What the Ford bailout ad got wrong

The next question is different: Is Ford “standing on its own”? Not really.

In September of 2009, the Obama Administration awarded Ford Motors a separate $5.9 billion loan to upgrade manufacturing facilities in the four states mentioned above to improve fuel efficiency, as part of something called the Advanced Technology Manufacturing (AVTM) program. Since the money was given as a loan, the only cost to taxpayers was the “credit subsidy” cost, or the net long-term cost of the loan for the government. At the time Ford got the loan, its credit rating had dropped to CCC+, or “substantial risk,” according to the Government Accountability Office, which meant the loan was more expensive than usual for taxpayers. As of February of 2011, the average credit subsidy rate for companies in the AVTM program was running at 39%. Assuming Ford’s “substantial risk” rating was average, that works out to about $2.3 billion in taxpayer-funded Ford subsidies. Now, this compares favorably to the roughly $14 billion in taxpayer money lost to the bailout of General Motors or Chrysler, but it still comes out to $7.50 for every man, woman and child in the U.S., the price of a good sandwhich.

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