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GM Stock Sale: Union Wins, Taxpayers Lose

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By Doug Powers  •  November 28, 2010 09:47 AM

**Written by Doug Powers

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Just to make the story I’ll get to in a minute a little more nauseating, if you haven’t seen it already, view the latest GM ad thanking you, the taxpayer, for helping the company get back on its feet:

You’re welcome, GM. When might we expect our first dividend check?

Helping GM get back on its feet was no easy chore for taxpayers, because union bosses are heavy:

General Motors Co.’s recent stock offering was staged to start paying back the government for its $50 billion bailout, but one group made out much better than the taxpayers or other investors: the company’s union.

Thanks to a generous share of GM stock obtained in the company’s 2009 bankruptcy settlement, the United Auto Workers is well on its way to recouping the billions of dollars GM owed it — putting it far ahead of taxpayers who have recouped only about 30 percent of their investment and further still ahead of investors in the old GM who have received nothing.

The boon for the union fits the pattern established when the White House pushed GM into bankruptcy and steered it through the courts in a way that consistently put the interests of the union ahead of many suppliers, dealers and investors — stakeholders that ordinarily would have fared as well or better under the bankruptcy laws.
[...]
Union claims ordinarily do not receive such special treatment in bankruptcies.

This fairly unsurprising news renders the above GM ad nothing more than the equivalent of having your house ransacked and later getting a touching “thank you for helping me get back on my feet” note from the burglar.

I won’t make too much of a stink about this, or else the next thing you know, the Obama administration will appoint a panel on taxpayer fairness in times of bailout — a panel headed up by the SEIU of course.

(h/t Weasel Zippers)

**Written by Doug Powers

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