A former General Motors Chief Executive Officer is urging the United States government to sell its remaining stake in the Detroit-based automaker. As a result of the Treasury Department's 2009 bailout of the GM, the federal government currently holds a 26.5 percent share of the automaker.
In an opinion piece published in The Wall Street Journal on Thursday, former GM CEO Ed Whitacre called on the treasury to sell its remaining stake so GM can shake its stigma of “Government Motors”. Whitacre took over as GM CEO shortly after the company's bankruptcy filing.
"That label, as competitors and GM employees are keenly aware, is code for one thing: 'GM is a failure'," Whitacre wrote. "And while GM might have been a failure three years ago, it's not today."
Whitacre was particularly critical of government regulations that limit executive compensation, which can hurt GM's ability to draw top talent. Whitacre wrote that those restrictions need to be lifted in order for GM to be "a master of its own destiny."
GM apparently shares Whitacre's sentiment. It was reported earlier this week that GM is pressing the Treasury to sell its reamin 500 shares of GM stock in order to lift those pay restrictions. GM also agrees that the public perception of “Government Motors” is hurting the company's outlook.
So far there are no plans in place for the government to sell its stake in GM. At today's stock prices, the Treasury would lose about $15 billion on its bailout of GM, according to Reuters.