Whitacre sounds convincing in a down-home sort of way in the TV spot, but the reality is that this statement is a blatant misrepresentation. And Whitacre knows it. He’s probably not worried about that fact, however, because it was endorsed by none other than Secretary of the Treasury Timothy Geithner, who issued a supportive statement saying, “We are encouraged that GM has repaid its debt well ahead of schedule and confident that the company is on a strong path to viability.”
Here are the facts, according to Neil Barofsky, inspector general for the Troubled Assets Relief Program. His most recent quarterly report explained that, “the source of funds for these quarterly [debt] payments will be other TARP funds currently held in an escrow account.”
In other words, as Reps. Darrell Issa, R-Calif., and Jim Jordan, R-Ohio, said in a letter to Whitacre, the GM chairman’s words come “dangerously close to committing fraud. … Your false statements may expose GM to millions of dollars in damages, further reducing the value of the taxpayer-owned company. The American people, as the majority shareholders of GM, have a right to know the truth behind the cost of the GM bailout and GM’s genuine financial condition.” Issa and Jordan are minority members of the House Oversight and Government Reform Committee, chaired by Rep. Edolphus Towns, D-N.Y. The Towns panel should put Whitacre and Geithner under oath and demand to know the facts behind this misrepresentation.
Yet another reason I will never buy a GM vehicle.