Skip to main content
  1. News
  2. Politics
  3. Democrat

Report: Obama auto rescue saved 2.6 million jobs and over $100 billion

See also

There was and still is a debate about whether the government intervention into General Motors was a success, but at the end of the day it seems that the country would have been far worse if the government stayed on the sidelines.

Earlier this week, the Treasury Department sold its final shares of General Motors and recovered $39 billion of the $49.5 billion it spent to save the failing Detroit automaker during the recession of 2008. The auto bailout, or auto rescue depending on your thoughts, has been criticized and heavily debated. According the NBC News, the government loss of just over $10 billion is actually more of a positive due to the massive damage the economy would have received if the government didn't intervene.

"The government received 912 million GM shares, or a 60.8 percent stake, in exchange for the bailout in 2008 and 2009. It began selling shares once GM went public again in November 2010, and the pace picked up this year as the stock rose more than 40 percent. Last month, the government said it expected to sell the remaining 2 percent stake by the end of the year.

GM shares rose 73 cents, or 1.8 percent in after-hours trading following the announcement. They rose 1.8 percent in regular trading, at one point reaching $41.17, the highest level since GM's 2010 initial public offering."

Since the bailout, GM has bounded back strongly. After posting 15 straight profitable quarters and tallying up nearly $20 billion, the auto giant has invested just under $9 million in American facilities and added 3,000 new workers. The decision to "bailout" the auto industry was a key component during the 2012 election and helped propel President Obama to a second term. The Republican nominee for president in 2012, Mitt Romney, argued against the auto bailout claiming that it was wrong to lend the industry so much taxpayer money. President Obama rolled the dice and came out a winner and the American people rewarded him with re-election.

A new report by the Center for Automotive Research stated that if the government didn't intervene in the auto collapse, 1.9 million jobs would have been lost by GM alone in 2009 and 2010 along with $39.4 billion in tax revenue and payments made for unemployment benefits and food stamps. The total loss of jobs would have topped 2.6 million if the entire auto industry would have been left to collapse and the report also notes that the bailout "saved or avoided the loss of $105.3 billion in transfer payments and the loss of personal and social insurance tax collections -- or 768% of the net investment.”

Whether the government should or should not have stepped in to save the auto industry is starting to no longer be an argument. The auto rescue had its pluses and minus, but saving over 2.6 million jobs and over $100 billion is a positive that no one can deny.

Advertisement

News

  • Mt. Everest avalanche
    Disaster strikes Mt. Everest as at least 12 people were killed in an avalanche
    Video
    Watch Video
  • Most Earthlike planet discovered
    The Kepler telescope has discovered the most Earthlike, possibly habitable planet yet
    Space News
  • Easter crosses create debate
    Easter crosses spark a debate of separation of church and state in Ohio
    Headlines
  • Chelsea Clinton is preggers
    Former first daughter Chelsea Clinton is pregnant with her first child
    Headlines
  • Stanley Cup playoffs
    The battle for Lord Stanley's Cup is on, don't miss a minute of playoff action
    Sports
  • Ukraine discussed amongst U.S., E.U., Russia
    The U.S., E.U. and Russia agree on ways to diffuse the tension in Ukraine
    Video
    Watch Video

Related Videos:

  • Global Warming, A Disaster In The Making
    <div class="video-info" data-id="518196302" data-param-name="playList" data-provider="5min" data-url="http://pshared.5min.com/Scripts/PlayerSeed.js?sid=1304&width=480&height=401&playList=518196302&autoStart=true"></div>
  • Former U.S. President Bill Clinton
    <div class="video-info" data-id="517300914" data-param-name="playList" data-provider="5min" data-url="http://pshared.5min.com/Scripts/PlayerSeed.js?sid=1304&width=480&height=401&playList=517300914&autoStart=true"></div>
  • Harry Reid doubles down on 'domestic terrorist' comment to describe patriots
    <div class="video-info" data-id="518194513" data-param-name="playList" data-provider="5min" data-url="http://pshared.5min.com/Scripts/PlayerSeed.js?sid=1304&width=480&height=401&playList=518194513&autoStart=true"></div>

User login

Log in
Sign in with your email and password. Or reset your password.
Write for us
Interested in becoming an Examiner and sharing your experience and passion? We're always looking for quality writers. Find out more about Examiner.com and apply today!