"The Auto Bailout Saved Millions Of Jobs In One Year Alone"
Taxpayers no longer own any piece of General Motors (GM) after the government sold its last remaining shares in the company on Monday, about five years after it had stepped in to bail out the auto industry. The government’s exit from GM came alongside a new report finding that the auto bailout saved about 1.5 million jobs in 2010 alone.
The GM bailout was the largest component of the overall auto rescue package, with a price tag of $49.5 billion. The stock sales completed Monday recouped $39 billion of that investment for taxpayers and removed the last traces of government ownership that had dogged the company.
A recent report from the Center for Automotive Research (CAR) spells out the economic impact of the auto bailout. The rescue programs saved 2.6 million jobs in 2009 and 1.5 million jobs in 2010. And by saving those jobs and preserving the future of the American auto industry, it estimates that the bailout boosted personal income by over $284 billion from 2009 to 2010.
In the end, taxpayers lost $10.5 billion on the GM rescue — about 0.3 percent of the federal budget and about one thirtieth of what the country loses to tax evasion each year. But the GM portion of the deal actually saved the government money even though the stock sales didn’t recoup the full initial investment. Given what GM’s failure would have cost in terms of higher public assistance enrollment and lost tax revenue, “the U.S. government avoided the loss of $39.4 billion in increased transfer payments and lost taxes in just two years: 2009-2010,” CAR note. That’s over three-and-a-half times the on-paper cost of the deal after Monday’s stock sales.
The company’s North American president told reporters “that a government exit would boost sales, especially among pickup truck buyers,” according to NBC News.