President Obama told the United Auto Workers (UAW) in February not to listen to critics of the auto bailout who said union members “made out like bandits—that saving the auto industry was just about paying back the unions.” “Really?” Obama said. “I mean, even by the standards of this town [Washington], that’s a load of you-know-what.”
The Treasury Department estimates that taxpayers will lose $23 billion on the auto bailout. Sherk and co-author Todd Zywicki find that none of these losses came from saving jobs, but instead went to prop up the compensation of some of the most highly paid workers in America. They write:
We estimate that the Administration redistributed $26.5 billion more to the UAW than it would have received had it been treated as it usually would in bankruptcy proceedings. Taxpayers lost between $20 billion and $23 billion on the auto programs. Thus, the entire loss to the taxpayers from the auto bailout comes from the funds diverted to the UAW.
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