June 29, 2009
GE is quiet bailout recipient
The U.S. Treasury Department is considering closing loopholes that allowed General Electric to participate in a government bailout program, a spokesman said.
GE Capital, the company's finance firm, qualified for assistance through the Temporary Liquidity Guarantee Program, due to its ownership of a modest savings and loan in Utah, The Washington Post reported Monday.
The government has guaranteed $340 billion in debt through the program with a quarter of that issued by GE Capital.
The government has made about $8 billion in fees from the program. However,
we'd like to regulate companies according to what they do, rather than what they call themselves or how they charter themselves, said Treasury spokesman Andrew Williams.
Companies have saved billions of dollars in operating costs through the program shaped in part by GE's lobbying efforts, the newspaper said.
As a financial firm, GE Capital is diverse, loaning money for commercial real estate deals and financing credit cards for retailers, such as Wal-Mart.
In October, Chief Executive Officer Jeffrey Immelt said GE Capital
continued to outperform its peers, even as it lobbied to participate in the bailout, the newspaper said.
But, the government is having second thoughts.
This was crisis management on steroids. A lot was made up on the fly, a source told the Post.