Taxpayers earned gains on GM bailout - outgoing CEO
An Associated Press report said Dan Akerson, the outgoing chief executive officer of General Motors Co, the bailout package extended by the US government using taxpayers' money to the US automaker actually netted a gain despite losing $10.5 billion. Akerson reportedly said that even if GM went under, the company's $26 billion pension obligation will be picked up by the taxpayers, and would result to the government losing billions in benefit payments and tax revenue in the process.
The retiring chief of GM also added that the carmaker will not repay the $10.5 billion loss stemming from the US government's loan as the government had agreed beforehand to extend financial aid and acquire company stock in return. Associated Press noted that GM repaid its loans, with the government selling the remaining stock it has with GM last week. In 2008 and 2009, the US government were said to have shelled out $49 .5 billion to save GM. Reuters said in a separate report that critics insisted that the automaker should have not received a bailout package from the government, with some dubbing the company "Government Motors" after the US Treasury Department inherited a 60.8% ownership stake in the firm initially.
On Monday, Akerson spoke in one of his last appearances prior to his exit from the company. He will be succeeded by the company's product development chief Mary Barra, which will also mark the first entry of a woman as a company chief in the auto industry, Reuters said in a separate report.
On the other hand, Akerson's role in the US carmaker was crucial, as he led the company from loss-making to profit-generating after it declared bankrupt in 2009.
Akerson said that Barra and the management will not be having an easy time to continue the success of GM. He said, "We had to remedy decades of poor decisions and indecisions and 'no decisions' that started to pile up in the 1970s and '80s like so much rotting firewood. We have been fixing the plane while it's in the air."