Please note: When I write this here, I am not doing it to bad mouth anyone at all. Least of all the UAW or the General Motors or Chrysler workers. It simply is not their fault that the companies that they work for were horribly mismanaged for many years and are now not doing so hot.
As much as I like the fact that my Father did not lose his retirement from General Motors and gets his medical benefits via the UAW’s program that they set up for him. I must acknowledge the truth and the truth is that General Motors and Chrysler were bailed out by the United States Government. One of the tenets of fascism is, in fact, the mingling of private industry and Government.
When the mingling of private industry and Government take place a price is paid. First of all, a company loses its freedom to conduct business as it sees fit. Second of all, the people of said Country usually pay a price in their wallets. Such as the case with General Motors, which happens to be because General Motors was and still is a poorly managed company.
The story via The Detroit News, which is a Conservative/Libertarian slanted newspaper:
Washington — The U.S. Treasury has begun selling the remainder of its 19 percent stake in General Motors Co.
On Jan. 18, the Treasury filed a written trading plan to sell its remaining 300 million shares of stock in the Detroit automaker. It plans to exit completely by March 2014 and said it could immediately begin selling small numbers of shares on the open market.
In a report to Congress, the Treasury said it had net proceeds of $156.4 million in January for the sale of GM stock during eight full trading days.
GM’s stock price ranged between $27.61 and $29.16 during the period, meaning Treasury sold at least 5.4 million shares, depending on the prices it received.
On a quarterly basis, the Treasury plans to disclose how many share of GM stock it has sold and will report monthly its proceeds from the sale.
In December, the Treasury sold 200 million shares of its GM stock to the Detroit automaker for $5.5 billion, or $27.50 a share.
But, of course, there is a cost:
The government needs to get $72 per share for its remaining shares to break even on its $49.5 billion GM bailout. It initially held a 61 percent stake before selling about half of its shares in GM’s November 2010 IPO at $33 a share.
At current prices, the Treasury would lose more than $12 billion on its GM bailout.
Last week, the Treasury Department said its estimate of losses on the $85 billion auto bailout fell by 16 percent, or $4 billion, in large part because of a rebound in General Motors Co.’s stock price.
The Obama administration said in a report to Congress that its projected auto losses fell to $20.3 billion, from its prior quarterly estimate of $24.3 billion.
The Treasury in 2009 initially forecast it would lose $44 billion on its bailout of GM, Chrysler Group LLC and their finance arms. That forecast fell to $30 billion by the end of 2009 and fell as low as $14.3 billion in 2011.
The Treasury still holds a 74 percent stake in Ally Financial, the Detroit-based auto finance firm, as part of a $17.2 billion bailout, but hopes to eventually break even. Ally is shedding its foreign operations as part of its efforts to repay taxpayers.
I bolded some parts of the quoted text above to give you idea of what I am talking about. Up there where it says, “The Treasury”, that means really “The American Taxpayer.” Anytime the United States Treasury is involved in any sort of bailout of private industry, your tax dollars are being used to bail out said company. That is not hatred of President Obama or the Democrats, that is the honest reality of the situation.
Again, this has not about having an axe to grind with the UAW, GM or Chrysler. This is simply a explanation of what happens when Government gets involved with the rescue of two auto companies that were in fact, headed for bankruptcy. The truth is that the American people lost on this deal and lost bad. As much as I respect the history of the UAW and of General Motors, in regards to my family — I must write the truth and this my friends, is the ugly truth.