A top Republican says General Motors’ announcement this week that it will repay its federal loans early is “nothing more than an elaborate TARP money shuffle.”
In a letter to Treasury Secretary Tim Geithner, Sen. Charles Grassley of Iowa fumes that the source of the funds for the $4.7 billion repayment is not GM earnings, but rather a Treasury escrow account. He chides the company and the administration for suggesting in recent statements that the money is coming from GM earnings.
Grassley writes that GM’s early repayment of the federal loan is aimed at diverting attention from another uncomfortable issue – the big break the car company would get on a proposed tax to recoup TARP losses. GM is expected to generate some of the biggest losses in the TARP program, but it won’t have to pay any money under the so-called TARP tax the Obama administration wants to impose on large financial institutions.
Treasury and GM officials don’t dispute that the money to repay the loan is coming from TARP funds. But they said that’s been clearly disclosed.
Grassley: GM Uses ‘TARP Money Shuffle’ to Pay Loans - Washington Wire - WSJ
So not only did GM not repay the full loan (only 40 billion short) the money they did use to pay back the part that would cost them interest on they use MORE taxpayer money!!!