Obama: Auto Bailouts Pay Off Themselves

Paid off for who?

ASHEVILLE, North Carolina (Reuters) - President Barack Obama said on Saturday taxpayer-funded bailouts of the auto industry that he approved had paid off, in what amounted to a rejection of conservative arguments against such government help.

In his weekly radio and Web address, Obama kept up the pressure for an overhaul of U.S. financial regulations, saying the promising news from the auto industry had not reduced the need for Wall Street changes.

Of course the shell guy in regards to using public money to pay its oblligations is notably missing from his statements.

Via HA:

The backers of the bailouts to General Motors cried with triumph this week when the automaker announced that they had repaid their bailout loans ahead of schedule. That amounted to proof of the wisdom of government intervention, the argument went, and wondered aloud why bailout critics didn’t acknowledge their errors. Perhaps it’s because the government essentially got paid off with even more government money:

During an April 20 hearing on Capital Hill, Sen. Tom Carper, (D-Del.) asked some pointed questions of Neil Barofsky, the “special watch dog” on the Wall Street Bailout, aka, TARP.“It’s good news in that they’re reducing their debt,” Barofsky said of the accelerated GM payments, “but they’re doing it by taking other available TARP money.”…

“It sounds like it’s kind of like taking money out of one pocket and putting in the other,” said Carper, who got a nod of agreement from Barofsky.“The way that payment is going to be made is by drawing down on an equity facility of other TARP money.”

This prompted a stern letter from Senator Charles Grassley (R-IA), who backed the bailouts, to Treasury Secretary Tim Geithner about the shell game being played by the Obama administration and GM (via Yid with Lid, emphases mine):

General Motors (GM) yesterday announced that it repaid its TARP loans. I am concerned, however, that this announcement is not what it seems. In fact, it appears to be nothing more than an elaborate TARP money shuffle.