I’ve noted before how the GM and Chrysler bankruptcies were carefully organized by the Obama administration to give maximum benefits to its union allies and strip them from those who were not in political favor at the time. It was a blatantly corrupt and dishonest process, and I vowed in 2009:
I shall never again buy any new Chrysler or General Motors vehicle or other product, unless and until the issues raised by their bankruptcies have been resolved in accordance with the current (i.e. today’s) law of the land, and any and all benefits unjustly accruing or unfairly transferred to political stakeholders have been nullified and withdrawn forever.
The U.S. government lost $11.2 billion on its bailout of General Motors Co (GM.N), more than the $10.3 billion the Treasury Department estimated when it sold its remaining GM shares in December, according to a government report released on Wednesday.
The $11.2 billion loss includes a write-off in March of the government’s remaining $826 million investment in “old” GM, the quarterly report by a Treasury watchdog said.
The U.S. government spent about $50 billion to bail out GM.
. . .
“The goal of Treasury’s investment in GM was never to make a profit, but to help save the American auto industry, and by any measure that effort was successful,” Treasury Department spokesman Adam Hodge said.
There’s more at the link.
So that’s $11,200,000,000 of US taxpayers’ money down the drain – lost, gone, wiped out. I wonder how many taxpayers consider GM’s survival to have been worth that waste? I certainly don’t!
Even after the bailout and alleged ‘concessions’ by the unions, vehicles made by the Big Three still have much higher labor costs than their competitors. In 2008:
The Associated Press reported that, for example, the average United Auto Workers member makes $29.78 per hour at GM, while Toyota pays its workers (most of whom are non-union) about $30 per hour. However, when total benefits (including pensions and health care for workers, retirees and their spouses) is factored in, GM’s total hourly labor costs is about $69, while Toyota’s is about $48.
Again, more at the link. The bailout hasn’t done much to change that, although new hires are earning much less per hour than their more senior counterparts (who have been protected by the union from cuts in compensation). Meanwhile union fat-cats continue to enjoy extravagant salaries and benefits – far more so than the members whose dues pay for them.
I still see no reason to ever trust GM or Chrysler with my money again. I hope they both fail. It would be no more than poetic justice, given the corruption and political shenanigans that have kept them alive.