The Cato Institute reports that those ads from General Motors telling us that they have repaid their loan are not honest or accurate. Here is the ad to which Cato refers:
From the Cato article:
But wait: In the Wall Street Journal, Whitacre says the company has made a $5.8 billion payment to the governments of the United States and Canada. But don’t I recall that the GM bailout was $50 billion? Shikha Dalmia of the Reason Foundation explains the whole story in Forbes: First, part of the bailout went into an “escrow fund,” and that government money is being used to pay back the small part of the bailout that was officially a loan. Second, GM is asking for another $10 billion loan to retool its plants to meet the stiffer Corporate Average Fuel Economy standards, and paying back one government loan — with other government money — will make it easier to get another government loan.
And finally, of course, most of the bailout money was transferred to GM in return for a 60 percent stake in the company. And the taxpayers will get that money back if and when GM becomes a publicly traded company again, provided that the company’s market capitalization is eventually higher than it’s ever been in history. Don’t hold your breath.
These are called GM ads, but they could just as well be called BS ads.
General Motors and Chrysler are dead to me, even if they repay Big Brother for their bailouts. This kind of dishonesty only underscores my dislike for GM.
