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GM bailout

Taxpayer once again the loser

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I read in the Herald that GM was going to buy back 200 million of the 500.1 million shares now owned by the government as a result of the TARP bailout. This purchase will be at $27.50 a share for a total of $5.5 billion. The government (taxpayers) will lose over $8 billion on this transaction given the original bailout price. But that's not the end of it. The Treasury plans to sell the remaining 300.1 million shares over the course of the next 15 months.
The total losses for all of the sales is expected to reach $28 billion depending on what the shares trade for next year. For the government to break even they would have to sell shares at a very unlikely price of $70 a share. Having been largely freed up from the UAW pension fund crisis and other union concessions Americas mightiest corporation made a $7.6 billion profit in 2011 giving each union member an $8,000 profit sharing check. All the while the taxpayer, many still unemployed, are paying for this. The government and GM have given away the store to the UAW while taxpayers continue to take it in the shorts.
Don Williamson

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