TARP Special Inspector General Neal M. Barofsky’s Report Slams the Obama Administration Over Auto Bailout Bungling!

Earlier this week, Neil Barofsky (pictured above), Troubled Asset Relief Program Special Inspector General, issued a scathing report on the Obama administration’s handling of the Auto bailouts last year!

One portion of that report read, "At a time when the country was experiencing the worst economic downturn in generations and the government was asking its taxpayers to support a $787 billion stimulus package designed primarily to preserve jobs, Treasury made a series of decisions that may have substantially contributed to the accelerated shuttering of thousands of small businesses and thereby potentially adding tens of thousands of workers to the already lengthy unemployment rolls - all based on a theory and without sufficient consideration of the decisions' broader economic impact."

Perhaps even more damning is the assertion that race and gender played a significant role in which dealerships got shuttered! "[D]ealerships were retained because they were recently appointed, were key wholesale parts dealers, or were minority- or woman-owned dealerships." (emphasis mine)

So, in order to meet the numbers forced on them by the Obama administration, General Motors and Chrysler were forced to shutter other, potentially more viable, dealerships. The livelihood of potentially tens of thousands of families was thus eliminated simply because their dealerships were not minority- or woman-owned.

As has been widely reported, the Inspector General's study skewered the Obama team for coercing (by threatening to withhold the needed TARP funds) the companies into closing 2,000 dealerships, costing an estimated 100,000 people their jobs during a recession.

But it may be EVEN WORSE than the Barofsky Report details, as earlier last week, a top Obama official, manufacturing czar and "Auto Team" leader Ron Bloom admitted that the dealerships could have been kept open, saving those jobs, "but that doing so would have been inconsistent with the President's mandate for 'shared sacrifice.'"

The Barofsky Report amplified that flaw in saying, "No one from Treasury, the manufacturers or from anywhere else indicated that implementing a smaller or more gradual dealership-termination plan would have resulted in the cataclysmic scenario spelled out in Treasury's response; indeed, when asked explicitly whether the Auto Team could have left the dealerships out of the restructurings, Bloom, the current head of the Auto Team, confirmed that the Auto Team 'could have left any one component [of the restructuring plan] alone,' but that doing so would have been inconsistent with the president's mandate for 'shared sacrifice.' "

Barofsky says the administration insisted on the closings even though a GM official told him that GM would usually save 'not one damn cent' by closing any particular dealership....Furthermore, a GM official stated that removing a dealership from the network does not save money for GM - it might even cost GM money - and that savings cannot be attributed or assigned to any one dealership.

No wonder the Obama administration has been so wary of charges of “racism” lately...