Three years after being rescued by a taxpayer bailout, General Motors (GM) last week announced some rather ambitious profit targets for 2012. But even if it meets these targets -- a big if -- taxpayers should not wait on one foot to recover their remaining “investment” in the company.
There is no doubt that GM has returned from the brink. It made $8 billion last year, a record high, and regained enough global market share to once again become the world’s biggest automaker, a title it had lost to Toyota. More impressive, it is planning to bump its profit margins from 6 percent last year to 10 percent this year, on par with its best-in-class rivals such as Hyundai and BMW. This, it hopes, will allow it to post $10 billion in profits this year, something that only 17 public companies managed to do in 2010.
How did investors react to all this hope and cheer? With a giant yawn: GM’s stock price, which has been hovering around $25 for months, barely budged. That’s $8 below GM’s IPO price. And it’s $30 below what’s needed for taxpayers to recover the $30 billion they still have stuck in the company.
(Please click on the keywords "taxpayer bailout" to read the full article)
The Obama Adminstration and the mainstream media is continuing to put forth the "spin" that the taxpayer bailout of the US auto industry is a success, implying that millions of jobs were saved because of it and the BIg Three Us automakers are now in record profit. What is never mentioned is the fact brought out in the above article, that fact being US taxpayers will lose at least 30 billion dolars in the auto bailout.
GOP candidate former Governor MItt Romney was not in favor of the taxpayer bailout of the US automakers ,opting instead for a re-structured bankruptcy. The Obama Adminstration argued that GM and Chrysler would not have recovered from a bankruptcy, which I thought was a specious argument. After the bankruptcy American's would have rallied around Detroit automakers in the spirit of US nationalism and love for country and would not have been left with billions of taxpayer debt.
Mitt Romney took the right stand in the taxpayer bailout of the US auto industry but because of his weak personality, he doesn't defend his positions very strongly like Newt Gingrinch defends his positions. I don't like Big Unions and I'm glad Tennessee is not a "labor union state". The UAW was the main reason GM and Chrysler was in a financial mess anyway, in my opinion.
Goverment intervention in the Free Market for anything other than to prevent fraud and accidents is bad because a truly Free Market rights Itself and creates wealth without government bailouts and subsidies, something called Liberty ,I think.