GOP plan calls for Fed to give GM, Chrysler stock to taxpayers
06-08-2009, 04:49 PM
#1
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GOP plan calls for Fed to give GM, Chrysler stock to taxpayers
WASHINGTON -(Dow Jones)- U.S. Congressional Republicans introduced legislation Thursday to convert the government's investment in General Motors Corp. (GMGMQ) and Chrysler LLC into company shares that would be distributed to every American taxpayer.
The legislation, pushed by four Republican senators, would subvert the Obama administration's plan for the U.S. government to take a 60% ownership stake in GM and 8% in Chrysler. Instead of the government holding the shares, the Treasury secretary would be required to distribute GM and Chrysler stock to the roughly 120 million Americans who submitted tax returns for 2008, said Sen. Lamar Alexander, R-Tenn., the proposal's author. The secretary would have one year to complete the task once GM emerged from Chapter 11 bankruptcy.
"This is the fastest way to get the stock out of the hands of Washington and back into the hands of the American people who paid for it," Alexander said.
The bill reflected growing opposition by Republicans to the administration's car-industry rescue. House Republicans in recent weeks have called for hearings on the use of financial-rescue funds on GM and Chrysler. This week, Rep. Jeb Hensarling, R-Texas, who sits on the congressional panel that oversees the Troubled Asset Relief Program, said the panel will hold a hearing on the matter this summer.
The legislation to give Americans stock in GM and Chrysler has the backing of three other Senate Republicans: Minority Whip Jon Kyl of Arizona, Robert Bennett of Utah, and Judd Gregg of New Hampshire.
Alexander said he hadn't presented the plan to the Obama administration. A Treasury spokeswoman wasn't immediately available for comment Thursday.
Giving ownership stakes of the auto maker to the government will lead to an endless stream of hearings on Capitol Hill that will preclude the companies from making sound business decisions without pressure from politicians, Alexander said. Giving the stakes to taxpayers would return the company to the marketplace, he said.
The legislation, pushed by four Republican senators, would subvert the Obama administration's plan for the U.S. government to take a 60% ownership stake in GM and 8% in Chrysler. Instead of the government holding the shares, the Treasury secretary would be required to distribute GM and Chrysler stock to the roughly 120 million Americans who submitted tax returns for 2008, said Sen. Lamar Alexander, R-Tenn., the proposal's author. The secretary would have one year to complete the task once GM emerged from Chapter 11 bankruptcy.
"This is the fastest way to get the stock out of the hands of Washington and back into the hands of the American people who paid for it," Alexander said.
The bill reflected growing opposition by Republicans to the administration's car-industry rescue. House Republicans in recent weeks have called for hearings on the use of financial-rescue funds on GM and Chrysler. This week, Rep. Jeb Hensarling, R-Texas, who sits on the congressional panel that oversees the Troubled Asset Relief Program, said the panel will hold a hearing on the matter this summer.
The legislation to give Americans stock in GM and Chrysler has the backing of three other Senate Republicans: Minority Whip Jon Kyl of Arizona, Robert Bennett of Utah, and Judd Gregg of New Hampshire.
Alexander said he hadn't presented the plan to the Obama administration. A Treasury spokeswoman wasn't immediately available for comment Thursday.
Giving ownership stakes of the auto maker to the government will lead to an endless stream of hearings on Capitol Hill that will preclude the companies from making sound business decisions without pressure from politicians, Alexander said. Giving the stakes to taxpayers would return the company to the marketplace, he said.
http://www.autoblog.com/2009/06/08/g...-to-taxpayers/
06-08-2009, 08:57 PM
#5
There is no way the government would give up all the power it has acquired. It will keep majority ownership in an attempt to "prevent GM and Chrysler from making the same mistakes that got them to this point." Those who have power are never eager to relinquish it. This bill will go nowhere.
It'll never happen. 
