What is the government's auto industry bailout costing you? Through the beginning of 2011, U.S. taxpayers will shell out $12,200 for every General Motors vehicle sold and $7,600 for every Chrysler vehicle sold, according to a report from the National Taxpayers Union (NTU).
NTU's report, The Auto Bailout - A Taxpayer Quagmire, expresses in cold cash what the government bailout of the auto industry -- including General Motors, Chrysler, and GMAC -- actually means to American taxpayers, including how much each taxpayer has contributed to the auto industry since December 2008 and how much each vehicle is costing taxpayers.
According to the study, the auto industry bailout has cost the average American taxpaying family about $800 so far. In addition, the report concludes that every GM and Chrysler vehicle sold through the end of 2010 will cost taxpayers $10,700.
"Every time someone in your neighborhood drives home in a shiny new Chevy Silverado, remember that it cost American taxpayers more than $12,000," said Pete Sepp, NTU Vice President for Policy and Communications in a press release. "I wonder if all those Americans without work right now could think of any better ways to spend that money."
The report also says that taxpayer-backed federal loan guarantees made available to GMAC Financial Services through its taxpayer-assisted bank, Ally Bank, will save GMAC about $500 million annually in interest costs.
"Viewed from today's vantage point, the auto bailout is troublesome in a number of respects," states the NTU report. "As already noted, the bailout has become a taxpayer quagmire, escape from which will be a major public policy challenge."
On the Other Hand: What the NTU report does not touch on are the positive impacts on the nation's economy of the auto industry bailout. As U.S. Economy Guide Kimberly Amadeo points out, the auto industry contributes 3.6 percent, or $500 billion annually to total U.S. GDP output and provides 850,000 jobs in auto manufacturing, plus another 1.8 million jobs in auto dealerships. In final analysis, the cost to taxpayers of the bailout must be weighed against the general positive impact of jobs saved and the auto industry's contribution to the ultimate recovery of the economy.
Also See:
Getting Bailouts, Dodging Taxes
Abuse of Bailout
Bailout Abuse Leads to Layoffs
Comments
What about foreign car makers? I was and still for the so-called Bail out. However, I am shocked to see you have not said anything about the foreign carmakers. I was and still not for a so-called bailout for foreign cars. Forging car r money goes back to the foreign country their parts were made. The money for paid for rebates for American cars is spending in this country and keeps workers off the system. The southern US Senators that held out for the foreign car bail out need to be vote out of office.
What about forign car makers? I was and still for the so-called Bail out. However, I am shocked to see you have not said anything about the foreign carmakers. I was and still not for a so-called bailout for foreign cars. Forging car r money goes back to the foreign country their parts were made. The money for paid for rebates for American cars is spending in this country and keeps workers off the system. The southern US Senators that held out for the foreign car bail out need to be vote out of office.
However if the free market were allowed to prosper without government stepping in to “Bailout” a failing industry that failed to evolve with the market changes it would have cost the US Tax payers zero, and another successful auto manufacturer would have stepped in and purchased all the assets for little to none, changed the industry to evolve to market needs and been successful.