Rep. Darrell Issa, R-Calif., ranking member of the House oversight and Government Reform Committee stated in a letter to GM CEO Ed Whitacre, Jr. that GM “has come dangerously close to committing fraud and that you might have colluded with the U.S. Treasury to deceive the American public.” What the letter refers to is the recent television ad campaign launched by GM whereby Whitacre is seen announcing the repayment in full, by GM, of their government loans.
While this is not a flat out deception, it understates the case as perceived by the public. In reality, GM received bailout funding of about $50 billion; $43 billion would be converted to a government stake in GM, and $17.4 billion of those funds were put into an escrow account, which was tapped by GM to repay the loan portion.
“Our work is not finished, but repaying our loans with interest is a clear sign that our plan is working, and a critical step toward returning GM to profitability and public ownership,” GM spokesman Greg Martin said. “It’s hard to see how GM’s loan repayment could not be seen as a positive milestone for the company and taxpayers.”
Despite being a critic of GM, Sen. Chuck Grassley acknowledged in a speech on the Senate floor that GM was “˜technically correct” in their statements.
You can check out the commercial after the jump.
– By: Stephen Calogera
Source: Detroit News