Obama Rolls Out GM Plan

Posted June 1, 2009 at 11:32am

Updated: 12:48 p.m.

President Barack Obama on Monday formally announced his decision to pump another $30.1 billion into General Motors to help allow the automaker to reorganize under bankruptcy.

The new infusion of cash, added to about $20 billion already provided to the company by the administration, will result in a 60 percent ownership share by the federal government. Anticipating attacks sure to characterize Obama as a quasi-socialist seeking more government intrusion into the economy, Obama portrayed his administration as a reluctant, passive and limited-time owner.

“The government is in the unwelcome position of owning private stakes in companies— in order to ensure their survival and help the economy, Obama said. “What I have no interest in doing is running GM.—

He added that a private team will be in a charge, and “they, and not the government, will call the shots.—

Sensitive to anger among some voters about funding being provided to failing companies, Obama portrayed U.S. assistance to GM and other troubled companies as something that in the long run will save taxpayers money. Obama said he did “not want to spend people’s tax dollars but I want to protect them,— Obama said.

Republicans raised questions about the cost of the deal and its effects on investors.

“While it is a sad day when an American icon like General Motors declares bankruptcy, I am concerned that thousands of hard working Americans who chose to invest their savings in the company had their rights trampled by this agreement,— House Minority Whip Eric Cantor (R-Va.) said in a statement.

“The nature of this bankruptcy agreement raises serious questions about the ultimate cost to millions of Americans,— Cantor said. “In order to make the tough choices required in bankruptcy, the Administration must explain how taxpayer money is being spent, ensure proper oversight, and demonstrate the ability to turn off the taxpayer spigot once and for all.—