How is success measured? In the eyes of the Obama administration, cost plays no role in that equation. It was a year ago that Obama was on a chest-thumping tour to proclaim the great success of the auto bailouts. The Treasury Dept. has revised the amount of the taxpayer’s ACTUAL losses upward by over $9 billion dollars. Not the amount used to bail them out, actual losses. Read the story here.
I’ve also posted on the concocted story about GM and Chrysler repaying their bailout debts early, which is just smoke and mirrors by using accounting tricks shifting funds from one government slush fund to another. Story here.
The Treasury report also expands into the cost of TARP going up due to the revisions. All further evidence that bailouts don’t work. That government shouldn’t be in the business of picking winners and losers (Solyndra anyone?).
Do you have a liberal democrat friend and fervent Obama supporter? Ask them to explain to you why it is OK to bail out failed companies, such as the automakers, yet successful companies are now the target of scorn and jealousy? They don’t mind taking billions in losses through bailouts, but absolutely resent companies that have succeeded and have been providing jobs to Americans. Do you suppose these people would have a problem with the fact that their tax dollars were used to bail out a foreign automaker? That’s what we’ve done in the case of Chrysler now morphing into Fiat.
The bailout nation will soon be taught an unbelievably costly lesson. We are watching it unfold on a smaller scale right now in Europe. The EU is frantically attempting to bailout countries even further to delay the pain and ensure that the fallout is even greater. We here in America will pay that price someday. It’s inevitable.
One can only imagine how much healthier the auto companies would be today had they simply went through the standard process of bankruptcy. Failure would have led to renewed companies being formed without the baggage and the billions of taxpayers money thrown away. The stakeholders who lost their shirts wouldn’t have been discriminated against because they weren’t affiliated with the ‘proper’ political connections. The new companies, with the same workforce hired by the way, would not be empowered with the culture of failure and the knowledge that they can act as irresponsibly as they wish and it doesn’t matter. The U.S. taxpayer will be there for them again.
A large amount of America is ignorant to the true cost of a bailout. It’s not just the wasted taxpayer money. It’s the culture it breeds. Will they recognize it when GM fails again in the future? Not likely as the blame will be shifted somewhere else.