Someone help explain this to me…
GM has paid back not quite $7 billion of the $50 billion tab it sandbagged taxpayers with last year – and we’re supposed to cheer the news that GM stock is about to be publicly traded again. That means, some people are about to make money – probably, lots of it – off the issuance of GM stock. CEOs and upper management; major stakeholders; Wall Street shysters.
GM spokespeople say the profits turned will be used for “general corporate purposes.”
But what about the remaining $43 billion and change extracted from the pockets of you and me and every other taxpaying American who works for a living? Why aren’t we being paid back before GM is allowed to start making money off the money we “loaned” it?
Or am I missing something?
You or me, we don’t make payments on our GM car, GM takes the car away. GM (well, GMAC – or your bank) doesn’t care about your problems and certainly isn’t interested in putting off the next payment so you can finance a trip for the kids to Disneyland or put in that new bathroom downstairs. They want the goddamn money. With interest. Right now.
So why does GM get to issue stock and return to lining its pockets before it refills our pockets? Why is there a “free market” for ordinary Americans – but socialism (government bailouts, a generous safety net) for America’s large corporations?
I am not trying to be mean to GM. I like GM’s products.
GM is currently making some of the best cars it ever has; many of them (like the current Corvette, the Cadillac CTS and the new Chevy Cruze) are world-beaters, or at least, among the finest cars in their segments. But GM also still has a whole lotta fat to cut – including at least two arguably superfluous divisions (GMC and Buick) and is guilty of spending money – our money, don’t forget – on extravagant PR boondoggles such as the Leonardo diCaprio Special, the $41k Volt electric car, an “economy” car that costs about as much as new BMW 5 Series.
How is this any different than discovering that Uncle Cleetus – who recently borrowed a pile of money from you to avoid having his double-wide foreclosed on – just went out and bought a new plasma screen TV instead of paying you back?
It needs to be mentioned, too, that a large chunk (perhaps as much as half or more) of GM’s recently posted profits come from its sales in China, a market where the automaker plans to launch at least 10 and perhaps as many as 20 new models over the next few years.
Now, that’s good for GM – but is it good for the American taxpayer, who is subsidizing the operation? Sure, some of the profits eventually make their way back to the U.S. in the form of dividends paid out to shareholders. But how does the average American benefit from GM’s outsourcing of manufacturing to China? Even if he owns some GM stock, the average American would probably prefer his job back instead.
I just don’t get it.
First, Americans are forced to bail out a grotesquely mismanaged company that rewarded its upper echelons most heinously while systematically shafting its pensioners, current workers and customers and losing more than $100 billion over five years. No real consequences for the ass clowns responsible; instead, they got golden parachutes and (in the case of former CEO Fritz Henderson) lucrative monthly “consulting” deals (reportedly, $60k per month for 20 hours’ work, in his case).
Then, after having repaid a tiny fraction of the money taken out of the hides of taxpayers, the company is allowed to “go public” – and start wheelbarrowing in the money once more.
Such generous terms! Such a deal!
Too bad the average American never gets one like it.