Soarer Central: Who will you be Voting for?

Soarer Central Off-Topic Who will you be Voting for?

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Archive through July 24, 2010	Murray Lund	35	1
Archive through August 13, 2010	Steven Anderson	35	1
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Peter Nitschke
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Friday, August 13, 2010 - 06:50 pm, by: Peter Nitschke (Pen)

No matter how you look at it though, GST is only part of the tax/revenue mix.

Would I like GST to go away? Sure, but what will replace that revenue for the government?

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Saturday, August 28, 2010 - 09:47 am, by: Peter Nitschke (Pen)

Murray, something you might enjoy.

http://www.youtube.com/watch?v=m6FNYvC4uyM&feature=channel

http://www.youtube.com/watch?v=9Jlt9lHVS8E&feature=channel

http://www.youtube.com/watch?v=_17ck3Vti8A&feature=sub

Damian Ware
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Saturday, August 28, 2010 - 11:03 am, by: Damian Ware (Frozenpod)

I agree that this huge bubble which will burst as there was no long term focus of sustainability.

They should have for example allowed the US automakers to fail. Sure this looks bad but they have been failing for 10 years it is only a matter of time dispite the injection that they will fail again.

Alternatively you could use the same money to invest in a new industry that will help improve the standard of living, improve efficiency, bennifit the environment and be world leading and sustainable.

This is where the money should be spent, investing in the future no proping up failing businesses.

Steven Anderson
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Saturday, August 28, 2010 - 10:33 pm, by: Steven Anderson (Cusscuss)

Thats a negative way to think of it. Banks maybe could fail but the 3 automakers are absolutely HUGE in the US.

They have almost paid back the loans used to prop them up and are looking at taking the company out of government hands when they can. Not exactly failing and its not guaranteed they will fail again after this scare.

Keeping them in business saved 100,000's of jobs directly, more indirectly and if you didnt spend that money (which will be paid back, so not really spent at all) you would be spending it on unemployment benefits for the masses of unemployed people. Not to mention the lack of taxes these people or the company is now not paying or the social repercussions.

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Sunday, August 29, 2010 - 01:11 am, by: Peter Nitschke (Pen)

Spin versus actuality. See if you can tell which is which.

-------------
April 30, 2010

After General Motors repaid its government loans last week, the automaker released this commercial featuring CEO Ed Whitacre. In it, he advises the American people, "We repaid the loans, with interest, five years ahead of schedule."

This statement has raised the ire of Republican Congressmen Darrell Issa and Jim Jordan, who point as we have, that GM paid back its loans using money from taxpayers, rather than revenue from selling vehicles. They sent a letter to Whitacre yesterday, arguing that the ad constitutes false advertising.

"Deceptive and dishonest advertisements and statements that attempt to disguise what is merely the exchange of one pool of taxpayer money for another pool of taxpayer money as 'real progress' potentially expose GM to charges of fraud and further destroy the credibility of GM with the American public," they wrote in their letter.

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Tuesday, August 31, 2010 - 03:30 pm, by: Steven Anderson (Cusscuss)

if I am getting what they are saying correct, it leaves out a key point being that the 'taxpayer money' they are talking about was paid for shares, would you expect that a company who just did an IPO, then invested that money to be accosted because they bought all that stuff with shareholders money?

Also given that they are ~60% owned by the US government doesnt that mean that they are under control by the shareholders, so it would be the government making these decisions anyway?

Peter Nitschke
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Tuesday, August 31, 2010 - 06:11 pm, by: Peter Nitschke (Pen)

If it was just shareholders investing money, I am sure they wouldn't be carrying on about fraud etc.

Where do you get your information from? GM annual reports?

A little research never hurts.

---------
What are the facts?

GM SIMPLY USED OTHER BAILOUT FUNDS TO REPAY A BAILOUT LOAN.

Yep, taking cash out of one pocket and putting it in another – all of the cash is taxpayer cash – not GM earnings.

GM has at least three outstanding “loans’ made at taxpayer expense. A $60 Billion plus loan that the Government has accepted ”securites for", an $8 billion dollar “cash loan" that GM allegedly repaid and an open ended “escrow account" that provides GM "operating cash" provided by the Obama Adminstration at taxpayer expense.

What did GM do? GM took cash out of the “escrow account" funded by the taxpayers to “payback” the $8 billion dollar cash loan.

Did this “slight of hand" reduce the amount of money GM owes the US taxpayer or reduce GM’s total debt? Heck NO! The “transaction” just changed which account the money was owed to. Just like when people use one credit card to pay another credit card …. a sure sign of financial recovery!

How dishonest of GM, President Obama, VP Biden and the News Media. Shame on all of them!

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Wednesday, September 01, 2010 - 08:01 am, by: Damian Ware (Frozenpod)

As per the video, if the figures were facts and not BS the amount of money that was loaned to them would have paid every single employee of GM and the supply companies $100,000. Surely letting GM fail (I don't believe all the supply companies will go under as most also supply to Ford and other Auto manufactures) and spending the money on building an entire new industry which will provide long term jobs would be of greater benifit whilst being a cheaper option...

Hand out a fortune to support the passed or invest wisely a lesser amount to create a better long term future.

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Wednesday, September 01, 2010 - 01:22 pm, by: Steven Anderson (Cusscuss)

Damian Ware wrote on Wednesday, September 01, 2010 - 08:01 am:
What did GM do? GM took cash out of the “escrow account" funded by the taxpayers to “payback” the $8 billion dollar cash loan.

Did this “slight of hand" reduce the amount of money GM owes the US taxpayer or reduce GM’s total debt? Heck NO! The “transaction” just changed which account the money was owed to. Just like when people use one credit card to pay another credit card …. a sure sign of financial recovery!

Incorrect, it was a debt for equity swap, as I said above, but better said here http://everydayecon.wordpress.com/2010/04/23/more-on-gm/

"According to a report by the Office of the Special Inspector General For the Troubled Asset Relief Program (TARP), GM was given $49.5 billion dollars in accordance with the TARP program. Roughly $19 billion of this disbursement was given prior to bankruptcy and the remaining funds were dispersed during bankruptcy. What’s more (p. 5), “As of November 18, 2009, GM had used about $35.8 billion (72 percent) of the TARP funds…” The document then details how this money was spent. I won’t bore you on the details, but most of the money was spent to cover operating costs.

Regarding the $30.1 billion dispersed during the bankruptcy, a portion of the proceeds of this loan were placed in an escrow account. The escrow account was designed to ensure that the Treasury department could oversee the use of funds. The amount of funds in the escrow account totaled roughly $16.5 billion. GM used a portion of these funds, $2.8 billion, to resolve Delphi’s bankruptcy. This left a remaining balance in escrow of $13.7 billion. Further, as the report indicates (p. 6), “GM officials stated that they intend to seek release of additional escrow funds to repay its outstanding $6.7 billion loan to Treasury and $1.3 billion to the Canadian government.”

So what does all of this mean? Here is a simple breakdown of the disbursement:

* GM received $49.5 billion — $14.5 billion pre-bankruptcy and $30.1 during bankruptcy.
* Of the $30.1 billion, the $16.4 billion was placed in an escrow account.
* $2.8 billion in the escrow account was used to resolve Delphi’s bankruptcy thus reducing the escrow account to $13.7 billion.

In exchange for the disbursement of $49.5 billion, the government received:

* 60% stake in the new GM.
* $7.1 billion in interest bearing debt ($0.4 billion was paid back in July 2009).
* $2.1 billion of preferred stock.

Thus, the through TARP, the government gave GM $49.5 billion in exchange for a mixture of debt and equity. The government can therefore recoup its investment by selling shares of GM stock after the release of the IPO and through the repayment of the interest bearing bonds.

What GM has done is use the TARP money that was placed in escrow by the Treasury Department to repay the remaining interest bearing debt of $6.7 billion. Given that this money was not paid for with profits earned by the company it is effectively a debt-for-equity swap not a loan repayment. In other words, the Treasury approved the repayment of the loan with the escrow funds and the government therefore hopes to recover the remainder of their investment by selling common stock after GM’s initial public offering that is intended to take place this year. As I stated in my previous post, I am skeptical that the government will be able to fully recoup its initial investment through this process.

Thus, to re-iterate, GM did pay back its loan — sort of."

What people still dont seem to get is if they go on as intended the bailout wont cost that much because it will be repaid. If you think that a company as big as GM failing when the county is on the brink of depression wouldnt have had a massive impact you are dead set delusional.

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Wednesday, September 01, 2010 - 09:53 pm, by: Damian Ware (Frozenpod)

Steven Anderson wrote on Wednesday, September 01, 2010 - 01:22 pm:
What people still dont seem to get is if they go on as intended the bailout wont cost that much because it will be repaid. If you think that a company as big as GM failing when the county is on the brink of depression wouldnt have had a massive impact you are dead set delusional.

Yet give them equivillant to 100k per person for not only the direct company but every supply company is a good use of tax payers money.... Keep in mind this is for a industry/company that has been failing for 15 years and will never be able to compete with overseas car makers.