Calling the U.S. taxpayers “reluctant shareholders” (boy does he ever have that right), President Barack Obama unveiled the path to nationalization for General Motors, once an icon of the American private sector.
Apparently, the “path to profitability” that Obama said he would insist on earlier this year didn’t materialize, so now the government is tossing in another $30 billion in taxpayer money – in exchange for a whopping 70% ownership stake in the company.
Worse still, after effectively firing the company’s former CEO and dictating harsh terms to its bondholders (who lost everything), Obama now claims that the federal government will take a “hands-off” approach to the management of the “company.”
No really. Because “hands-off” is the government’s approach to everything, and it’s exactly what you would expect from a new owner who just dropped another $30 billion on top of the $20 billion in taxpayer money that’s already been blown on America’s latest “toxic” asset.
From BizJournals.com:
“This (deal) may give some Americans pause,” the president acknowledged, but it was a better alternative than making more loans to a company that has been “buried under a mountain of debt” for years.
The president said he has “no interest” in running GM.
“The federal government will refrain from exercising its rights as a shareholder in all but the most fundamental corporate decisions,” Obama said. “When a difficult decision has to be made on matters like where to open a new plant or what type of new car to make, the new GM, not the United States government, will make that decision.
“In short, our goal is to get GM back on its feet, take a hands-off approach, and get out quickly,” he said.
Good God. We’re totally screwed, people.
In fact, we’d like to point everyone back to the words of former LBJ staffer Richard A. Posner, who we quoted in this article.
“We should be concerned lest GM become a kind of economic Vietnam, where the federal government throws good money after bad, year after year, in a vain quest for victory,” Posner wrote.
Again, amen to that. Bailing out GM is – quite literally – dumber than a land war in Asia.
By Liberty for me June 2, 2009 at 1:48 pm
We are but just a few years away from surging poverty and out of control inflation because of all these crazy facist moves.I am not sure how bad it will have to get before people rebel,but it will be way too late.Our dumbed down generation has no idea what is going on unless its on MTV, The VIEW or until they have no food or are homless….By the way who is buying HUMMER?? I bet we will be buying our military vehicles from the Chinese…Too ironic Silly Obama,Republics are not for kids
By Dr. Hunley June 3, 2009 at 8:03 am
I bet in a few years we will be much better off, but only time will tell. Our government is not a one man show. There are hundreds if not thousands of people putting in their two cents on what needs to be done to boost our economy. Past mistakes have been overturned and people/businesses are once again buying and selling. This is not the 1800s or even the early 1900s; this is a global economy. A billons dollars now is like a drop in a bucket.
GM auctioned off the Hummer to the highest bidder. It is not like they said ok, lets just give Hummer to a Chinese parts company. Also, if you believe GM Hummer has anything to do with the Humvees our military uses, you are greatly mistaken.