"Chrylser and GMC Paid Back ALL of The Bailout Money" - Utter Nonsense

Chrylser recently put out the propaganda that they had paid back the US and Canadian debt in full and ahead of schedule - squarely aimed at duping the taxpayers into thinking that it was good deal - when in fact the combined Chrysle/GMC deal has been a dead loser for the taxpayers. In the interest of assuring that this is not a political argument - I won't use the term "bailout" to describe these transactions - because I acknowledge that there are 2 sides of the discussion as to whether the Government should have stepped in and financed the recovery of these 2 companies.

There is not enough space here to explain all of the ins and outs of the Chrysler/GMC transactions but there is not an ounce of fact that supports the widely spread rumor that "Chrysler and GM paid ALL they owed the government back and paid it back EARLY!" What they have done is only pay back the US and Canadian below market interest rate loans (GMC = $8.1 billion; Chrysler = $7.6 billion) - and what is worse - both Companies have taken subsequent government grants - subsidies etc and used those funds to pay back the loans. Bottom line - the loan financing of these 2 companies is a classic example of crony capitalism at its worst - and it is shameful that the Treasury Secretary and our President have chosen to not tell the taxpayers the truth.

The truth is - GMC originally received a total of $59 billion - Chrysler a total of $13 Billion - from the US and Canada taxpayers - mostly in the form of a way overvalued equity investment at the time i.e. not remotely close to the then bankrupt present value. The US and Canadian taxpayers recently sold their equity interest in Chrysler to Fiat at a $1.5 billion loss - that loss will never be recovered. The taxpayers still hold their equity interest in GMC at a current value of $24/share - 60% below the cost of their original investment There is not one financial analyst who believes that the taxpayers will ever recover their "investment" in GMC.

As to the political side of this issue, the truth is - the taxpayers' investment in these 2 companies (that couldn't compete with Toyota and Nissan), is also a dead loser. It was made by politicians who were sucked in by their corporate cronies/campaign contributors - under the false pretense that it would "save American jobs". The assembly plant assets could have been sold to the highest bidder - perhaps with a government subsidized loan - some jobs saved and the 2 companies would have been profitable under new management. As it now stands, GMC is still suffering under the control of the same management who screwed up the Company in the first place - still sucking subsidies from the taxpayers to stay alive. Chrysler is now owned by a 2nd rate Italian auto company - not known for their management prowess. And - Ford who didn't ask for a dime of taxpayer money is the most admired and successful American auto company.

A friend recently posted on Facebook while visiting Detroit - having heard the propoganda published by Chrysler on the radiio about the complete payback of the taxpayer's loan ---  "How many of those stories aren't making the news because all we tend to get is info-tainment"? My answer - "If you want to get accurate news on almost any subject  - don't expect to get it on Detroit radio."