Shocker: taxpayers probably aren’t going to get most of their auto-industry bailout money back.
AP: Taxpayers face losses on a significant portion of the $81 billion in government aid provided to the auto industry, an oversight panel said in a report to be released Wednesday.
The Congressional Oversight Panel did not provide an estimate of the projected loss in its latest monthly report on the $700 billion Troubled Asset Relief Program. But it said most of the $23 billion initially provided to General Motors Corp. and Chrysler LLC late last year is unlikely to be repaid.
Both GM and Chrysler new shares would have to rise to unprecedented levels for the money to be made back:
For example, GM’s market value would have to reach $67.6 billion, the report said, a “highly optimistic” estimate and more than the $57.2 billion GM was worth at the height of its share value in April 2008. And in the case of Chrysler, about $5.4 billion of the $14.3 billion provided to the company is “highly unlikely” to ever be repaid, the panel said.
“I think they drove a very hard bargain,” said Elizabeth Warren, the panel’s chairwoman and a law professor at Harvard University, referring to the Obama administration’s Treasury Department. “But it may not be enough.”