… and it was the United Auto Workers union. The bailout ended up costing taxpayers $26.5 billion, and for what?
Had the government treated the UAW in the manner required by bankruptcy law, taxpayers would have broken even. The program would have amounted to bankruptcy financing instead of an outright bailout. The Administration could have kept the automakers running without losing a dime.
Instead, more than $26 billion went out the door and into the UAW’s pockets. Let’s put that in perspective: The amount of the subsidy given directly to the UAW was bigger than the budget of the entire State Department. It was bigger than all U.S. foreign aid spending. It was 50 percent more than NASA’s budget.
None of that money kept factories running. Instead, it sustained the above-average compensation of members of an influential union, sparing them from most of the sacrifices typically made in bankruptcy—a bankruptcy they contributed to. President Obama engaged in special interest spending at its worst.
The Administration did not bail out GM and Chrysler. It bailed out the United Auto Workers.