Treasury Secretary Jack Lew announced yesterday that the federal government has sold its remaining shares of General Motors stock.
"With the final sale of GM stock, this important chapter in our nation’s history is now closed," Lew said during a conference call with journalists.
At the end, taxpayers invested $49.5 billion in bailing out GM in 2009 and in return received a 60 percent share of the once-mighty corporation. With this final sale, taxpayers recoup all $10 billion of that investment.
Was it worth it?
Lew and his boss in the Oval Office have no doubt about the answer to that question - of course it was because, as the Treasury head said Monday, the U.S. auto industry was saved from collapse, thus preserving an estimated 370,000 jobs.
But hundreds of GM creditors who were essentially stiffed by the government in the bailout in preference to the United Auto Workers union likely see things differently.
So do the 20,000 or so nonunion executives from GM's former parts subsidiary, Delphi, who lost up to 70 percent of their pensions when the government imposed the UAW-favored bailout.
All's well that ends well?
But GM is healthy today, its product lineup has been reinvigorated, product quality is light years ahead of where it was in the pre-bailout era, and the company is once again poised to be a world leader. So, what's the beef?
Here's the beef: Three terrible precedents were set that sooner or later will haunt entrepreneurs, investors and corporate bigwigs: First, long-established bankruptcy procedures that protected private property and investors were thrown out the window. There goes the sanctity of ownership.
Second, the retirement funds of 20,000 nonunion Delphi employees were sacrificed on the altar of the UAW, one of the Democratic party's oldest and most generous funders. So much for equality and fairness.
Finally, the GM bailout represents perhaps the ultimate example of "government picking winners and losers," a process that replaces economic freedom and opportunity with political greed and influence. Only the politicians and the bureaucrats win that game.
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