Government Motors Says Critics Should Stop Being Political

By Matthew Sheffield | January 27, 2012 | 4:20 PM EST

Cry me a river. General Motors' CEO is complaining that the Chevy Volt has become a "political punching bag."

As the Detroit Free Press reports,

GM CEO Dan Akerson defended the Volt before a House of Representatives subcommittee Wednesday, saying that the hybrid electric vehicle seemed to be under attack as much for political as practical reasons. 'We did not design the Volt to become a political punching bag, and that’s what it’s become,' Akerson said.

The optics of Akerson, CEO of a company whose very existence today stems completely from an infusion of tens of billions of dollars of taxpayer money, whining about political complaints about his company, is ironic, and insulting to the taxpayers who were forced to fund the bailout of GM.

If it were not for tens of billions of taxpayer dollars, GM would not exist today, certainly not in its current form. Years and years of bad management and the harmful impact of the excessive demands of its labor unions brought GM to the brink of oblivion. GM lost market share as customers increasingly preferred products from its competitors.

That's the way it works - you make lousy, overpriced products, you lose customers to competitors who are making products customers want and sell them at prices customers are happy to pay.

That's the way it works in a free market. In this Obamic era of crony socialism, you can make crappy products and keep prices high and still stay in business if you have an ace in the hole. GM's ace in the hole: a unionized labor force that supported President Obama in his 2008 campaign. Once elected, Obama move swiftly to take tens of billions of dollars from the taxpayers and gave it to GM, a payoff to Big Labor for backing him in his 2008 election campaign.

The bailout transferred tens of billions of dollars from the taxpayers to General Motors, money which will never be repaid.

At the same time, Obama's administration created new tax breaks specifically designed to get people to buy Chevy's new electric car, and spent billions of dollars subsidizing the supply chain that provides parts and components for the Volt.

According to a recent research study from the Mackinac Center for Public Policy, total taxpayer subsidies in the Chevy Volt amount to as much as $250,000 per car:

Each Chevy Volt sold thus far may have as much as $250,000 in state and federal dollars in incentives behind it – a total of $3 billion altogether, according to an analysis by James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy. Hohman looked at total state and federal assistance offered for the development and production of the Chevy Volt, General Motors’ plug-in hybrid electric vehicle. His analysis included 18 government deals that included loans, rebates, grants and tax credits. The amount of government assistance does not include the fact that General Motors is currently 26 percent owned by the federal government.

The Volt subsidies flow through multiple companies involved in production. The analysis includes adding up the amount of government subsidies via tax credits and direct funding for not only General Motors, but other companies supplying parts for the vehicle. ... GM has estimated they’ve sold 6,000 Volts so far. That would mean each of the 6,000 Volts sold would be subsidized between $50,000 and $250,000, depending on how many government subsidy milestones are realized."

Politics is the system by which the people make public policy and taxpayer money is divvied up. Given the flood of taxpayer-funded subsidies required in order for GM to put one on the showroom floor, the Volt is the most political car in American history.

The market certainly isn't clamoring for the Volt - sales have been lackluster, with only a few thousand sold. But because the car is the creation of politics rather than market demand, GM continues to increase production.

The Volt may have failed in the marketplace. It owes its existence to politics. If GM's CEO doesn't want the car to be a "political punching bag," he ought to reject the ongoing subsidies and give the taxpayers back their money. He won't do that, of course. He can't sell more than a few thousand Volts at a heavily-subsidized final retail price of $32,500, much less the $50,000 to $250,000 the cars actually cost to make.

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