- The Washington Times - Thursday, April 29, 2010

ANALYSIS/OPINION:

The Washington Times was right to criticize the Obama administration for its misleading hype about General Motors repaying $6.7 billion of the $50 billion it got from taxpayers (“Government Motors repayment fraud,” Comment & Analysis, Monday). The bailout of GM was unnecessary, and taxpayers will never get their money back.

Most of the $50 billion taxpayers gave the company was converted into overpriced stock that will be worthless if GM goes under. The GM bailout, which is still losing billions of dollars, is similar to a failed British bailout in the 1970s that ruined England’s ailing automakers. GM might have had a better chance of survival if it had just filed for bankruptcy without seeking a bailout, as economists and bankruptcy experts have noted. That would have let GM shed its rigid, costly collective-bargaining agreements with the United Auto Workers union (UAW), which has crippled it financially.

But the Obama administration used the bailout to keep such red tape intact while giving much of GM to the UAW at taxpayer expense and forcing GM to make unprofitable car models. It also inflicted heavy losses on GM’s used-car and parts dealers through a wasteful “cash for clunkers” program that destroyed used cars.

HANS BADER

Senior attorney

Competitive Enterprise Institute

Washington

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