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Bonus-Mania at GM

By Doug Powers  •  February 14, 2011 03:32 PM

**Written by Doug Powers

In 2009, when Barack Obama announced that the federal government was assuming a 60% stake in General Motors, the president called the American people “reluctant shareholders” in that company.

As shareholders, when might we expect a dividend check? The general taxpaying public will probably see Justin Bieber on the cover of AARP Magazine before that happens. Taxpayers were so reluctant to hold a share that GM figured we’d also be reluctant to accept a bonus payment — so instead of insulting us again, they’re just spreading it all around amongst themselves:

DETROIT – General Motors Co. will pay more than $189 million in profit-sharing to 48,000 U.S. hourly workers and millions more in performance bonuses to salaried employees, according to company documents obtained by The Associated Press.

GM will pay most hourly workers more than $4,000 each as compensation for its strong financial performance last year, said a person briefed on the bonuses. The payments come less than two years after the automaker emerged from bankruptcy protection with the help of a huge government bailout. They’re more than double the previous record payment of $1,775 in 1999, at the height of the boom in sales of sport utility vehicles and pickup trucks.
The person briefed on the payments did not know the total cost of the salaried bonuses, but it’s likely to top $200 million. Most GM salaried workers make more than $100,000. A bonus of 8 percent, the midpoint of the range, would give them roughly $8,000. That means GM would pay out roughly $224 million.

GM’s bailout-buddy Chrysler is getting involved in the bonus action as well.

At least this might make the union back off a little and just be thankful to have a good paying job in this rough economy, right? Right?

FLINT, Michigan — A local union official said today that potentially record-breaking profit-sharing checks from General Motors would mean a lot to workers, but wouldn’t make up for contract concessions taken over the past few years.

That’s just a local guy though — I’m sure the UAW president will be satisfied… or maybe not:

UAW president Bob King wants to “reclaim some of the $7,000 to $30,000 in concessions each worker gave up since 2005 to help the U.S. automakers survive.” This would, of course, kill the auto companies again in fairly short order, requiring another massive taxpayer resurrection.

Another massive taxpayer resurrection — unfortunately I think that’s the idea.

John Q. Taxpayer, sometimes “thanks” just isn’t enough — but it’s gonna have to do this year:

**Written by Doug Powers

Twitter @ThePowersThatBe

Posted in: Automakers,Unions