Have you driven a Ford lately? That might be a good idea, as it seems that GM's claims to have repaid its TARP loans in full and ahead of schedule are, well, bullshit. Sen. Charles Grassley (R-Iowa) has sent a letter to Treasury Secretary Tim Geithner pointing out that GM has apparently paid back its TARP money with...more TARP money. Here's some of Grassley's query:
During his testimony [Inspector General for TARP Neil] Barofsky addressed GM's recent debt repayment activity, and stated that the funds GM is using to repay its TARP debt are not coming from GM earnings. Instead, GM seems to be using TARP funds from an escrow account at Treasury to make the debt repayments. The most recent quarterly report from the Office of the Special Inspector General for TARP says "The source of funds for these quarterly [debt] payments will be other TARP funds currently held in an escrow account."...
Therefore, it is unclear how GM and the Administration could have accurately announced yesterday that GM repaid its TARP loans in any meaningful way. In reality, it looks like GM merely used one source of TARP funds to repay another. The taxpayers are still on the hook...
rest http://reason.com/blog/2010/04/23/gm-pays-back-tarp-loans-withta
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