GAO: Full Recoup of Government Investment in GM, Chrysler Unlikely(Obama hands our money to unions)
A Government Accountability Office report released Monday is the latest review to cast doubt on the likelihood that taxpayers will fully recoup more than $80 billion invested in the two U.S. automakers.
Government investigators say the U.S. government is unlikely to recover all of its investment in General Motors or Chrysler because the companies’ value would need to “grow substantially above what they have been in the past.”
A Government Accountability Office report released Monday is the latest review to cast doubt on the likelihood that taxpayers will fully recoup more than $80 billion invested in the two U.S. automakers.
Treasury officials told the GAO that they are considering initial public offerings or private sales to dispose of the government’s nearly 10 percent stake in Chrysler and 61 percent share of GM. But government officials won’t say when that could happen because they don’t want to undermine the potential return on the investment.
The report comes on the same day Ford – which did not take government bailout funds – reported a $1 billion net income in the third quarter and forecast a “solidly profitable” 2011.
Ford, the only Detroit automaker to dodge direct government aid and bankruptcy court, said Monday that earnings were fueled by U.S. market share gains, cost cuts and the Cash for Clunkers program, which drew flocks of buyers to showrooms this summer. Ford’s stock rose 40 cents, or 5.7 percent, to $7.40 in pre-market trading.
The latest results signal that Ford’s turnaround is on more solid ground. The company lost more than $14.6 billion last year and hasn’t posted a full-year profit since 2005. While it made a profit in the second quarter, that was mainly due to debt reductions that cut its interest payments.
(Excerpt) Read more at foxnews.com …
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