As the report points out, the Treasury has a few options for divesting the government's interests in the automakers, including public sales and private negotiated sales. But no matter what the Treasury decides to do, the GAO predicts that taxpayers will end up on the losing end:“Because of the particular needs of the auto companies and the unprecedented nature of providing such assistance, Treasury hired or contracted with a number of individuals with expertise in the auto industry, equity investment, and relevant areas of law...Since those agreements have been finalized and the workload has declined, two-thirds of the original professional staff has left...given the wind-down of the auto team—and the associated loss of dedicated staff with industry- and company-specific knowledge and expertise—we are concerned that the Treasury may not have sufficient expertise to actively oversee and protect the government's ownership interests, including determining when and how to divest these interests.”
“Regardless of the sales strategies used, the companies will have to grow substantially in order to reach values at which the Treasury would recover the entirety of its equity investment upon sale of its equity, which the Treasury and others consider to be unlikely.”
I believe that the Treasury needs to find a way to sufficiently explain to Congress and taxpayers how and why a decision was made to sell off the government’s interests. However, I can see this being a significant challenge for an agency that has been less than forthright in explaining the strategy behind its other bailout programs.
http://www.gao.gov/new.items/d10151.pdf
Morgan Duff
What type of explanation do you think the Treasury should present to Congress? I am in agreement they have not been straight forward about their plans and recent programs.
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