Editorial: Lube job

Careful consumers should check under the hood before buying what General Motors is selling in the TV ad touting "repayment" of its government loan.

GM chairman Ed Whitacre says the money was repaid "in full, with interest, five years ahead of the original schedule."

The Obama administration was also quick to trumpet this success. Vice President Biden said last week that GM's paying back "its TARP loan in full, in full, is a huge accomplishment."

Sort of.

Unfortunately, the payment didn't come from a resurgence in car and truck sales. In fact, in the fourth quarter of last year, GM lost $3.4 billion.

The money for the $6.7 billion TARP loan came from a TARP escrow account - a reserve fund the company no longer believes it needs, which is relatively good news.

But the bottom line is, taxpayer bailout money was used to pay back a bailout loan. U.S. Sen. Charles Grassley (R., Iowa) correctly called it "an elaborate TARP money shuffle." Worse, the ad seems to imply that U.S. taxpayers, who still own 61 percent of GM stock, have been made whole. That's not even close.

As originally conceived, GM's bailout package was a $52 billion loan. But that loan was reduced to $6.7 billion, with the remaining $45.3 billion converted to shares of stock. Taxpayers won't recoup the bulk of their money until there's a public stock offering.

When will there be "really good news from GM?", the TARP special inspector general was asked last week. His reply: "I don't have that crystal ball, senator."

If Whitacre and his public-relations team have that crystal ball, they should let the rest of us take a look. If not, they should recall the misleading ad.