GM Bailout Cost the U.S. Government $11.2 Billion
The U.S. government yesterday updated the amount it lost on bailing out General Motors during its bankruptcy in 2009. According to Reuters, the government did not recover $11.2 billion of the $50 billion it invested in GM. The U.S. Treasury Department last December sold its remaining shares of GM stock and initially estimated that it had lost around $10 billion.
The revised figure includes the write-off of an $826 million investment in “old” GM.
"The goal of Treasury's investment in GM was never to make a profit, but to help save the American auto industry, and by any measure that effort was successful," Treasury Department spokesman Adam Hodge told Reuters.
The government also spent $12.5 billion to bailout Chrysler and lost around $1.3 billion in that investment. Reuters reports that the bailout saved at least 1.5 million jobs in the U.S. alone. While Ford also faced financial trouble at the time, the automaker eventually recovered without filing for bankruptcy or accepting federal loans.
GM eventually returned to profitability, and recently posted its 17th consecutive profitable quarter. That streak, however, is being threatened by GM’s recent ignition switch recall involving over 2 million vehicles and a growing number of related lawsuits and investigations.