Read All About It (elsewhere): GM Bailout Saved a Million Jobs

December 11th, 2013 · 2 Comments · economy, journalism, role of government, Washington

By Arthur Alpert

If you ever doubted the Albuquerque Journal’s passion for passing off its editorial views as news, consider a modest item on the Business Page, Tuesday, Dec. 10, almost at the bottom left. Here’s the headline:

“Feds lost $10.5B in bailout of GM”

And here is the first of its three paragraphs:

“The US government ended up losing $10.5 billion on its bailout of General Motors, but still says the alternative would have been much worse.”

Please note the word “still” with its implication of a stubborn refusal to face facts on Washington’s part.

The remainder of the item says Treasury announced the US sold its remaining GM shares, shares obtained in exchange for a bailout during the financial crisis. And the arithmetic – the bailout cost $49.5 billion, subsequent stock sales earned $39 billion – shows “taxpayers came up more than $10 billion short.”

Got that?

Now let’s look at the Washington Post story. This was in paragraph two:

“The government will lose $10 billion on the deal, which kept the automaker from collapsing.”

Oh, yes, I remember now. That was the goal, wasn’t it?

The Post also wrote:

“Other bailouts, including the rescue of American International Group, have turned a profit for taxpayers.”

Also, the Post quoted Treasury Secretary Jacob Lew:

“Our auto industry was on the verge of collapse, threatening to destroy more than 1 million jobs and cost billions in lost personal savings.”

Jobs? Oh yes, the bailout aimed to save jobs and did.

The Post also noted the TARP program began under President George W. Bush. And taxpayers have profited by some $11 billion.

The NY Times’ account did likewise, putting the overall profit high in the story. The Times also added testimony on what Detroit’s salvation meant to the nation:

“It had to be done because the entire industry was in a depression, and it could have dragged the whole country into one,” said David E. Cole, the former chairman of the Center for Automotive Research in Ann Arbor, Mich.”

Hmm.

So, to sum up:

The Journal omitted why the U.S. government saved Detroit, including the fear of another Great Depression.

It omitted saving more than a million jobs.

It omitted President Bush’s role.

And it omitted Treasury’s profit on the total TARP program.

What’s that you say? There was not enough space?

Of course, how could I have failed to grasp that? It was lack of space that explains the Journal’s misshapen, derisive snort of a story.

Sorry. Please forgive the distaste I conveyed in that last sentence for the politicians pretending to journalism at New Mexico’s largest print daily.

But let me state the conclusion calmly.

In conveying a political judgment against the bailout of Detroit’s automakers, the story confirmed what I argued up top. Yes, the Journal is passionate about costuming its editorial stances as news.

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2 Comments so far ↓

  • Gerard Bradley

    Well, this post is right on, as far as it goes.
    However, as Ha-Joon Chang points out in ’23 Things They Don’t Tell You About Capitalism’ General Motors might not have been in trouble in the first place if they had not spent so much of their profits buying their own stock back in the bubble years. This benefitted management through their stock options but no-one else.
    I admit that the bailout was the best option in 2008-9, given the situation.

  • Roland

    Another reason why I rely on the ABQ Journal Watch for my news and not the ABQ Journal.

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