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Obama hails GM's return to Wall Street

Last updated on: November 19, 2010 11:58 IST

Obama hails GM's return to Wall Street

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Lalit K Jha in Washington

US President Barack Obama on Thursday hailed the return of General Motors to the US stock exchanges, saying that one of the toughest tales of the global economic recession had taken a big step towards becoming a success story.

"Today, one of the toughest tales of the recession took another big step towards becoming a success story. General Motors relaunched itself as a public company, cutting the government's stake in the company by nearly half," Obama said at a special White House briefing before he left for the NATO Summit in Lisbon.

"What's more, American taxpayers are now positioned to recover more than my administration invested in GM," he said.

"Last year, we told GM's management and workers that if they made the tough decisions necessary to make themselves more competitive in the 21st century -- decisions requiring real leadership, fresh thinking and also some shared sacrifice -- then we would stand by them," he said.

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Image: US President Barack Obama delivers a statement about General Motors' first day re-listing in the stock market, from the Brady Press Briefing Room of the White House in Washington.
Photographs: Jason Reed/Reuters
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"Because they did, the American auto industry -- an industry that's been the proud symbol of America's manufacturing might for a century; an industry that helped to build our middle class -- is once again on the rise," Obama said.

Noting that auto-makers are in the midst of the strongest period of job growth in more than a decade, Obama said since GM and Chrysler emerged from bankruptcy, the industry has created more than 75,000 new jobs.

"For the first time in six years, Ford, GM and Chrysler are all operating at a profit. In fact, last week, GM announced its best quarter (results) in over 11 years," he said.

"And most importantly, American workers are back at the assembly line manufacturing the high-quality, fuel-efficient, American-made cars of tomorrow, capable of going toe-to-toe with any other manufacturer in the world," he added.

"Just two years ago, this seemed impossible. In fact, there were plenty of doubters and naysayers who said it couldn't be done, who were prepared to throw in the towel and read the American auto industry last rites," he said.

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Image: A Chevrolet Volt electric vehicle sits plugged into a charging station in front of GM's headquarter.
Photographs: Rebecca Cook/Reuters
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"Independent estimates suggested, however, that had we taken that step, had we given up, we would have lost more than 1 million jobs across all 50 states. It would have also resulted in economic chaos, devastating communities across the country and costing governments tens of billions of dollars in additional social safety net benefits and lost revenue," Obama said.

The news was welcomed by several US lawmakers.

"General Motors' initial public offering is a sign of progress for America's auto industry, for our nation's workers, for our manufacturers and our long-term prosperity," said Nancy Pelosi, the outgoing Speaker of the US House of Representatives.

"In the midst of a severe recession, Congressional Democrats and President Obama took difficult emergency action to rescue American auto companies and strengthen critical pillars of our manufacturing sector, while protecting taxpayers.

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Image: A banner hangs at the front of the General Motors Co world headquarters.
Photographs: Rebecca Cook/Reuters
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"Today we have more evidence that those actions are paying off and the American people are one step closer to being made whole," Pelosi said.

Earlier in the day, White House Press Secretary Robert Gibbs said the government's stake in the company prior to the IPO was 61 per cent, but now stood reduced to 26 per cent.

"We continue to be on track to recoup the entire investment made by the Obama administration in the survival of GM and Chrysler and, quite candidly, the entire domestic car industry," he said.

"First and foremost, GM is a clear success. I think it's also clear that when the president made the announcement to do what he believed was necessary, made some tough but needed restructuring decisions at General Motors, there were many who did not believe we'd see this day," he said.


Image: Staff decorate a Buick Regal car at a General Motors auto dealership in Suining,Sichuan province.
Photographs: Stringer/Reuters
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