Why Do We Need GM to Pay Us Back?

The New York Times has an op-ed today from Edward Niedermeyer, who edits The Truth About Cars, taking strenuous issue with the idea that General Motors will ever be able to pay back the taxpayers’ $50 billion-plus investment in the company. In other news, cats and dogs still don’t get along and day still gives way inevitably to night.

TTAC has been heralding the demise of GM for some time now, so it’s no surprise that Niedermeyer would be shocked—Shocked!—that the New General would dare suggest it can refund some of the money the Treasury has given to it. An IPO in 2010 is also preposterous. But the TTAC about doth protest waaaayyyy too much. How is that GM is even still around!?!? it asks itself. This is like being in a horror movie in which the bad guy/monster/zombie JUST KEEPS COMING BACK.

The hysterical concern that GM might not ever be able to pay back the American people misinterprets what the American people actually sought in bailing out GM. We’re not such a shortsighted nation that we could be convinced, contra-TTAC, that GM should go away, leaving us with another bankrupt automaker, Chrysler, and Ford (F) as the sum-total of our domestic auto industry. We weren’t investing for return, or to break even, but rather to avoid mega-unemployment and, perhaps more importantly, retain some of the admittedly fraught psychological engagement with carmaking culture that GM has always represented.

And of course, Niedermeyer ignores the most obvious aspect of the GM bailout, which is that the U.S. government can lose as much money as it wants, whenever it wants. In times of war and economic catastrophe, this is highly useful and expedient. It may not ultimately match one’s long-held views about the fortunes of industrial enterprises, but there it is. It may not even perfectly align with taxpayer interest, but then again, making the citizenry money isn’t really the government’s job. Exercising the ability to evade crisis is.