According to the Washington Post, a senior Obama administration official has claimed “I don’t know how much we’re going to get back.” 

The quote was in reference to the federal loans that have, long story short, resulted in government ownership of 60% of the automaker.

In order to cover the so-called loans, GM’s stock would have to be worth at least 68 billion dollars – a number almost twenty percent higher than its 2000 peak of $56 billion.  Given the realities of the United States car market, where more and more companies are carving the overall pie into smaller and smaller pieces, it appears that recouping the investment is all but impossible.

Ron Bloom, an adviser to the Obama’s auto task force, has tried to remain cautiously optimistic, telling a Senate committee “We have certainly looked at scenarios where, over time, a very substantial portion and potentially all of the taxpayer investment in General Motors will be returned.”  However, he then added, “But I certainly by no means would say that I am highly confident that that will occur.”  

The bottom line is this:  If GM’s bankruptcy can shed its debt and position the company so its flagging stock values can start growing again, there is a VERY slim chance that the government can recover its taxpayer-funded investment.  However, they’re going to have to make cars that people actually want to buy, a task they had trouble with before government ownership, and one that looks increasingly difficult now that Congress will have a say in what they produce.

Hmmmmm….not sure that’s gonna cut it.

-Robert Laurie