The final tally is in: American taxpayers lost $9.26 billion from the Bush II/Obama-led rescue of the U.S. auto industry.
The Detroit News reports the loss comes out of a total investment by the U.S. Treasury of $79.69 billion used to bail-out General Motors, Chrysler Group, Ally Financial and Chrysler Financial. The department recovered $70.43 billion in profit through share sales, loan repayments, dividends and interest.
The reported final figure comes on the heels of the Treasury's sale of its last 11.4 percent stake in Ally, the automotive lender and bank-holding company formerly known as GMAC Financial. Accounting rules, however, state the government — and thus, the taxpayers — lost $16.56 billion on the bailout, as interest and dividends paid by those rescued were not applied to the principal owed.
The $9.26 billion lost was much lower than the $44 billion projected early in 2009, as well as the $30 billion predicted later that year. Per the Center for Automotive Research and others who supported the bailout, the loss was much preferable over the total collapse of GM and Chrysler, with the former stripping the industry of 1.2 million U.S. jobs, $17 billion lost in Social Security and income taxes for 2009, and $79.5 billion in personal income tossed into the fireplace.
While the government is now out of the automotive business, it still has a small presence in the finance industry: out of 700 institutions who were accepted into the $700 billion Troubled Asset Relief Program in the early days of the Great Recession, 35 are still in the program today. $426.4 billion was invested overall, with the government recovering $441.7 billion; accounting rules, however, state the Treasury has taken $35 billion in losses.
The post US Treasury: Over $9B Lost In Auto Industry Bailout appeared first on The Truth About Cars.
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