there seems to be investor concern about whether they have spurred that change rapidly enough. host: when you say culture, it does that mean that decisions about what kind of cars are built or does it go further than that? guest: exactly. it also comes down to making decisions rapidly, how quickly is gm making decisions? how many lawyers does something have to go through before it is decided -- how many layers does it have to go through before it is decided? one thing that has puzzled analysts and investors is the alliance with peugot in europe. gm says this would allow them to share development costs with the french car maker that has gone

through the same struggles as of the automaker in europe has been a lot of those things you will not see until 2017, five years out. analysts and investors were puzzled. this -- there seem to be more pressing issues now. gm was shopping for a long-term solution with peugot. things like that are not being clearly articulated to wall street. that is affecting the gm share price. host: we're talking about the treasury department report. the bailout could cost taxpayers about $25 billion. steve joins us from detroit for the discussion. if you want to ask a question, we have numbers to call.

the first call comes from nevada. the republican line, good morning. caller: i want to ask the woman he was having --you was having, what does she think about obama bragging about the bailout of gm if there's going to be $25 billion we will not get back? we own 500 million stocks right now. it is valued at $20. until we get our money back --

host: ok, go ahead. guest: this is a great question. the bailout has become fodder for political debate. with the obama administration taking credit for the bailout and calling it one of the unmitigated successes. the romney campaign is really criticizing it. i think the caller brings up an interesting point. the gm stock price has foundered since its ipo in the fall of 2010. we are looking at a $25 billion loss. it is important to remember the loss estimates fluctuate on the gm stock price. it is important to also way the white house response. that is the bailout was not intended to make money for u.s. taxpayers. it was intended to preserve jobs. the white house and senate both predicted about 1 million jobs

were saved by the bailout when you are weighing 1 million jobs versus a real risk to the economy, which is what bankruptcy of gm and chrysler would have entailed during a recession, the white house thinks it was worth it. they think about the 1 million jobs saved. they say it is worth it even though we will take a hair cut. the caller is right. we're definitely taking a hair cut. the treasury still owns 500 million shares. they wanted to exit by now. that does not seem to be practical given where the stock price is. they were looking to maximize returns to the extent possible. we will always be looking at a cost. host: a question about the vote and how that is going. -- a question about the volt in-house sales are going. guest: this became the centerpiece of the ipo offering a few years ago.

i do not have exact figures for sales, but last year, they fell short of expectations. it is hard with vehicles like the volt which embraces new technology. americans have been slow to adopt this technology. they're still expensive because of battery costs. they are out of the reach of most americans. they seem to ebb and flow with fuel prices. it is unpredictable. earlier this year, gm refrained from giving too many expectations on the volt. last year, they sold less than half of what they predicted in 2011. it is hard to say how they are

doing. we do not have the full year estimate or out what to compare it to. the fact that gm fell short last year and has refrained from giving any outlook this year on sales indicates they are starting to see this is still a burgeoning area for sales. bes and hybrids will always tricky to sell to the american public. we're in the opening of this particular trend. host: john, go ahead. caller: about 10 years ago, and read an article about how the outcome of a pre-arrange bankruptcy with the government would be. the long and short of it is that this stock was a hybrid stock. the american taxpayers did get the shaft. i agree with the previous caller.

all of the congress got paid back 100% on their purchases. they were right on the money, barron's knew exactly what was going to happen. what happened was this was a hybrid. it was a debt instrument. stockholders were supposed to be wiped out. everybody but the unions got wiped out. however, that is not true. i expect there would be an examination and investigation of how this could have happened when a few people like myself do their homework, really got the shaft. host: go ahead. guest: the callers experience is unfortunately, across the board. a lot of people lost a lot of money. that is a hallmark of this particular bail out.

the pain is shared across the board. the caller brings up that everybody but the unions seemed to get the short end of the stick this time around. this is a common perspective. we hear is a lot. do we hear a lot. -- we here in a lot. people say it is not necessarily true. the unions did take a lot of concessions. they almost balked at the deal. some of the choices they have to make were really tough. you are talking about the elimination and closure of factories, the loss of jobs, the elimination of the jobs bank. that is one of the most significant concessions the uaw had to make during the bailout talks.

that is the policy that allowed workers to get 95% of their pay indefinitely if they were idle. i understand the caller's anger. it is widespread. a lot of people lost a lot of money. currently, there are people frustrated because they bought into the gm ipo at $33 a share. they bought early on. they are seeing the value of those shares under water. the anger he is expressing is common and valid. a lot of people share it. host: $80 billion spent rescuing gm and chrysler. the u.s. currently holds about 500 million shares of gm stock. no sales are planned before the november election. this is king george, virginia, kenny on independent line. caller: i love to watch c-span

on weekend mornings. it is sometimes the highlight of my weekend. i have to make a comment about the last session about immigration. i would think with -- is msnbc taking over this network? let's not do this again. thank you. host: bill, hello. caller: thank you for taking my call. i have a question and like to make two comments. the first comment is about the volt. i worked at that plant and retired in 2008. the government forced them to push it out too fast. the second comment, thank you, america, for taking care of my pension. i appreciate it. the steel workers and others will appreciate help.

they did not get none. they did not have the political power, i guess. they offered bailouts to salary workers at ford and gm, do you think they will do it with the [unintelligible] guest: yes, i do. in the last contract round in 2011 that ended about a year ago, there is a side letter in the gm contract which opens the possibility of a discussion between the union and gm about ways to eliminate pension obligations. that would be to hourly workers. the caller is talking about a pension buyout initiated by ford and gm earlier this year. the pension problem is an extraordinary issue for gm and ford, gm, ford, and chrysler, but gm and ford have been in the

news recently. to offer one staggering statistics, for the 15 years that ended in 2006, gm put $55 billion in to worker pension plans and only paid $13 billion in dividends. it is true that the gm pension risk is the largest of any company in the s&p. earlier this year, both gm and ford made significant inroads in trying to get this risk of the table. gm did it with salaried workers, the white-collar workers, engineers and the like. they shifted $26 billion in obligations over to prudential and offered buyouts to about 42,000 of those salaried retirees.

about 118,000 retirees and their dependants were affected. they'll still get monthly pension checks, but they will be from provincial and not gm. the hourly workers represented by the uaw represent the lion's share of the pension risk. that is 440,000 people that get monthly pension checks from gm. it is a sensitive issue. workers joined gm because they thought they would be protected for life. a lot of them did not go to college because they decided not to take other opportunities because they were promised lifetime security by gm and ford. the idea of 30 plus years later having to -- being asked to forgo that right and promise is tough to swallow for a lot of people.

at the same time, these companies have a responsibility to investors to manage the company in a way that is fair and intelligent. the pension risk is one of the top risks to gm stock. the side letter in the contract last year between gm and the uaw opens the possibility of discussion that there could be buyouts. my understanding is employees represented by the uaw would not go for this. at the annual shareholder meeting, this is something they would like to do. the former head of the auto task force says the same thing.

this would be a smart thing for the uaw to consider. it is a conversation to come in years to come. host: off of twitter, consumers are the real job creators. speculation is fruitless. mark is on the republican line. go ahead. caller: my name is mark ewing. in december, i decided to run for congress. i withdrew in march because of the redistricting debacle we went down here.

my retirement plan, i had some investment in the ventures for gm. we got in low. i sold out of everything after the two-year holding period. when the issue stock, i got out as soon as i could. i recognized having the government in there was bad. one of the concerns i have is the priority system we have up in bankruptcy today. one of the problems we have is they put retirement first for that particular corporation. the problem we have is most of

the common shareholders that were wiped out in this thing were from people holding it in their retirement plans. we are seeing a preference for the actual workers, the corporation, the uaw workers with excession demand for wages and lack of concessions prior to the bankruptcy who drove the company into that position. host: thank you. miss seetharaman? guest: this is indicative of the anger we hear about the bailout and the feeling the union was given preferential treatment. it is a contentious issue. a lot of people share it. the consensus among analysts and people who track this is the union alone did not bring these companies into bankruptcy. it was not the union alone. there are also issues of the quality of the vehicles they are selling.

no matter what kind of labor agreement you have, if you are not selling quality vehicles, you will not be successful. that seems to be a common thread among the analysts we speak to regularly. the issue that the union got favorable treatment is a common one. it angers a lot of people. i would reiterate what i said earlier. the union did take some steep concessions. at the end of the day, they are the workers that build the vehicle. i think the auto task force has the responsibility to make sure that there was respect for the fact the uaw workers build the vehicles and work in the factories. there are no easy choices and right answers. there is a lot of anger.

it is very common. the previous calls are emblematic of that. host: our guest is deepa seetharaman from reuters out of detroit to talk about the auto bailout and potential losses, a cost of about $25 billion. detroit, michigan, independent line. caller: good morning. i would like to thank obama for helping save the iowa -- the auto. more jobs were lost besides working for the big three. my husband was -- he did not work at the big three, but his job was saved because of that. other jobs were saved. they did have to make

concessions. he had to give up some health care benefits. his pay was lowered by $5 or $6. he lost vacation time. he started under the bush administration. he had no strings attached. he gave from between $7 and $25 billion to start the program. host: we're running short on time. what was the question? caller: mine was just a comment to say that i think obama -- thank obama. host: a question off of twitter. how much government influence does gm see? do they still consult with the government about how their business is doing? guest: gm says the obama

administration does not weigh in on business decisions. that is what we hear regularly. this week, gm put in a bid for allied financials' to national operation to expand their ability to finance the coast around the world needed to finance vehicles -- to expand their ability to finance vehicles around the world. it is a unique deal because ally was one of the companies risk nearly $17 billion in bailout money in 2009. the proceeds of the sale of the international operations will go to the taxpayer. gm is in the running, so it creates an ironic twist in terms of government influence.

host: pittsburgh, pennsylvania, andrew. caller: what is the history and right of the u.s. government being able to buy private industry and spending u.s. tax dollars to buy these industries and then losing billions of dollars in them. to mark the end up having us on the hook for this money long term -- they end up having us on the hook for this money long term. the companies and up losing money in the long run and end up having us owe money. the taxpayers lose the stimulus money over the long term. guest: i cannot say i am familiar with an historical precedent of bailouts. i think this particular package is unprecedented. i am happy to be corrected on the. i think in this case, the losses

were expected. the white house weighed this against the fact that 1 million plus jobs would be preserved. that is what they take as a success, the loss of those 1 million jobs in 2009 during the depths of the recession would have been extremely damaging to the u.s. economy. it would have hurt any progress that could have been made. i think the bankruptcies were seen as a necessary evil. i do not think the obama administration wanted to do this. i do not think anyone wanted to bail out detroit, but it had to happen for there to be economic stability at that juncture. since then, you have seen all three u.s. automakers improve. they have steady themselves financially. they're pulling profit. they've added 250,000 jobs since june. it is a question of jobs versus money.

the money is real. the loss is real. it is something to be concerned about. the white house and other pundits believe that when balanced against the jobs saved, it was worth it. host: what is the difference between what is going on at gm and chrysler? guest: the bailout packages were sharply different. gm got cash. chrysler was laden with debt, dollars and 7.6 billion in loans from the u.s. and canadian governments. that matters because chrysler was paying exorbitant interest rates on those loans. when they were coming out of bankruptcy, it undercut their ability to post profit. as a results, they did not have the balance sheet restructuring. chrysler had to make changes faster.

chrysler had to cut even deeper. every executive seemed to have three or four jobs. they worked seven days a week. that is not to say that gm executives do not work hard. but at chrysler, they had a gun to their head. gm with the cash did not necessarily have the incentive to change as rapidly. i do not doubt for a second that gm feels the pressure, especially now that the stock prices in the 20's, far short of the ipo price. host: christian is on the democrats' line from ohio. caller: i hear this $25 billion loss. this loss would only occur if the government or to cash in the stock early.

we are reinvesting in america in one of the worst financial crises we have had in the long time. this would be a good time to get the money back. when you consider the millions of jobs lost, millions of employees that a state and local tax to support schools and property taxes. people would have lost homes. you are talking huge losses. $25 billion is nothing compared to that. if they had to take $135 billion pension in the government, that would have been worse than $25 million. we are reinvesting in america. that $25 billion is nothing compared to the billions that would have been lost. guest: i think that is an important point. the caller makes an extremely important point.

the u.s. government has not cashed in the 500 million gm shares. the ipo of ally financial is not imminent. they're still working on cashing out of ally. at the moment, it is the radical. the value of the losses seem to contract and expand the pending on investor enthusiasm for gm shares -- depending on investor enthusiasm for gm shares. we are investing in the economy. investing in an industry is important as well. the automotive industry put up an estimate of how much the lack of a bailout would have cost the u.s. they came to a figure of around $27 billion. that is two years ago. i am not sure if the updated the

figure. that is $27 billion and over 1 million jobs lost. that is what we're weighing this again. a $25 billion theoretical loss against a real loss of $27 billion and a loss of over 1 million jobs. host: is there a definite amount of time we can hold on to the shares? do we have to let go of them at a certain point? guest: there does not seem to be a timeline. the obama administration initially wanted to be out by now. they wanted to be out by the next presidential election. that clearly is not going to happen. treasury is saying we will sell shares to maximize shareholder returns and as soon as practical. that time has not come yet. host: here is hampton, conn., joanne, independent line.

caller: he gave this money to unions in the auto industry. it will be laundered and given back to him as the nation's. that is who he helped. we are supporting this industry. the only reason they are successful is because of our money. he is going around saying gm is number one. it was number one for six months because of the tsunami when the japanese had to shut down the toyota plant. now that the plants are open, toyota is number one. he is misleading and wind to the american people replying to the american people saying he saved the auto industry. the key is misleading and lying to the american people saying he saved the auto industry. guest: i think detroit would agree the only reason gm and chrysler are still around is because of the american taxpayer. that is unequivocally true. everyone at gm and chrysler is ry