Remember how Obama summed up his first-term successes with the pithy “Bin Laden’s dead and GM is alive”? Well, I think reports of GM’s life have been greatly exaggerated.1 Fiat just finished buying out Chrysler, propped up by billions of your tax dollars.
One of the big three, Chrysler was apparently saved by a merger with Fiat, itself a failing car company. It turns out Fiat’s credit rating was already “junk” even before the Obama administration arranged to merge it with Chrysler. Since then, the Chrysler side of the Fiat conglomerate has been much more profitable than the Italian side. And they’ve made money by selling Dodge Durangoes and Jeep Grand Cherokees—not the fuel-efficient cutesters the Obama administration had intended. But even that money has not gone to expand Chrysler’s American operations. It has gone toward keeping Fiat afloat and expanding their production into—you guessed it—China.
And now (Happy New Year!), Fiat has finished buying out its cash cow. I’m sure the American taxpayer will be getting a big thank you note in the mail here soon. So, let’s just recap what has gone down:
- Obama “saved” Chrysler by selling out a portion of the company to Fiat, and not for cash, by the way. For intellectual capital. Which would have been shared anyway, if the companies merged. Stupid.
- Taxpayers spent billions of dollars to bail Chrysler out.
- Fiat, whose own financial situation was dire, responded to billions of dollars of taxpayer injections by expanding Chrysler’s production into China and paying itself to be alive.
- Chrysler ended up being more profitable than Fiat after the merger—by selling their most feul-inefficient vehicles and returning to their traditional American roots—a no-brainer move that did not require either foreign management or intellectual capital.
- Obama takes credit for saving GM. Even while it was pretty much dead to America.
- Fiat finally finishes buying out Chrysler (with money Chrysler itself had largely made, having been kept afloat by U.S. taxpayers).
- Chrysler is now an Italian company operating within the States. Taxpayers basically bought Chrysler for Fiat, and have gotten nothing in return.
Congratulations, America! You’ve been sold out again. I wonder how long it’ll take for you guys to tire of this.
- And for that matter, where’s Osama’s body? [↩]