Man Bites Dog …

5 November 2010 at 6:55 am Leave a comment

| Scott Masten |

. . . and government swears it acts politically and is incompetent.

This might just be worth the cost to the U.S. taxpayer of bailing out GM. From GM’s prospectus for its upcoming IPO (via NPR):

…to the extent the UST [United States Treasury] elects to exert such control in the future, its interests (as a government entity) may differ from those of our other stockholders. In particular, the UST may have a greater interest in promoting U.S. economic growth and jobs than our other stockholders. For example, while we have repaid in full our indebtedness under our credit agreement with the UST that we entered into on the closing of the 363 Sale, a continuing covenant requires that we use our commercially reasonable best efforts to ensure, subject to exceptions, that our manufacturing volume in the United States is consistent with specified benchmarks.  (p. 6)

We have determined that our disclosure controls and procedures and our internal control over financial reporting are currently not effective. The lack of effective internal controls could materially adversely affect our financial condition and ability to carry out our business plan.  (p.29)

Now, the next time anyone says otherwise, you have can point to this.

Entry filed under: Bailout / Financial Crisis, Former Guest Bloggers, Public Policy / Political Economy.

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