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National Taxpayers Union Assails GM over Opel

The "illogic" is flawless and could cost you more money.

by on Nov.10, 2009

A successful Opel in Europe, a successful Buick in China, and a natural to come ot the U.S. So why are we against an Opel reorganization?

A successful Opel in Europe, a successful Buick in China, and a natural for the U.S. So why are we against an Opel reorganization?

The National Taxpayers Union (NTU) is urging European governments to reject GM’s request for funding its reorganization of Opel.

This presumably will hasten GM’s demise and increase the chance that taxpayers will loose their entire investment in GM. The latest criticism comes at a time when GM is showing some signs, albeit small ones, of regaining momentum.

The conservative NTU was also an opponent of the original auto bailout plans, and — as a vocal proponent of the “Let GM Fail” ideology,  NTU then went on to excoriate GM’s 60-day money back guarantee program, which is actually increasing consideration, sales and contributing positively to the bottom line.

Now NTU Vice President for Policy and Communications Pete Sepp is offering the following comments regarding GM’s Opel restructuring decision. GM’s latest plan has GM retaining Opel instead of selling it off and losing control of vital engineering and design resources.

“In order to do that, GM has requested $4.43 billion in taxpayer bailouts from European governments, including Germany, Poland, the U.K., and Spain. Incredibly, Opel already has $2.23 billion in loans from the German government to keep it afloat,” Sepp claimed.

Well, not quite, Sepp. First off, these are all loans. Back in late May, the German government provided a bridge loan to Opel, which at the time was within days of running out of operating cash. Opel still owes the government about €900 million of €1.5 billion advanced but improvements in its operations and an increase in sales have allowed GM to pay some back already.

Secondly, GM has not publicly revealed its revised plan, which is being discussed with European governments this week and next, but it will likely involve more loan guarantees.

Global Outlook!

Global Outlook!

In other areas, Sepp mirrors rigid conservative ideology, which would rather see GM fail, than succeed.

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Bailout Critics Decry New GM Guarantees

GM can’t win for losing in latest rant?

by on Sep.15, 2009

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"General Motors' new 60-day money back guarantee campaign seems to offer something for everyone, except taxpayers."

General Motors Company’s new money-back guarantee has come under fire from the National Taxpayers Union, which charges that GM is using the money from the $49 billion Federal bailout to campaign to finance it.

“General Motors’ new 60-day money back guarantee campaign seems to offer something for everyone — except taxpayers, said Vice President for Policy and Communications Pete Sepp of the 362,000-member National Taxpayers Union

The negative comments followed the rollout of the new advertising campaign featuring GM’s new chairman Ed Whitacre, strolling through the GM Design Center in Warren, Michigan and drawling in an English-like dialect.

The conservative NTU was an opponent of the original bailout and — as a proponent of the “Let GM Fail” school of thought — it not surprising that it criticized the new plan, which is unusual in the automobile business where the value of a vehicle drops dramatically once it leaves the dealer’s lot.

“Normally a strategy like this would be a bold move to compete in the marketplace, one that consumers and shareholders ultimately decide to reward or punish. Unfortunately, with this 60% government-owned company, taxpayers don’t have the option of ‘pulling out’ of GM and putting their investments elsewhere; unless, of course, they’d like to be prosecuted by the IRS and spend a few years in jail,” Sepp incoherently noted.

Sepp also referred to a recent Congressional Study that says that it’s doubtful the Federal loans to GM and to Chrysler will ever be repaid. Of course, under his illogical way of thinking, if GM fails, then taxpayers will incur a huge loss and their taxes will have to increase to cover the unpaid debt.

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