GM's good news
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It is triumphant news that the U.S. Treasury plans to sell its remaining shares of General Motors stock. The government's announced timetable of divesting all 500 million shares within the next 15 months means that GM ought to be severed from the government in time for the fifth anniversary of the bailout in mid-2014.
Especially encouraging is GM's purchase of 200 million of those shares, which will prop up the share price and translate to more shareholder value.
The Treasury is unlikely to recoup fully the billions of tax dollars used to keep GM afloat. But that should not be the only consideration in measuring the success of the bailout. Had GM gone out of business in 2009, it likely would have cost more than 1 million jobs, which would have inflated the unemployment rate, reduced income tax revenues, ballooned government transfer payments and likely plunged the U.S. economy into a depression.
So there was no other reasonable option. Whatever the ultimate shortfall to taxpayers, the GM bailout was a bargain.
