gunwalking under Operation Fast and Furious (2009-2010) without involvement of Mexican law enforcement was first questioned by the ATF field agents[12] and the licensed gun dealers[13][14][15] cooperating with them. Under Fast and Furious, dissident ATF field agents expressed their concerns to Congress after the death of Border Patrolman Brian Terry.[16][17]Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
It was not Obama's idea to do "gunwalking". At the same time, do you expect the President of the United States to micromanage every government agency? Does authorizing FBI / DEA / ATF operations need to clear the President's desk?
It was a stupid idea and the people responsible are gone.
number23Feb 16, 2012
So they begin a policy which results in a dead border agent and nobody seems to know anything about it?
Nothing to see here... move along...
And by the way, just happened to coincide with statements from Dear Leader that "[m]ore than 90 percent of the guns recovered in Mexico come from the United States"Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
People knew about it once the agent showed up dead, yes. As soon as that happened, Congress was alerted to it. What's your problem?
RE: Guns from America: America produces a lot of guns. Mexico does not.
number23Feb 16, 2012
So Dear Leader is running around claiming that American guns are fueling Mexican gun violence at the same time he's supplying guns that fuel Mexican gun violence and you think it's just a coincidence?Comment is buried, click here to see the rest.
shark72Feb 16, 2012
Both Wide Receiver and Fast and Furious were major operations of the umbrella Operation Gunrunner, which has operated continuously.
Both operations were equally risky, and, as argued by many, equally counterproductive. Sure, 1,400 people were arrested over five years, but at what cost? Besides the death of Brian Terry, how many guns got into the hands of drug lords, and were then used to kill untold people?
My point stands: Fast and Furious certainly wasn't launched as a covert attempt to weaken the 2nd amendment, and neither was Wide Receiver. Frankly, if I lived on the border I might be *more* inclined to buy a weapon if I felt that more south-of-the-border outlaws were packing heat thanks to Operation Gunrunner. Your assertion is straying into tinfoil hat territory.
treehugger87Feb 16, 2012
Okay, provide the video of Ron Bloom saying "We Did It All for the Unions"
...crickets...crickets...crickets...
norman619Feb 16, 2012
So how much of that goes to the American people since we are part owners?
hiropendragonFeb 16, 2012
That would be if the auto industry hadn't paid the US government back. They have.
http://money.cnn.com/news/storysupplement/economy/bailouttracker/
number23Feb 16, 2012
The US hasn't, nor will it ever, recover the billions invested in GM stock
Dolt.
http://en.wikipedia.org/wiki/General_Motors
As of January, 2012, the US government's Troubled Asset Relief Program had about $25 billion invested in GM. Break even for the government was figured at $53.98 v. the then-current share price of about $25.[25]Comment is buried, click here to see the rest.
crom99Feb 16, 2012
The loans are paid back. They aren't required to pay back stock purchases. The government will (ideally) hold onto the stock until it reaches parity (or profit) and sell it.
partrowFeb 16, 2012
Get us out now. It is a terrible "investment" for the U.S. taxpayer.
crom99Feb 16, 2012
Why not wait until the stock price is higher?
devnullFeb 16, 2012
So you would rather us sell the stock now, at a loss, then wait until it's back to the price we bought it for?
remind me not to follow your investing strategies.
number23Feb 16, 2012
@crom
Good Lord are you stupid. GM stock price has to nearly f**king double just for the taxpayer break even. What the hell do you think that's going happen?Comment is buried, click here to see the rest.
crom99Feb 16, 2012
"Good Lord are you stupid"
Hah, another cogent argument from someone complaining about lack of cogent arguments.
pc25Feb 16, 2012
the Government lost $14 billion divesting themselves of the stock.
partrowFeb 16, 2012
Because of the opportunity cost of money.
Waiting until one's losing investments climb back to cost (if they ever do) is a fool's game.
shark72Feb 16, 2012
I agree with you, but it won't happen during this administration (or the next one) because it's a a political third rail. It tacks a hard number to the loss on the stock sale, which will be bandied about by the administration's opponents -- even though the cash from that sale would be actual, hard cash that would go toward reducing the deficit.
The investment in GM was a good one, and it will continue to pay back by helping the economy, regardless of whether the Treasury Department continues to hold shares. I believe GM will hit $50 a share sooner or later, but I'll bet that the Treasury will ultimately make more money if it sells its stake and uses the cash to pay down debt.
josh53188Feb 16, 2012
@shark72 The US is on an interest-only payment scheme. It won't get paid towards the debt, only less will get added to it. Debt isn't a bad thing but when it's pushing 100% of GDP like it is now...
number23Feb 16, 2012
Drawing a distinction between outright loans and stock purchase is stupid.
The fact remains billions of American taxpayer money was given to a failed corporation, who, for decades produced shocking poor products and was a study in failed management practices, and that money will never be recovered.Comment is buried, click here to see the rest.
partrowFeb 16, 2012
Again, the opportunity cost of money.
When you take your money out of a losing investment, and place it into a winning investment, your gains will usually be much higher. In addition, there is always a good chance that a losing investment will get worse and you will lose even more. It is usually only a person's ego which drives them to try to "get back to even" on a particular investment.
Another way to say this is: If someone came to your door today, and gave you $10,000 to invest in a company, would you put it into GM? Or would you put it into one of the other 8000 stocks, many of which are solid, growing investments?
crom99Feb 16, 2012
Personally, I wouldn't put it into any stocks because I'm not really a risk-taker. But you make a good point. Conceded.
hiropendragonFeb 16, 2012
If stock analysts were so good at picking winners, we wouldn't be in such a financial mess.
pc25Feb 16, 2012
the loans were paid back wit other TARP money
notmanFeb 17, 2012
Before the bankruptcy, GM's stock was typically $50+, and at one point, peaked over $90. When things are rolling again, the government will have no problem getting their money back. It's already gone up to $27 since this news hit.
partrowFeb 16, 2012
No, the U.S. taxpayer still owns 33% of the company, and the Canadian taxpayers own 12+%.
shark72Feb 16, 2012
The GM loans, and stockholder investment in the company, are separate things. It is correct that the loans have been paid back. You are also correct that the US and Canada governments are shareholders.
I agree with you that the US Treasury won't see break-even on GM's stock price for at least few more years of earnings numbers like these. However, GM's continued operation provides a boost to the economy that offsets this investment.
partrowFeb 16, 2012
"If stock analysts were so good at picking winners, we wouldn't be in such a financial mess."
What, exactly, does stock picking have to do with the national financial mess?
sanmanFeb 16, 2012
Oh gee, it's raining money - today - so I guess it's time to sign ridiculously inflated wage agreements with the unions, and lifetime job guarantees, and guarantees for jobs for their kids, and their pets, and their extended cousins. So that some illiterate moron can get paid $80K for shifting a car from ParkingLot A to ParkingLot B, while proudly beaming at how this is all good for the middle class.Comment is buried, click here to see the rest.
jhw539Feb 16, 2012
"so I guess it's time to sign ridiculously inflated wage agreements"
Typically you don't harp on long-ended company practices, particularly if the old CEO was retired (by "request" of the majority owner) and replaced by a new guy who had never worked in the company before, but if you really have nothing better to complain about I guess you can go full assh**e and work over the past. (Let me guess, you're not friends with any of your ex'es are you?)
shark72Feb 16, 2012
"So how much of that goes to the American people since we are part owners?"
That's actually a good question. You can estimate it by adding some numbers:
- your estimate of the taxes GM will pay on that $9.2B net profit
- the money kept in the economy because US consumers had more options for purchasing vehicles from a US company
- the taxes paid by the people who have jobs today due to the GM bailout
And then accounting for:
- the money saved that would otherwise have gone to support unemployed auto workers (unemployment, SNAP, etc.)
Many people, of course, are still angry about the bailout. They argue that with unemployment the way it is and with so many of our manufacturing jobs going overseas anyway, what difference does it make if X many more people are unemployed, or we lose another industry? The rationale here is that the government will always be there to support our unemployed workers if it's not willing to do what it takes to support our industries.
I disagree -- I think America is at its best when we're a nation of workers, not a nation of people relying on government assistance. But that doesn't always happen magically -- sometimes, the government needs to make the necessary investments to keeping the engine of our economy going. Money spent giving people an opportunity to work is generally a better investment than money spent to allow people to survive because they're not working.
We do have to do both -- times are tough and we need those social safety nets -- but ultimately, it's a smarter choice to help private enterprises put people to work, than it is to admit defeat and spend more money on the safety net.
chadpyleFeb 16, 2012
"your estimate of the taxes GM will pay on that $9.2B net profit"
So, the government takes money from tax-payers, gives it to GM and now GM gives it back to the government to squander... splendid!
"the money kept in the economy because US consumers had more options for purchasing vehicles from a US company"
In a world without GM and Chrysler, consumers would still have plenty of options (perhaps more). Furthermore, forcing a company to restructure due to poor management does not infer total collapse. Finally, our American automakers source the far majority of the parts and some assembly in Mexico, Canada and overseas; so, the bulk of the money isn't returning to local economies. In contrast, foreign automakers like Toyota actually manufacture about 80% of their vehicles here in the U.S.
"the taxes paid by the people who have jobs today due to the GM bailout"
Again, the bailout was financed by tax-payers. Laundering the money through the tax system does not provide any net gain to the people who unwittingly assumed all the risk.
Ultimately, government bailouts mean rewarding companies for gross mismanagement, which is wrong. Ford decided to take a more traditional route for restructuring and they're prospering as well.
shark72Feb 16, 2012
"So, the government takes money from tax-payers..."
Not per se. Taxes have generally been going down, between the Bush/Obama tax cuts, the payroll tax cuts, and other Recovery Act tax cuts. Taxpayers *aren't* paying for this (or, arguably, anything), because we have a deficit. The government is spending money it doesn't have. The rationale is that making the right investments will yield a positive return, and ultimately reduce the deficit.
This was the original rationale for the Bush tax cuts, as well -- it was known that the reduction in the tax base was unsustainable on its own, but the theory was that it would grow the economy and, ultimately, the tax base. However, we know how well that worked out.
"In a world without GM and Chrysler, consumers would still have plenty of options (perhaps more)."
You are correct, but if it's all the same, I'd rather have those buildings in Detroit be American-owned. It's bad enough that Fiat took a stake in Chrysler. Several Chinese automakers were lining up to buy GM's assets had they gone under. Would lots of Americans been perfectly happy buying their Chevrolets if the money were going to China? Sure thing. But I'm glad we avoided this.
"Again, the bailout was financed by tax-payers. Laundering the money through the tax system does not provide any net gain to the people who unwittingly assumed all the risk."
The numbers on our 1040s would have been the same had the Treasure department invested that money elsewhere. The risk is ultimately the size of the deficit, and not taxpayers' bottom lines. A larger deficit is, of course, bad, but some are painting this like each of us had to skip that vacation this year to write a check to GM for $500. It doesn't work that way.
Will there ultimately be a net gain to the people? There are a lot of moving parts here, but I strongly believe that this will be a net positive for taxpayers, as we'll get to enjoy the many rewards of a stronger economy.
"Ultimately, government bailouts mean rewarding companies for gross mismanagement, which is wrong. Ford decided to take a more traditional route for restructuring and they're prospering as well."
I agree. Contrast the Chrysler bailout of the 1980s to the GM restructuring, in which the government took a significant larger role.
Chrysler got to where they were by making crappy cars and relying on patriotism to move inventory, and emerged from the bailout with the K car, yet another crappy car. GM fixed some very basic practices, and their vehicles -- while not worldbeaters -- are significantly better now.
Interestingly, Fiat went through a similar cycle decades ago. Propped up by Italy's protectionist trade laws, they were allowed to make really, really bad cars for a long time. When the situation changed and they were forced to compete on the world market on quality, their cars got better -- and now they own part of Chrysler.
hiropendragonFeb 16, 2012
"So, the government takes money from tax-payers, gives it to GM and now GM gives it back to the government"
Yes, that's generally how any government funded company works. It's also how any tax break works. However, that money gets spent several times over and fuels the economy.
"In a world without GM and Chrysler, consumers would still have plenty of options "
... of non-American brands. This is about the US not exiting from the auto industry, above all other things.
"Furthermore, forcing a company to restructure due to poor management does not infer total collapse."
I believe the word you mean is "imply", not "infer".
"Finally, our American automakers source the far majority of the parts and some assembly in Mexico, Canada and overseas"
This is true, and a result of bad trade agreements made without consideration of fair wages of foreign countries. However, please cite source for this: "so, the bulk of the money isn't returning to local economies." - while bulk of manufacturing of parts may be foreign, where are the numbers to show that the bulk of income is thus passed along to foreign countries?
"Again, the bailout was financed by tax-payers. Laundering the money through the tax system does not provide any net gain to the people who unwittingly assumed all the risk."
The whole economy is, as you say "laundering money". Money goes around in cycles. The more the money moves, the faster our economy is. That's macroeconomics 101. That's why things like the TVA helped the US out of the Great Depression. Ultimately, cutting taxes also provides growth to the economy, as it frees up money for companies to spend; however, if those companies are about to go kaput, like GM was, then all the corporate tax cuts in the world wouldn't help.
drkroman9Feb 16, 2012
When exactly did the government take money from tax payers? Taxes have not gone up in the last decade. They allowed themselves to go further into a deficit to buy up shares of GM.
If GM rebounds and increases their share price above what the government paid for it, then they would profit and the money would go to reducing the deficit they created in buying the shares.
Its called an investment and it looks like its paying off.
chadpyleFeb 16, 2012
The government doesn't generate income - it either takes it from tax-payers or simply prints the money it needs, which is even more egregious. You see, when you're working with a currency that has no intrinsic value, like the dollar, the monetary value is determined by the number of dollars in circulation. When the Federal Reserve creates a trillion new dollars, every dollar you and I have reduces in value, respectively. The inflation tax is by far the largest, most insidious tax on the American people.Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
You're both right.
matthrFeb 16, 2012
Since the US owns stock in GM, 33% is the figure quoted by some of the others in this thread, I imagine we'll get a dividend. Still this is proof that the auto bailouts saved the company, and we didn't throw good money after bad as you claimed back then. Sometime in the next few years the US will be able to start selling it's stock putting us in the black for this investment. considering the manufacturing capabilities, and jobs saved I'd probably say we already have seen a net gain on investment.
chadpyleFeb 16, 2012
"Still this is proof that the auto bailouts saved the company, and we didn't throw good money after bad as you claimed back then."
How do you account for Ford, who didn't take a bailout?Comment is buried, click here to see the rest.
crom99Feb 16, 2012
The initial loans made in 2008 went to all Big Three companies. For received the largest of the loans.
http://blogs.cars.com/kickingtires/2010/12/report-ford-took-federal-funds-too.html
chadpyleFeb 16, 2012
In regards to Ford, the article states: "this loan was not a bailout."
Nevertheless, the government shouldn't be playing corporate lender with tax-payer money. I'm even more appalled to see they loaned billions to BMW and Toyota too! :(Comment is buried, click here to see the rest.
crom99Feb 16, 2012
I don't consider loans to be bailouts, either, but some people around here do. It's important to note that for those people who think any government intervention is evil.
Given the historical context, an economic crash and credit freeze, I don't have any problem with what they did. We'd be in far worse shape than we are now.Comment is buried, click here to see the rest.
dennysongFeb 16, 2012
Please get ride of the Unions once for all.
hiropendragonFeb 16, 2012
Yes, please give the Unions a ride.
treehugger87Feb 16, 2012
The Unions did not cause GM to fail. Terrible decisions by management did.
http://kottke.org/09/06/why-gm-failed
GM made terrible products with terrible design, used "planned obsolescence" to try to sell more cars while Honda & Toyota were creating made to last quality automobiles, and overstretched their brand ownerships when they bought the SAAB brand. None of that has anything to do with unions.
crom99Feb 16, 2012
Some of these people are saying "I'm only buying from Ford now..." or some such nonsense, ignoring that Ford also took government loans and uses union labor.
drkroman9Feb 16, 2012
Yes, lets companies decide how much or how little to pay their employees and how many or how few benefits they decide to offer. That worked out well for the 1940s
computerczarFeb 16, 2012
Would have been nice if they paid the US Gov all that money we lent them.
jeremylew416Feb 17, 2012
The question we should be asking is where this huge profit came from. If they earned it fair and square then more power to them, but I don't see how it's possible with the recession. Hopefully they didn't cut spending on quality control in order to get this profit, or they were hiding money away we never knew about.Comment is buried, click here to see the rest.
delphium226Feb 17, 2012
You're right, it can't have been good business practice! It must have been a conspiracy!
/s
Occam's razor. Google it.
partrowFeb 16, 2012
And their European division turned in "horrendous numbers".
GM said Thursday that it lost $562 million on its European operations during the fourth quarter.
Get us U.S. and Canadian taxpayers out of this company!Comment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
Name a single large company where every division is profitable, @partrow?
'Tis the nature of business and investment. Not everything makes money. No risks, no gain.
partrowFeb 16, 2012
IBM or Apple are good examples, but that is not the point.
The loss in the European division was called "horrendous" - it was over a half a billion dollars, which is shocking. That is $1,400 loss per vehicle! Here is a good article on the loss:
http://tinyurl.com/7vtjpev
All we can hope is that you are not running a company or any part of one, because your board and stockholders would fire you immediately if you told them "Tis the nature of business and investment. Not everything makes money. No risks, no gain".
ReplyComment is buried, click here to see the rest.
hiropendragonFeb 16, 2012
Clearly we disagree on investments and how companies are run. *shrugs*
partrowFeb 16, 2012
Yes, that is clear.
Mine are self-managed and quite successful, how are yours?
karmashockFeb 16, 2012
Fantastic. So the billions in loans are going to get repaid soon and we won't need to keep subsidizing your electric car?
Because that would be awesome.Comment is buried, click here to see the rest.
crom99Feb 16, 2012
The loans are repaid. All that's left is stock. And it's for the entire company, not the Volt, but you knew that.
pc25Feb 16, 2012
from the NY TIMES
http://www.nytimes.com/2010/05/02/business/02gret.html
Repaying Taxpayers With Their Own Cash
crom99Feb 16, 2012
Or just giving back the loans.
http://www.factcheck.org/2010/05/general-motors-debt/
Spin it however you want. The loan obligations are paid in full.
pc25Feb 16, 2012
if you have other figures to counter these post them
http://www.faqs.org/sec-filings/091119/General-Motors-Co_8-K/
Furthermore, Exhibit 99.1 of the Form 8K filed by GM with the SEC on November 16, 2009, seems to confirm that the source of funds for GM’s debt repayments was a multi-billion dollar escrow account at Treasury—not from earnings. In the 8K filing GM acknowledged:
Of the $42.6 billion in cash and marketable securities available to GM as of September, 30, 2009, $17.4 billion came from an escrow account with Treasury,
$6.7 billion of the escrow account available to GM was allocable to the repayment of loans to Treasury,
$5.6 billion in cash would remain in the Treasury escrow account following the repayment by GM of their loans, and
Upon repaying Treasury, any balance of escrow funds would be released to GM.
Therefore, it is unclear how GM and the Administration could have accurately announced yesterday that GM repaid its TARP loans in any meaningful way. In reality, it looks like GM merely used one source of TARP funds to repay another. The taxpayers are still on the hook, and whether TARP funds are ultimately recovered depends entirely on the government’s ability to sell GM stock in the future. Treasury has merely exchanged a legal right to repayment for an uncertain hope of sharing in the future growth of GM. A debt-for-equity swap is not a repayment.
http://radioviceonline.com/gm-repays-loan-to-us-actually-not-really/Comment is buried, click here to see the rest.
crom99Feb 16, 2012
This supports what I'm saying. GM received TARP money in two forms: loans and stock purchases. They paid back the loans (which essentially was just giving back the loans given to them in the first place), but the stock is still outstanding. The link I posted in my previous comment backs this up. The stock purchase isn't considered a loan that GM has to pay back. The claims that the loan were repaid are based on the loan portion of the TARP funds, not the stock purchase.
pc25Feb 16, 2012
it's using additional TARP money available to pay back the first tarp loan. The additional tarp money HASN'T been paid back.
crom99Feb 16, 2012
That's neither what your article says, nor the two fact check links I provided say.
pc25Feb 16, 2012
FTA
Therefore, it is unclear how GM and the Administration could have accurately announced yesterday that GM repaid its TARP loans in any meaningful way. In reality, it looks like GM merely used one source of TARP funds to repay anothe
it's using your master card to pay off our visa card.
Furthermore
The taxpayers are still on the hook, and whether TARP funds are ultimately recovered depends entirely on the government’s ability to sell GM stock in the future.
they sold the stock at a $14 billion LOSSComment is buried, click here to see the rest.
pc25Feb 16, 2012
http://hotair.com/archives/2010/04/23/how-did-gm-pay-off-its-bailout-loans/
During an April 20 hearing on Capital Hill, Sen. Tom Carper, (D-Del.) asked some pointed questions of Neil Barofsky, the “special watch dog” on the Wall Street Bailout, aka, TARP.
“It’s good news in that they’re reducing their debt,” Barofsky said of the accelerated GM payments, “but they’re doing it by taking other available TARP money.”…
“It sounds like it’s kind of like taking money out of one pocket and putting in the other,” said Carper, who got a nod of agreement from Barofsky.
“The way that payment is going to be made is by drawing down on an EQUITY FACILITY OF OTHER TARP MONEY
This prompted a stern letter from Senator Charles Grassley (R-IA), who backed the bailouts, to Treasury Secretary Tim Geithner about the shell game being played by the Obama administration and GM (via Yid with Lid, emphases mine):
General Motors (GM) yesterday announced that it repaid its TARP loans. I am concerned, however, that this announcement is not what it seems. In fact, it appears to be nothing more than an elaborate TARP money shuffle.
On Tuesday of this week, Mr. Neil Barofsky, the Special Inspector General for TARP, testified before the Senate Finance Committee. During his testimony Mr. Barofsky addressed GM’s recent debt repayment activity, and stated that the funds GM is using to repay its TARP debt are not coming from GM earnings.
Instead, GM seems to be using TARP funds from an escrow account at Treasury to make the debt repayments. The most recent quarterly report from the Office of the Special Inspector General for TARP says “The source of funds for these quarterly [debt] payments will be other TARP funds currently held in an escrow account.” See, Office of the Special Inspector General for TARP, Quarterly Report to Congress dated April 20, 2010, page 115.
Furthermore, Exhibit 99.1 of the Form 8K filed by GM with the SEC on November 16, 2009, seems to confirm that the source of funds for GM’s debt repayments was a multi-billion dollar escrow account at Treasury—not from earnings. In the 8K filing GM acknowledged:
Of the $42.6 billion in cash and marketable securities available to GM as of September, 30, 2009, $17.4 billion came from an escrow account with Treasury,
$6.7 billion of the escrow account available to GM was allocable to the repayment of loans to Treasury,
$5.6 billion in cash would remain in the Treasury escrow account following the repayment by GM of their loans, and
Upon repaying Treasury, any balance of escrow funds would be released to GM.
Therefore, it is unclear how GM and the Administration could have accurately announced yesterday that GM repaid its TARP loans in any meaningful way. In reality, it looks like GM merely used one source of TARP funds to repay another. The taxpayers are still on the hook, and whether TARP funds are ultimately recovered depends entirely on the government’s ability to sell GM stock in the future. Treasury has merely exchanged a legal right to repayment for an uncertain hope of sharing in the future growth of GM. A debt-for-equity swap is not a repayment.
I am also troubled by the timing of this latest maneuver. According to Mr. Barofsky, Treasury had supervisory authority over GM’s use of these TARP escrow funds. Since GM’s exit from bankruptcy court, Treasury had approved the use of the escrow funds for costs such as GM’s obligations to its parts supplier Delphi. See, Office of the Special Inspector General for TARP, Additional Insight on Use of Troubled Asset Relief Program Fund (SIGTARP-10-004), dated December 10, 2009, at page 6. According to the GM 8K, GM had planned to use the TARP funds in escrow to pay back the TARP loans on a quarterly basis beginning in the fourth quarter of 2009. But following the April 20, 2010, hearing of the Senate Finance Committee, where Treasury’s decision to exempt GM from the bank TARP excise tax was questioned and GM’s refusal to testify was noted, it is odd that GM suddenly drew down on the TARP escrow and accelerated the repayment of the remaining balance of GM’s outstanding TARP loans.
The bottom line seems to be that the TARP loans were “repaid” with other TARP funds in a Treasury escrow account. The TARP loans were not repaid from money GM is earning selling cars, as GM and the Administration have claimed in their speeches, press releases and television commercials. When these criticisms were put to GM’s Vice Chairman Stephen Girsky in a television interview yesterday, he admitted that the criticisms were valid:
Question: Are you just paying the government back with government money?
Mr. Girsky: Well listen, that is in effect true, but a year ago nobody thought we’d be able to pay this back.
Mr. Girsky then said that GM originally planned to pay the loan over the next five years. So the question is why—other than a desire to justify excluding GM from the administration’s TARP tax proposal—would Treasury and GM reduce GM’s TARP debt with TARP equity and then mischaracterize it as a repayment from earnings? Accordingly, please explain:
1) Your department’s justification for allowing GM to use funds from the TARP escrow account to repay TARP loans,
2) The amount of funds remaining in the TARP escrow account at Treasury that may be released to GM, and
3) The date that you anticipate that the remaining funds in escrow will be released to GM.
Thank you in advance for your cooperation. Please provide the requested information by April 30, 2010. …
Sincerely,
Charles E. Grassley
Ranking MemberComment is buried, click here to see the rest.
karmashockFeb 16, 2012
I've seen a lot of reports that the repayment was slight of hand.
basically borrowing more money, paying off older debts with new government debt, and then claiming to have paid off the debt.
They didn't pay it off. They rolled it over.
If they're making money, then pay the money back. Or at least start making monthly/quarterly payments at a reasonable interest rate.Comment is buried, click here to see the rest.
pc25Feb 16, 2012
http://www.nationalreview.com/planet-gore/286429/volt-cost-taxpayer-250000-car-henry-payne
Volt Cost to Taxpayer: $250,000 per Car
To artificially goose Government Motors’ Chevy Volt sales, the Obama administration is not just handing $7,500 to its wealthy buyers (buyer demographic: incomes over $200,000) — it is also ghost-buying Volts via stimulus funds for townships and corporate cronies like General Electric. Including the federal government’s own purchases of the plug-in electric, some estimates put 20 percent of the Volt’s first-year sales as Big Government purchases.
So much for demand.
Now James Hohman at Michigan’s Mackinac Center has added up the numbers at the supply end and found the public subsidy for the Volt amounts to a $3 billion, putting the public subsidy per car at a whopping $250,000 per car. Mackinac’s Capital Confidential reports:
Hohman looked at total state and federal assistance offered for the development and production of the Chevy Volt, General Motors’ plug-in hybrid electric vehicle. His analysis included 18 government deals that included loans, rebates, grants and tax credits. The amount of government assistance does not include the fact that General Motors is currently 26 percent owned by the federal government.
The Volt subsidies flow through multiple companies involed in production. The analysis includes adding up the amount of government subsidies via tax credits and direct funding for not only General Motors, but other companies supplying parts for the vehicle. For example, the Department of Energy awarded a $105.9 million grant to the GM Brownstown plant that assembles the batteries. The company was also awarded approximately $106 million for its Hamtramck assembly plant in state credits to retain jobs. The company that supplies the Volt’s batteries, Compact Power, was awarded up to $100 million in refundable battery credits (combination tax breaks and cash subsidies). These are among many of the subsidies and tax credits for the vehicle.
GM has estimated they’ve sold 6,000 Volts so far. That would mean each of the 6,000 Volts sold would be subsidized between $50,000 and $250,000, depending on how many government subsidy milestones are realized.Comment is buried, click here to see the rest.
crom99Feb 16, 2012
Bad study:
http://www.politifact.com/ohio/statements/2012/jan/31/jim-jordan/jim-jordan-says-subsidy-volt-averages-out-much-250/
"An analysis in The Street on Dec. 22, 2011, criticized its methodology of dividing $1.5 billion in subsidies by the 6,000 cars sold to reach his $250,000 per vehicle number. The Street, a digital financial media company established in 1996, said the author would have reached a very different statistic if the study had been done at the end of 2012 - when GM projects it will have made 60,000 of the cars. It said that technology from the car will be used in roughly 60 million vehicles over the next in 25 years, which would make for a subsidy of roughly $25 per car."
These subsidies are mostly tax credits. They're spun by the conservative blogosphere to make them sound like government handouts. The only government handouts here are the GM stock purchases and a few state and local incentives. There was also a DoE program that subsidized a 240v charger, which expired last year.
crom99Feb 16, 2012
Let's also not forget the tax credits and subsidies provided to the Leaf, the Tesla cars, the Prius and all the other hybrid/alt. fuel vehicles out there. The Volt is only being targeted because of the GM bailouts. It's a disingenuous attack for partisan political purposes. And they're only going to get worse as GM does better and better. The end-game is for GM to fail so conservatives can point and say "See?!"
pc25Feb 16, 2012
To artificially goose Government Motors’ Chevy Volt sales, the Obama administration is not just handing $7,500 to its wealthy buyers (buyer demographic: incomes over $200,000) — it is also ghost-buying Volts via stimulus funds for townships and corporate cronies like General Electric. Including the federal government’s own purchases of the plug-in electric, some estimates put 20 percent of the Volt’s first-year sales as Big Government purchases.
So much for demand.
more subsidy on top of the bailouts.Comment is buried, click here to see the rest.
crom99Feb 16, 2012
I'm going to need a better citation about the ghost-buying than a broken link in a NRO article.
pc25Feb 16, 2012
http://latimesblogs.latimes.com/greenspace/2011/05/us-government-electric-vehicles-.html
http://www.akdart.com/enviro91.html
The Obama administration announced today it is buying more than 100 plug-in electric vehicles and will install charging stations in government buildings in five cities, including Detroit. The General Services Administration — which oversees most of the federal government's 600,000 vehicle fleet — plans to buy 116 plug-in electric vehicles, including 101 extended-range Chevrolet Volts, 10 battery electric Nissan Leafs and five Think City EV models from Finish EV startup, the agency said today [5/24/2011].Comment is buried, click here to see the rest.
crom99Feb 16, 2012
101 vehicles is a far cry from 20% total sold the NRO article was claiming. There are over 9000 Volts on the road today. Are there 1700 more Volts that the federal government bought after May 2011?
pc25Feb 16, 2012
it's over 18 months since that article first came out. The largest purchaser of vehicles hasn't purchased one more vehicle in 18 months right? You wanted proof that they were purchasing electric vehicles, you got it. Over 90% of the vehicles purchased at that time were Chevy volts.Comment is buried, click here to see the rest.
crom99Feb 16, 2012
No, I wanted citations about:
"ghost-buying Volts via stimulus funds for townships and corporate cronies like General Electric."
Additionally:
"some estimates put 20 percent of the Volt’s first-year sales as Big Government purchases."
disappointmentFeb 16, 2012
I've read the study, and the points were valid. The federal and state government's investment totaled $1.5 billion dollars excluding the bailout subsequent purchase of stock.
At the time of the study in question, they had sold ~6000 volts, mostly to corporate fleets which are further tax-subsidized, and government entities. The truth is there in plain text with real numbers - we can project that GM will sell a million this year but the truth will be how well the Volt will sell to consumers. Furthermore, the usefulness of the investments (which were not the bulk of the subsidization - most went toward infrastructure costs including suppliers) in the long term is absurd because unlike other technology investments (like NASA and the NSF) these subsidies are competing with established markets.
crom99Feb 16, 2012
"these subsidies are competing with established markets"
The electric car market was not established. That's the entire point of the subsidy. You can argue that they compete with gas cars, but the same players are making electric cars.
"how well the Volt will sell to consumers"
They're projecting around 45,000 to 60,000 sold for 2012. There's a waiting list for around 54,000, organized by state and country:
http://gm-volt.com/wait-list-data/
pc25Feb 16, 2012
you are the biggest gullible Obama stooge on Digg
Crony Capitalism Digest: General Electric to Purchase Immense Fleet of Chevy Volts That Aren't Marketable in the Real World
http://directorblue.blogspot.com/2011/03/crony-capitalism-digest-general.html
Every once in a while we get a glimpse into GM's Chevy Volt sales and they always remind me of Chris Farley in Tommy Boy.
'How many Volts did we sell, Tommy?' 'Uhm... ni... niner.' 'I can't hear you, you're trailing off and did I catch a niner in there?'
...General Motors lobbied for a $7,500 tax refund for all buyers, under the shaky (if not false) promise that it was producing the first all-electric mass-production vehicle... At least that's what we were once told... GM has continually revised downward its estimates of how far the machine would go before the gas engine fired, and now says 25 to 50 miles.
It turns out that the premium-fuel fired engine does drive the wheels... It's doubtful that GM would have gotten such a subsidy if it had been revealed that the car would do much of its freeway cruising with a gas engine powering the wheels. [After all, a] hybrid is a hybrid, and the Prius no longer qualifies for a tax credit.
http://online.wsj.com/article/SB10001424052748703848204575608323321329514.html
The company will initially buy 12,000 Chevrolet Volts, made by General Motors Co., starting in 2011. GE said it will then add other electric vehicles to its fleet as other car makers expand their offerings. The company said it is in a "strong position to help its 65,000 global fleet customers convert and manage their fleets."
GE plans to buy 1,000 Volts next year and 2,000 to 3,000 per year after that through 2015, GM said. The purchases will comprise a significant portion of GM's early Volt production. The car maker has said it plans to build 10,000 Volts in 2011.
A GM spokesman declined to say if the company now intends to build more Volts, but signaled that may be the case. The GE purchase "won't reduce the number of Volts available to the public," he said.Comment is buried, click here to see the rest.
crom99Feb 16, 2012
"you are the biggest gullible Obama stooge on Digg"
And you can eat a bowl of dicks if this is how you think a discussion works. I didn't even bother with the rest of your comment. Go f**k yourself, troll.
pc25Feb 16, 2012
of course, when you have no facts AGAIN.
There's your corporate cronyism facts, now dispute them hot shot. Guess what you can't.
Closed AccountFeb 16, 2012
http://separatedinmath.blogspot.com/2011/08/return-to-source-philosophy-matrix.html