Barack Obama has some ‘splaining to do about taxpayers’ profitable “investment” in General Motors. It turns out the president is imagining things.
Though Democrats tout the auto bailout as a success, recent reports illustrate the taxpayer cost of the GM auto bailout was substantially larger than the Obama administration and a Congressional Oversight report has owned up to.
“American taxpayers are now positioned to recover more than my administration invested in GM,” President Obama said, according to a piece in USA Today last November. Steven Rattner, former head of the Treasury’s auto task force agreed, telling CNN in November: “Recent progress at GM gives reason for optimism that it may be possible for taxpayers to get every penny back.”
In fact, Investor’s Business Daily reported that even the White House’s Director of the National Economic Council remarked that the Treasury Department Department had a good chance in “recovering most, if not all, of its investment in” GM.
However, a March 16 Congressional Oversight report, tells a different story. It estimates taxpayers will be out of $25 billion. Additionally, the report points out that “full repayment will not be possible unless the government is able to sell its remaining shares at a far higher price.”
That’s only the beginning. Both the White House and the Congressional Oversight report omit the fact that during its bankruptcy, GM got a $45 billion tax break, courtesy of the American people.
GM is driving “away from its U.S.-government-financed restructuring with a final gift in its trunk: a tax break that could be worth as much as $45 billion,” reported The Wall Street Journal last November.
Over one year after the promises President Obama and his administration made about the auto bailout, a February piece on AutoBlog also confirms that GM will also get a $14 billion dollar domestic tax break:
GM will be able to skip its tax tab due to years of massive losses. Companies are typically forgiven a portion of future taxes due to their past losses, but that benefit is typically stripped after an organization goes through bankruptcy.
However, the Obama administration and its allies presently continue to celebrate the success of the auto bailout, regardless of the facts. “I don’t think there’s any doubt that this was a success,” said (H/T Detroit News) acting assistant secretary at the Treasury Department Tim Massad, who oversees the TARP program at Treasury, to a House panel on Wednesday.
In Obama’s world, success mean taxpayers only lost as much as $84 billion.