Obama Admin Admits: Govt Will Lose $14 billion on Auto Bailout Posted on June 1, 2011 at 12:31pm by Jonathon M. Seidl
WASHINGTON (AP) The Obama administration said Wednesday that the government will lose about $14 billion in taxpayer funds from the bailout of the U.S. auto industry.
In a report from the presidents National Economic Council, officials said that figure is down from the 60 percent the Treasury Department originally estimated the government would lose following its $80 billion bailout of Chrysler and General Motors in 2009.
The reports release coincides with the administrations efforts to tout the bailouts role in the revitalization of the U.S. auto industry after last weeks announcement that Chrysler is repaying $5.9 billion in U.S. loans and a $1.7 billion loan from the Canadian government. Those payments cover most of the federal bailout money that saved the company after it nearly ran out of cash in and went through a government-led bankruptcy.
GM previously announced that it had repaid a little more than half of the $50 billion it received in federal aid.
Treasury Secretary Timothy Geithner said U.S. auto companies are now at the forefront of a comeback in American manufacturing.
We cannot guarantee their success, and at some point they may stumble. But weve given them a better shot, Geithner wrote in an opinion piece in Wednesdays edition of The Washington Post.
While we will not get back all of our investments in the industry, we will recover much more than most predicted, and far sooner, he wrote.
Obama will visit a Chrysler plant in Ohio Friday to tout highlight the companys success.
GM and Chrysler were on the verge of collapse in the final days of the Bush administration after Congress failed to approve an emergency loan package. The Bush administration gave the companies $17.4 billion in loans and required them to develop a restructuring plan by mid-February 2009.
Obamas administration pumped billions more into the carmakers later that spring but won concessions from industry stakeholders, allowing it to push GM and Chrysler through bankruptcy court in the summer of 2009.
Poster Comment:
And I distinctly remember somebody saying the auto manufacturers paid back all the bailout money..... HHmmmmm wonder what Baghdad Bob relative said that????