GM could be heading for bankruptcy again

GM could be heading for bankruptcy again

President Obama loves to tout the General Motors bailout as the signature “achievement” of his presidency, even though current taxpayer losses on the deal are estimated at over $25 billion.  The exact degree to which the rest of us got soaked so Obama could give GM to his union allies changes constantly as the value of the stock held by We the People fluctuates.  You don’t remember being asked if you would like to become a GM stockholder and willingly accept massive losses to protect highly compensated union jobs, do you?  Well, that’s the great thing about command economics.  It relieves the ruling class of the tedious chores private-sector entrepreneurs face when attracting voluntary investment.

Not only does Obama portray the GM bailout as a great success, he has actually said, in public, that he wants a lot more “successes” just like it.  “I said I believe in American workers, I believe in this American industry, and now the American auto industry has come roaring back,” he told an audience in Colorado last week.  “Now I want to do the same thing with manufacturing jobs, not just in the auto industry, but in every industry.

(Emphasis mine.) That really should have been accompanied by some ominous thunderclaps, or perhaps the “Friday the 13th” musical cue that plays when Jason Voorhees is stalking a victim.  Even if you can swallow the idea that the GM bailout was a “success,” there is literally not enough money in the world for a $25 billion bailout of every industry.  The point of the 2012 presidential campaign is getting delusional liberals to understand that our beyond-bankrupt government doesn’t have enough money to take over any more industries, and had no business taking over industries to begin with.

Unfortunately for Obama, it’s increasingly difficult to pretend the GM bailout was a “success” for anyone but the United Auto Workers.  Earlier this week, Investors Business Daily described the loss taxpayers took for President Obama’s inaugural adventure in crony socialism as “staggering,” a judgment not improved by the recall of 38,000 Chevy Impalas, which are widely used as police cars.  In fact, the only reason GM can post decent sales figures is that government agencies buy a lot of fleet vehicles from them.  Taxpayers were compelled to rescue the company from bankruptcy, then they were compelled to buy its products, and Obama tells them it’s all a smashing “success” that should be duplicated throughout the private sector.  Taken literally, as the President prefers his words not to be taken, this would mean the end of the private sector.

A normal bankruptcy procedure would have spared the taxpayers from this raid on the public treasury, and as IBD notes, it didn’t even “save” jobs in the long run.  Bankruptcy would not have erased GM facilities, or Detroit.  It would have allowed GM to correct the ridiculously expensive labor contracts that caused it to go belly-up in the first place.  Instead, we got large-scale closures of small businesses selling GM cars – a process the TARP Inspector General officially condemned as politicized, with some dealerships “retained because they were recently appointed, were key wholesale parts dealers, or were minority- or woman-owned dealerships.”

And let’s not get started on the ill-fated, heavily subsidized Chevy Volt, which is basically Solyndra on wheels.

Now Forbes tells us GM is probably heading for bankruptcy again.  Its stock price would have to more than double, to $53.00 per share, for taxpayers to recover their “investment.”  Instead, stock values have declined by 39 percent in absolute terms, and 49 percent relative to the Dow average, since GM went public in 2010.  Louis Woodhill of Forbes thinks political considerations would prompt Obama to “ride the stock down to zero” instead of cashing out at a massive loss to the public.

GM’s market share is also falling, as competitors beat its pants off in key vehicle classes.  Disappointing new models will likely yield excess inventory that must be sold off at a loss in years to come.  GM CEO Dan Akerson, who has mused on the record that it would be awfully nice if Obama made gas more expensive with higher taxes so GM’s electric cars would sell better, is “rearranging the deck chairs on the Titanic” in Woodhill’s view, while more innovative and knowledgeable managers at competing companies run rings around him.

Not only does the government lack the money to nationalize all industries, as in Obama’s fever dreams, but it doesn’t have the resources to bail GM out again.  There’s no money for more Solyndras, either.  The absurd fiction of command economics, government-created jobs, and ideologically-driven “investment” must be put to rest, along with Barack Obama’s career, if the American economy is to have a prayer of recovery.

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  • Ed_USA

    Two points:

    1) According to a GM spokesman, ““total government sales for GM in June were still below 5% of total sales“. Obviously GM’s good sales figures were not due solely to that 5%.

    2) Who should our government buy its cars from? Toyota? Hyundai? Tata Motors? Kia? Are you completely against Americans having jobs?

  • reddarin

    Except for maybe special imports aren’t all cars sold in America made by Americans?

  • Ed_USA

    “aren’t all cars sold in America made by Americans?”

    No.

    ‘Kim Custer, spokesman for the Association of International Automobile Manufacturers, which represents Toyota, Mitsubishi, Honda, Nissan, Hyundai, Kia, Isuzu, and Subaru says “In fact, 55 percent of the vehicles our companies sell here are built here,” ‘

    Then there’s the question of where the parts are built….

  • reddarin

    No link?

    But that is very interesting. The meme is always that the foreign brands are built by Americans for Americans.

    Why wouldn’t the Unions point out that information since they are big backers of Buy American.

    You are saying that GM parts are >75% made in America?

  • globalcrap

    An thing his O Bogus regime touches goes bankrupt

  • Friscolady

    Let GM die and with it the damned United Auto Workers Union!

  • WEBIII

    Then there’s the question of where the parts are built….

    That arguement don’t hold water. My first American made car a Ford Bronco II had a Mitsubishi transmission in it. So much for buy American. And no the salesman didn’t inform me of this, i found it out on my own.

    Your quoting articles about the work force in these companies. My job involves working with these various auto companies and I have been through almost every company you mention and you will be hard pressed to find anything but Americans working in them.

  • reddarin

    My bad. You were posting something specific and I forgot what a lying ass you are.

    Here is the real quote:

    “We make them here and they’re built by American citizens and increasingly we’re designing them here,” said Kim Custer, spokesman for the Association of International Automobile Manufacturers, which represents Toyota, Mitsubishi, Honda, Nissan, Hyundai, Kia, Isuzu, and Subaru.

    …and here is more unedited from that quote:

    “In fact, 55 percent of the vehicles our companies sell here are built here,” he said. “More than half of our sales are products made here, and we consider ourselves part of the American auto industry. We have about 95,000 employees around the country.”
    Honda, for example, has manufacturing plants in Marysville and East Liberty, Ohio, in Lincoln, Ala., and last month it opened a plant in Greensburg, Ind., that will employ about 2,000 people. Honda manufacturing facilities employ about 14,000 people in the U.S.

    foxnews com/story/0,2933,465005,00.html

    No wonder you didn’t want to link to it.

  • WEBIII

    You make me glad I jumped in now. I found the same article after I had already posted my reply. I have first hand knowledge of who works in these plants. What that article doesn’t tell you is that Honda of Ohio alone employees over 100,000 Americans indirectly through their manufacturing plants, parts suppliers, car lots, etc… Not very many jobs my arse.

  • reddarin

    I should have known better than to take Ed’s word for anything. If it favors his position he will tell just that much. If it doesn’t shore up his position he’ll cut and paste so that it does.

    Notice how he had to reconstruct the quote to give the appearance of an impartial answer. Same old same old.

    I’m glad you posted. I wouldn’t have thought to check his source otherwise.

  • nancy

    Couldn’t happen at a better time. Who will all the Detroit libtards vote for now?

  • Kevin Leszyk

    They aren’t in a union? You expect someone one to fight for their loss of 30-70 percent of their pensions? This is the reason unions are around to begin with. Otherwise you may be raped and pillaged for corporate profit.

  • Kevin Leszyk

    You mean like Republican’s “You Didn’t Build That”?

  • Kevin Leszyk

    No they split. You just don’t tell the media you are splitting. You file documents with SEC and IRS.. Local areas like Rochester, NY that have Delphi plants know this. Times have been rough since the split.

  • Kevin Leszyk

    Yes Obama told GM to close their Saturn dealerships.. Genius. Next time let me know when Obama tells you to take a piss.

  • Kevin Leszyk

    King Lemming’s last word was Trickle.

  • http://www.facebook.com/people/Larry-Viles/100000555613715 Larry Viles

    Nothing new here- FDR forced the government to buy GM during the depression even though Ford bid lower, because Ford was not a union company.

  • reddarin

    Exactly Kevin.

    The only way for the libs claim that Obama meant roads and bridges to be correct is to rearrange the quote like our dishonest friend Ed_USsrA here.

    Thanks for the back up. I am afraid that Ed is so surly that not many people want to be a victim to his version of reality.

  • reddarin

    “Otherwise you may be raped and pillaged for corporate profit”

    They didn’t get ‘raped and pillaged’ for corporate profit – Obamao screwed them favoring his union cronies by subverting the bankruptcy process.

    Kevin. You don’t really believe the stuff you’ve posted do you? Just having a little fun trolling?

  • randallicious

    “I said I believe in American workers, I believe in this American
    industry, and now the American auto industry has come roaring back,” he
    told an audience in Colorado last week. “Now I want to do the same
    thing with manufacturing jobs, not just in the auto industry, but in every industry.”

    i interpret this to mean obama wants every industry to come roaring back, not that he intends to hit the public sector for $25 billion each time (assuming that number is even accurate).

  • Nateisgreat

    so ridiculous it barely merits a response. Unlike Bush’s BANK BAILOUT and BUSHS 1st auto bailout (remeber you idiots it wasn’t only PRESIDENT Obama bailing things out) the auto industry has largely returned its bailout dollars. the 1 million jobs not lost pays a lot of taxes as well you idiots, what part of WE NEED MANUFACTUring in this country is so difficult to understand for you idiots. You whine about this stuff and ignore the 5 billion plus we give away to subsidize the oil industry and they DON’t need the cash. Already using OUR land *(yes federal lands are in essence tax payer owned idiots) for damn near free to obtain oil. The gear they use and ships are protected by our armed forces at NO CHARGE. I swear you idiots just repeat whatever the conservative media spouts out.

  • Nateisgreat

    Yes surely you and your CONservative sheeple are truly the only intelligent ones left, perhaps you should start your own country on a remote island someplace. I am sure everyone will clamor to go because you folks will perfect the new nation according to your ideals. Make sure you bring Glen Beck, Rush Limbaugh, Hannity and Stupor Murdoch with you or none of you will know what to think anymore.

  • Nateisgreat

    Wow 95 thousand employees compared to close to 1 million working for the big three with higher salaries and better benefits (that they spend in the communities in which they live) seems like the only people you folks worry about making to much money are middle class laborers, cops, firemen and teachers of course….how about you worry more about the top 5% who’ve completely destroyed the middle class, how about you bit*h about how much Romney maks …no its the guys paying taxes and actually working that are a problem, not the millionaires billionaires etc.

  • Nick099

    Imbecile…who do you think built this nation… declared their independence…wrote the Constitution…built the economy and ushered in the Industrial revolution…..Liberal Progressive Marxists???? No! All of those folks were by and large Conservatives of one type or another….those same folks who fought against slavery and Fascism (which is Marxist by the way). They were certainly not disciples of Karl Marx…that failed, petty and jealous leech who mooched off his rich wife and family….definitely not.

    As far as the island thing goes….we already have one… It’s called the the USA. Perhaps it is you and your primitive minded morons that should find their own island eh??? or Perhaps Europe. I hear France is looking great for Marxists these days. Freakin idiot.

  • reddarin

    Nate, you are great!

    Just kidding buddy.

    I haven’t seen you post around here before so I’m gonna take it easy on you my friend.

    Please tell me how you arrive at the number 1,000,000?

    Do you believe that if a company goes into the sort of bankruptcy GM was facing that all jobs suddenly, completely and forever disappear?

    Please tell me what ‘millionaires and billionaires’ mean to you. Do you understand that when Obamao says that phrase he is talking about people that earn $200k? Not millionaires and billionaires?

    Tell me Nate, do you realize that you are being manipulated and flat out lied to by people that want to control you?

  • Nateisgreat

    You are seriously claiming slavery was fought off by conservatives and the industrial revolution was started and funded by conservatives? Somebody needs to learn the actual definition of a Marxist as opposed to the new glen beck angry rights fictional definition of Marxism.
    Perhaps cracking a book or two would help you cure this myopic view of the industrial revolution ….rich doesn’t mean conservative and this belief that somehow anyone with ideas counter to yours is automatically Marxist borders on paranoia.
    I will skip the angry diatribe and petty insults ….name calling and screaming louder doesn’t make your views any more salient and just to clarify as your grasp of geography seems a little shaky as well. These united states aren’t an Island, its part of the continent that is north America and by and large is was created and is made great NOT by its leaders or founding fathers but the every day people both liberal and conservative who live work raise families fight and die in our wars and love this country just as much as you my angry conservative caricature.
    With flawless logic on display like this and friendly inclusive statements like This its little wonder you aren’t the president yourself….indeed how dare I not think just like you and bow to the captains of industry and conservative powers that be for my freedom and very existence. Oh Yeah that’s very Marxist of me isn’t it….don’t you have a bunker you should be building or some gold to hoard before we marxists all come take the guns away and put you in a forced labor camp …
    Wait I am doing exactly what you did…only with irony.

    Sent from my HTC Inspire™ 4G on AT&T

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  • Nateisgreat

    First skip the name calling, it makes you sound petty. It’s President Obama and he has nothing in common with Mao.
    Thanks for going easy on me as I can sense that stunning intellect was going to pounce any second and make me feel badly for daring to open my mouth in the first place….but thankfully you brought your D game to spare my feelings.
    First the domestic auto industry isn’t just those greedy guys working the production lines in Detroit and elsewhere.. its tens of thousands of mon and POP shops, tool and die makers, parts suppliers, truckers, steel companies, etc etc etc and its also those pesky retirees who ya know labored for years ..in most cases 40 years to insure they not only fed and clothed families bought homes etc but also had money to retire on. See they negotiated with the auto companies for these wages and benefits and retirement benefits and going bankrupt would certainly put a damper on those things. Of course its also investors who would get a nice kick in the nads but that’s not even a part of the 1 in 10 jobs that the domestic auto industry effects.
    I sense your brilliance and therefore won’t bother with obvious things like the snowball effect created had not only banks collapsed but banks and the big three as well.
    Pretending only president Obama bailed out the auto industry is also a lesson in creative forgetery. I know your aware of these facts as you went easy on me.
    See Bob down the street lost his job, so he can’t pay judy the banker for his home loan, he can’t buy stuff from Dean the shop keeper, Dean can’t keep up on his rent because Bob the 50 others in his block lost jobs wages or benefits so he closes his doors, now little belinda Deans daughter can’t afford braces anymore and thus her lucrative future modeling career is now ruined. Take that ridiculous analogy multiply it by a factor of ten and stir.
    Hey no worries its not you right and the gov. In Mich is looking great as the state is among the leaders in new jobs thanks to a thriving domestic auto industry he and his party wanted to toss under the bus.
    Oh great debate guru, please continue to go easy on me in the future as well.

    Sent from my HTC Inspire™ 4G on AT&T

    —– Reply message —–

  • Nick099

    Yes…it was Conservatives that achieved those accomplishments…..Marxism…the brand of Progressive nonsense that your side drools over was not even conceived yet. Slavery was fought against by Republicans who can trace their party’s origins to Madison ad Jefferson. Laws enacted after the war to integrate the races were eventually repealed by the Democrat majority in the 1890′s. Later those leaders loosing the dogs and water hoses upon peaceful civil rights protestors in the 50′s and 60′s were ….Democrats all. Jim Crow, Poll Taxes were not a Republican idea…they originated from the minds of Democrats. After all, Lincoln was a Republican, a party that originated from the Whig Party which originated from a faction of Federalists led by Jefferson and Madison.

    Those Founders were ordinary people coming from all walks of life….but they were not “Liberal” as it is commonly referred today. “Liberal” then meant what we would now call “Libertarian”….something that is fundamentally opposed to the Progressive Marxist agenda of many so-called modern “Liberals.”The arguments then were about the powers of the government ALWAYS in the context of a small one. Never did ANY of the Founders believe in an all-powerful government with sweeping authority over the people. In fact from the personal writings of the day….they could almost be considered paranoid regarding any form of government. Hence the creation of a balanced Constitutional government.

    The Industrial revolution was not started by rich people…that is another delusion your ideology is captivated by. It was started by entrepreneurs…many who came from nothing…such as Carnegie and Vanderbilt and Eli Whitney. The so-called wealthy of the gilded age almost to a person came from nothing. They were the ordinary folks. Some of these same folks your side openly vilify today.They brought innovation and wealth and subsequently jobs for many.

    No kidding America is not an island…that was not meant to be taken literally…but I see you only grasp the superficial.

    The Founders were Conservatives all.
    Perhaps it is you that should open a book or perhaps better yet,….get formal training in US History. Imbecile.

  • reddarin

    Wait. Your self-chosen username is ‘NateIsGreat’ and you expect some sort of highly intellectual discourse?

    *And* you babble the most incredibly stupid (D) talking points?

    Do you sense that your silly 1 million number is plain stupid? Do you think that every single business and every single employee would have suddenly disappeared and become unemployed?

    Do you also believe that when a company goes through reorganization bankruptcy that that company, all of its employees, all of its suppliers, all of their employees, all of the indirectly related businesses, all of their employees – they all magically disappear and and every soul becomes unemployed?

    You do believe that this sort of moronic drivel is worthy of a thoughtful response. How interesting.

    Bob huh? lol Spare my your 4th grade butterfly flutters its wings idiocy.

    Sent from my keyboard to an Obamao zombie. Hopefully from another country so he cannot vote for Obamao for a second term.

    :p

    P.S. Obamao

  • Nateisgreat

    Well geez I didn’t know nun of dat dere stuff smart guy. Good thing I had you to set me straight, way to carefully avoid the fact that the bailout in fact worked and as a former employee of a bankrupt fortune 50 corporation I can tell you its not like those jobs magically disperse into the atmosphere except when they do. I do hope you were around to tell all those folks who lost jobs during the banking crisis that “its all ok, those jobs are still around …its just somebody else is doing them now at a different corporation…that’s all”.
    Anyone who claims the country or for that matter Michigan would have been better off if G.M. was allowed to go belly up as opposed to spending less than we spend fueling aircraft carriers and fighter jets for a year to bail them out clearly has a political agenda that has little to do with reality and a lot to do with overdose of right wing group think.
    Its truly amusing when a guy (perhaps) likely sitting in his underpants in his parents basement likes to prove how much smarter he is than 2 seperate presidents economists and oh what ….hundreds, thousands of independant business people, policy wonks, math geeks, egg heads, etc etc have said unequivocally letting our ( not Japans, Germanys, or Koreas but OUR) domestic auto industry die in particular in the midst of an already deep and harsh recession would be insane.
    But of course you and Mittens are Soooo much smarter than the rest of us, I forgot to check if perhaps you were on his short list of economic advisors.

    Sent from my HTC Inspire™ 4G on AT&T

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  • Nateisgreat

    Yes yes you sure have a firm grasp of your history among other things. I could spend days arguing that what you like to call Republicans were completely different animals than the modern day abortion fearing, gun waving, easily offended right wing of today.
    I could also bore you to tears by reminding you that YES democrats or dixiecrats in the south largely were shameless racists and behaved badly.

    but see here’s the thing Zeke.

    Almost All of those folks are on your side now and your parties once proud tradition of inclusive progressive thinking coupled with sound conservative fiscal policy is no longer even vaguely represented..
    I know as do most here that the industrial revolution and many great sweeping changes in history are not the sole providence of either philosophy nor were the key players at any moment in this nations history as ideologically repugnant as you appear to be.
    Indeed if everything great in this world and nation is due to conservatives be they rich or poor then one wonders why we aren’t all bowing at the alter of Glen Beck. Perhaps you’ve mistaken the founding fathers distrust for a centralized powerful government as something more than a natural reaction by revolutionaries after decades of misuse and abuse by royalty.
    Of course the states rights arguments and federalist papers stuff sounds great until you take a moment to realize how complicated it would be to run a a county like the modern united states under that system and a strong centralized government makes that possible.
    So thanks again for your biased skewed view of history. Good thing for conservatives otherwise we might not have existed at all….now even you must realize that’s pure fertilizer. Nope you probably don’t because your far to busy searching right wing web sites and cutting and pasting other peoples skewed flawed views of history and posting them here while claiming to be an original thinker.

    My favorite part of your largely fictional post is when you race to point out how non racist and reasonable Republicans USED to be…now its the 89 % white party with its leaders talking about President Obama as the food stamp president, and literally racing to see which state can get the most conservative, least inclusive immigration and voting laws on the books. Proud party man that you are…oh wait now you will say I’m not a republican…I’m a conservative ( whose never voted for anyone but republicans) like that makes it all better.
    The modern Republican party sure isn’t’ the party of Lincoln hell it’s not even the party of your hero Ron Reagan, he’d be far to liberal in the neocon idiotspeak definition of the word for you folks. Indeed I believe at times Attila the Hun would be somewhere to the left of you people.
    Spare me the revisionist spin on history and your little bo peep dissertation about what that founding fathers thought and felt and your 7th grade history lesson about the industrial revolution ( next you will tell me how Whitney invented the cotton gin no doubt) I will try really hard not to laugh at your personal shortcomings in the human being department.

    Sent from my HTC Inspire™ 4G on AT&T

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  • reddarin

    Nate. You exemplify that old saw that you can’t fix stupid.

    The worst thing about dumbasses like you is that you somehow believe that the imperialism of leftism will magically spare fellow travelers from the baleful eye of the State because you are one of the in-group.

    Obamao subverted the damn bankruptcy process. He didn’t save GM or anyone. He flagrantly *and* illegally broke contract law.

    Success??? You stupid cow, we are in the tank for about $25 BILLION dollars.

    And they are about to go bankrupt. Again.

    I don’t need an ego to feel smarter than you. You provide all the material.

    Listen you moron. GM would have done a Chapter 11 bankruptcy. Not a Chapter 7.

    Pathetic.

  • Nick099

    I noticed you added all the
    usual Marxist propaganda. Reagan could not get elected, guns, abortion, yada, yada. Never include any facts, throw as much junk against the wall and hope something sticks….all to get as far away from the issues as possible….psychopolitics strategy only works amongst your fellow
    primitives.

    GM owned in part or all by the government is a failure. Government partnership with industry is, and has always been a failure. Oh yes, it may all seem well and good on the surface, but the realities are far darker and less beneficial. In the case of GM, many “special” people got rich off the Taxpayer dollar, while the government increased its
    authority to attempt to shape public behavior ( 10 out of 12 on the board appointed by Oblozo), bond holders got nothing, and unions gained power. The result is self-evident: GM’s share price is below 50% since the new IPO and sliding further. Romney was right, had they been allowed
    to go through a normal bankruptcy without government interference GM would have emerged leaner and stronger…but Oblozo had to protect his
    unions who had bought and paid for his allegiance too the tune of $200 million in donations and valuable worker bee support. So once again the whole Nation takes it in the throat to enrich a small faction…how Democratic.

    As for the rest of your blather..it must really be terrible being a 20 watt bulb in a 100 watt world.You are living proof why we should have never banned DDT. Freakin useful idiot.

  • Zhu En Lai

    Long Live Great Mother China !!!!