GM Spends Taxpayer Money to Lobby for More Taxpayer Money

According to CNBC, General Motors has ramped up its lobbying efforts to the tune of $3.58 million in the first quarter of 2011. This is nearly triple the $1.36 million it spent in the first quarter of the prior year. It is also over double the $1.67 million spent by non-bailed out Ford in the same quarter. The $50 billion that taxpayers gave to bail out GM is now partially being distributed back to President Obama, Congress and a variety of agencies in an effort by GM to, well, receive more taxpayer money.

One of the requests made by GM lobbyists is to increase the number of Chevy Volts that qualify for the $7,500 tax credit from 200,000 to 500,000. At the current rate of sales, that’s about a 100 years of subsidies! It is also an additional $2.25 billion of taxpayer money added to the current $1.5 billion of subsidies already approved. That is an awful lot of money for a vehicle that offers questionable benefits to the environment.

Other areas of handouts requested by GM include pension payment help from the Pension Benefit Guarantee Corp., the government agency that took over responsibility for $6.1 billion of pension obligations to Delphi Corp., GM’s former parts arm. Delphi salaried retirees were treated much more poorly than UAW retirees regarding pensions and benefits retained after the GM bankruptcy process. Congress has recently held hearings on the unfair treatment that blatantly favored UAW members over other classes.

It is absurd that a company that has the US government as its largest shareholder spends millions of dollars to lobby that same government. Treasury should sell its taxpayer owned shares in GM now to avoid such conflicts of interests. Actions like the purchase of thousands of Chevy Volts by the Obama Administration and General Electric (headed by Obama crony, Jeff Immelt) will continue to be questioned as long as Obama has a vested interest in the success of GM as he campaigns for reelection. Any future perceived success by GM may come at the cost of billions more of taxpayer dollars.


Mark Modica is an NLPC Associate Fellow