So what about the rest of our money?
Today General Motors is running ads patting itself on the back for repaying its taxpayer loans.
“We’re proud to announce: We’ve repaid our government loan. In full. With interest. Five years ahead of the original schedule.”
Absolutely true. As far as it goes.
GM has paid back $6.7 billion in direct loans way ahead of the 2015 deadline for repaying those loans.
But there’s still the little matter of the other $45 billion in taxpayer money that went to GM. This cash got converted into shares in the company—a 61% ownership stake in fact—and none of that money has been paid back so far.
And even with the recovery in GM’s fortunes it doesn’t look likely that taxpayers will get all of that back, much less earn a profit on that investment. For us to break even on our GM investment, GM would have to go public again and fetch a value of somewhere north of $70 billion.
How likely is that? Well, Ford Motor (F), which didn’t go into bankruptcy and is at the moment more profitable than in GM, gets a market cap of just under $50 billion today.
I think taxpayers are going to have to wait a tiny bit longer for the rest of their money.
Maybe GM should have skipped spending that money on its self-congratulatory ads and just cut us all a check.