Skip to comments.GM Spends Taxpayer Money to Lobby for More Taxpayer Money
Posted on 07/05/2011 9:06:45 AM PDT by jazusamo
According to CNBC, General Motors has ramped up its lobbying efforts to the tune of $3.58 million in the first quarter of 2011. This is nearly triple the $1.36 million it spent in the first quarter of the prior year. It is also over double the $1.67 million spent by non-bailed out Ford in the same quarter. The $50 billion that taxpayers gave to bail out GM is now partially being distributed back to President Obama, Congress and a variety of agencies in an effort by GM to, well, receive more taxpayer money.
One of the requests made by GM lobbyists is to increase the number of Chevy Volts that qualify for the $7,500 tax credit from 200,000 to 500,000. At the current rate of sales, that's about a 100 years of subsidies! It is also an additional $2.25 billion of taxpayer money added to the current $1.5 billion of subsidies already approved. That is an awful lot of money for a vehicle that offers questionable benefits to the environment.
Other areas of handouts requested by GM include pension payment help from the Pension Benefit Guarantee Corp., the government agency that took over responsibility for $6.1 billion of pension obligations to Delphi Corp., GM's former parts arm. Delphi salaried retirees were treated much more poorly than UAW retirees regarding pensions and benefits retained after the GM bankruptcy process. Congress has recently held hearings on the unfair treatment that blatantly favored UAW members over other classes.
It is absurd that a company that has the US government as its largest shareholder spends millions of dollars to lobby that same government. Treasury should sell its taxpayer owned shares in GM now to avoid such conflicts of interests. Actions like the purchase of thousands of Chevy Volts by the Obama Administration and General Electric (headed by Obama crony, Jeff Immelt) will continue to be questioned as long as Obama has a vested interest in the success of GM as he campaigns for reelection. Any future perceived success by GM may come at the cost of billions more of taxpayer dollars.
Mark Modica is an NLPC Associate Fellow
If the turkeys can get that passed it'll save GM from having to lower the price of their over priced Volt.
Anyone who buys a GM vehicle, condones Obama’s ripoff scheme. GM has been turned into a life-support system for the UAW.
I hate it, because GM used to be my favorite car company. I’ll never buy another.
Of course - that's exactly how "rent-seeking" works.
Myself and many others feel the same.
There’s no better example of corporate welfare than this tax credit for the Volt and GM wants to more than double it. If it were just up to Obama it would be a shoe in.
Look like tax money is like heroin. Once you taste it, you will spend your bottom line to have more. One can only look at congress to see how it rots their minds.
Uh, it's called a KICKBACK and they used to be illegal..
This is exactly how the slime bags in DC launder much of the tax dollars they steel. Mafia, unions and republocrats.
Never. Buying. Another. GM Vehicle. Again.
Almost half of the people in the US Dept of Education are involved in lobbying. We pay them to lobby congress for more money so they can hire more lobbyist to ask for more money.
I won’t either. I am just about done with ford after the recall mess with my van, and having to tow my van out after it was “repaired” (I drove it in. engine went bad in their care)
After that van I bought a 99 Sable wagon. The engine fell out due to a rusted sub frame. Turns out they know. But won’t do anything about it.
Now, I have a 99 Escort. Seems like a good car so far. It’s fords last chance to save me as a customer.
Long ago I swore off car payments so I will NEVER buy a car I have to make payments on.
“If the turkeys can get that passed it’ll save GM from having to lower the price of their over priced Volt.”
GM has already announced a reduction - the base 2012 model will be $39k, with the possibility of the $7,500 subsidy reducing it more.
I strongly suspect that GM will lose money on every Volt sold, and make it up by putting a premium on trucks and SUVs. Most lines sell at a rate of 30 times that of the Volt, so they can spread out the Volt losses over quite a few trucks.
I see this as a signal that the era of personal truck ownership is about over. Ridiculous economy standards will force automakers to reduce truck sales...and they will accomplish this by adding a premium to truck prices, which will in turn subsidize their ‘green’ offerings...which they have to sell a ton of, with their phoney baloney mileage stickers, to meet fleet standards.
The $7,500 tax credit as it stands now will last until 200,000 units have been sold which includes Prius’ and Leaf's.
They may try to make it up in sales of other vehicles but from reports of the amount of loss that was reported around the first of the year per unit they'll have a rough time.
If they can't boost the sales numbers of Volts by a huge amount next year I believe it will be eliminated until they come up with better technology. I also believe the sales will not increase next year the amount needed to save it, it's just too expensive to compete with the other electrics right now.
I too believe Volt sales will continue to be low. Allegedly the plant was closed for a portion of June, to gear up for the 2012 offering in all 50 states...and I imagine there will be some initial buyers in each state, and the numbers will temporarily jump.
Unfortunately, I think GM will persist with this at least until Obama is gone. I project that the Volt program will last 5 years, and GM will finally pull the plug, after the public has had time to discover a) how crappy the batteries get over time, b) how terrible the re-sale value on these turkeys is (despite current projections....seriously, if a third of the car’s value is tied up in batteries, how can it hold its value equally when compared to a traditional car?).
I also think the offering in all 50 states is going to demonstrate some of its flaws very clearly. Any temperature extreme, or road slope extreme, and it doesn’t do very well.
Sadly, however, GM is playing with house money in alot of ways, and they will persist, IMHO...even if it means doing something as dumb as callng for increased gas taxes...which they have already done.
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