GM Repays Government Bailout ... But ....

Today, General Motors paid the government back the last $5.8 billion of the total of $8.1 billion is received in federal government bailout loans. The loan payback came five years ahead of schedule.

Does this mean that Obama and his union thug backers don't own GM anymore? Not by a long shot.

Obama owns 61% of GM, equity from $45.3 billion it received in government grants (as opposed to loans) during the bailout. Canada owns another 12%, from $9.5 billion it loaned/granted to GM as part of the bailout package. GM plans on paying back both governments late this year with proceeds from a stock offering.

Now, theoretically, that will end Obama's government ownership/direction/participation in GM, and return it to its staus as a publicly owned company. I sincerely doubt it. Obama was very carfule in how he orchestrated the bailout of GM. He made sure his people and union people would be running the company. I am pretty certain that he has buried provisions in the bailout agreement that will allow the continued government direction of the company. He is too smart to let it just go back - too big a prize to let go of.

I might end up being wrong on this, but I really don't think so.

Update - Well, hold on a minute ... Sen. Charles Grassley (R-IA) has accused Obama of misleading taxpayers about GM's loan repayment. Sen. Grassley charges that the loan repayment was actually made with other bailout funds - a charge substantiated by the Inspector General for the TARP fund (where the bailout money came from). The repayment was not made in any part from profits GM made by selling cars.

Why would Obama do this? He and Biden have been out crowing to the media how the loan repayment was strong proof that Obama's bailouts are producing spectacular results. Spectacular shell game, more like it.

I don't know if there were any laws broken doing this, but it was immoral, misleading, and stinks ...

Update II - With GM's new boss on TV commercials touting how they paid back their loan 'in full, five years early', the FTC and SEC are getting interested in this. Such a blatant misrepresentation could easily be interpreted as misleading stock holders, investors, potential investors, and GM customers. Making false statements about the financial condition of a public company is a crime ...

Jimmy Hoffa Would be Proud of Him

Obama the Immaculate has accomplished in 100 days what Big Labor couldn't do in a century - turn control of 2 of the big 3 automakers over to the UAW.

GM's restructuring deal, approved by Obama, gives 50% ownership of the company to the federal government. 39% of the company will be owned by the UAW. Current GM stockholders will be allotted less than 1% of the company.

The Chrysler restructuring deal, to be approved by Obama, will give 59% of the company to the UAW, with the federal government getting 30%.

Think of that for a moment ....

Obama and his far left kook fringe will be determining what vehicles these companies will build. The EPA will decide what a large segment of the American car buying public will be offered - what that car buying public wants will be irrelevant.

The biggest problem these companies have had is the high cost of manufacturing vehicles, due directly to high labor costs and bloated union contracts. With the UAW running the companies, do you think the labor costs wil become more reasonable?

If the companies continue to have problems (as they surely will with these clowns in charge), the taxpayers are going to be on the hook for additional bailout money - Obama cannot allow a company failure after His vision has been implemented.

Anyone wanting one of those great looking Challengers or Camaros, a full size GM or Dodge pickup, or a SUV from these companies better go out any buy them now. V-8s will be a thing of the past. All of that is going to be phased out in favor of 3 cylinder plastic econo-boxes running on AA batteries.

Ford's choice to not take bailout money was a great move by farsighted management - they knew what hooks the money would come with. I believe that Ford will prosper in this environment, because they will be free to produce vehicles that the public actually wants to buy. If you have GM or Chrysler stock, dump it quickly. You might want to buy some Ford instead.

This is also going to force far more Americans into the showrooms of foreign car manufacturers.

Obama Fires GM CEO

Obama the Immaculate fired General Motors CEO Rick Wagoner over the weekend. It was actually termed a 'resignation', but Mr. Wagoner was forced out by direction of the White House.

Think of that - the President of the United States just fired the head of a private company.

Wagoner, who has been with GM since 2000, has fought a losing battle against rising labor costs, diminishing market share, and outrageous government interference while trying to keep the GM ship from sinking. Apparently he didn't come up with a restructuring plan that pleased His Highness, so he's gone. Whether he deserves to be sacked or not is completely irrelevant to my point.

Mr. Wagoner reports to a Board of Directors and the shareholders of GM. If he's doing a poor job, it is their responsibility to remove him. The government has no say, no function in that relationship.

One more big step towards socialism, and they aren't even trying to hide this one. Obama has now told private business that they are answerable to him, and that they all work for and at the pleasure of the government.

Scary .... very scary

It's Time for GM to go Under

General Motors' auditors announced that they have severe doubts the company can remain viable. I say ... let it go under ...

The government gave GM billions of dollars to bail them out. It turns out that the money was only a temporary patch to get the company through 3 months. GM is burning through cash so fast that there is no way it can remain solvent, certainly not in this economy.

GM's problems are many, but two stick out like sore thumbs ....

Too many brands - even after dumping Oldsmobile, they still have divisions producing cars and trucks that compete with each other. Pontiac and Chevrolet compete. Chevy and GMC compete on trucks. Saturn is pretty much useless. Hummer is a dead horse in this economy, and with the strength of the 'green' movement. Cadillac stands above, but has suffered from poor quality for years now.

Labor costs - the UAW's strangle hold on the Big Three is killing the companies. Bloated retirement and health care costs for current and especially former employees make their per hour labor costs twice that of foreign manufacturers who build cars here in the US (Nissan, Toyota, etc.). The UAW owns the Democrat Party - no one in the Obama Administration or in Congressional leadership dares hint that the union has to go, or be diminshed, or that benefits gained under threat and execution of strike have to be relenquished.

Stop dumping taxpayer money into GM right now. Let it go into bankruptcy for reorganization. Cancel the union contracts. Drop the brands down to Chevy and Cadillac. It will succeed if organized correctly.

I'm a Ford man through and through. However, the contribution of GM to America's auto heritage is undeniable, and who doesn't like the looks of a restored '69 Camaro tooling down the road? GM is simply not viable in its current form in today's market. Stop wasting our money on a hopeless cause. Let it die, to be reborn.

P.S. - I sure feel sorry for all those lined up for the 2010 Camaro - if something isn't done pretty quick, it will be stillborn .....