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Taxpayers will lose around $14 billion in Treasury's sell off of GM stock

By Doug Powers  •  December 19, 2012 02:55 PM

**Written by Doug Powers

In the next 12 to 15 months, the U.S. Treasury will sell all remaining General Motors stock in its possession — over 500 million shares. General Motors will buy back about 200 million of those shares at $27.50 before the year is over. By the time it’s all said and done taxpayers will have taken it on the chin (again) to the tune of about $14 billion:

General Motors plans to buy back $5.5 billion of its shares from the federal government, setting up a $14 billion loss to taxpayers on the company’s bailout.

“This announcement is an important step in bringing closure to the successful auto industry rescue, it further removes the perception of government ownership of GM among customers, and it demonstrates confidence in GM’s progress and our future,” GM Chairman and Chief Executive Dan Akerson said in a statement.

The $5.5 billion stock buyback represents an 8 percent premium over Tuesday’s close, but it falls far short of the $53 per share that would have been needed to get a full payback to taxpayers for the GM bailout.

Naturally all parties involved waited until well after the election to move forward with this bit of news. Now that the union votes have already recorded, the private sector can have GM back now, along with the rest of the tab.

As Joe Biden said back in May, everybody was in on the deal — like it or not.

And just to bring it home, here’s an ad from 2010 featuring then-CEO Ed Whitacre thanking taxpayers and telling them they’d been “repaid in full” five years ahead of schedule:

**Written by Doug Powers

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