What the government knew or not

In December 2008, the Obama administration repaid the United Auto Workers for their political support by bailing out the nearly bankrupt General Motors. Thanks to the infusion of $49.5 billion from taxpayers, GM was saved from bankruptcy and a restructuring that would have cost UAW jobs and pensions. In the process, the government became GM's largest shareholder.

In December 2013, the government sold the last of its GM stock for a $10 billion loss. Two months later, GM announced a recall of 2.6 million vehicles for faulty ignition switches, which have been linked to at least 13 deaths.

It turns out that GM had hard evidence of the faulty ignition switches as far back as 2007, well before the 2008 bailout. But we are told that neither GM nor the federal government began to investigate these deadly ignition switches until two months after the government sold the last of its GM shares. Really?

How can it be that the government, as GM's largest shareholder, remained ignorant of this problem? What did GM and the government know and when did they know it? Why did they take no action to publicly address the problem until after the government had sold its shares? Was this a case of conflict of interest and willful blindness on the part of the government?

Given that various federal agencies are responsible for protecting the public from defective and dangerous products, how could the government claim with a straight face that it met its legal obligation in regard to GM while it was the automaker's biggest investor?

Recall also that, during its period of ownership, the government forced Toyota, one of GM's major competitors, to recall eight million vehicles for "unintended acceleration." Although this proved to be a bogus issue, Toyota's forced recall benefited GM and helped to protect the value of its stock.

So, after helping its investment in GM by bludgeoning Toyota, the government proceeded to dump its GM stock on unsuspecting buyers just before the ignition-switch recall was announced. That recall, as bad as it was, has been followed in 2014 by the recall of an additional 11 million GM vehicles.

If a private individual with inside knowledge of these kinds of problems and looming recalls had done this, he would be facing a criminal prosecution.

But not to worry. Since GM and our very own federal government did it together, nobody will go to prison, proving once again that, if you are going to engage in criminal conduct, it is always best to make the government your partner in crime.