Obama Boosts GM With Fleet Sales; Localities Buy Police Cars With Federal Money

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Government MotorsGeneral Motors announced an increase in government purchases of 115% in July. This follows June's jump in government fleet sales of 79%. Just what's going on? GM has claimed that it is localities (mostly for police vehicles) and not federal purchases driving the increases, but aren't localities struggling with their budgets? Why do the nation's police forces all of a sudden need new vehicles? A little research uncovers that the Obama Administration is once again being generous with federal grants to localities to purchase new cars, with one of the primary end recipients of taxpayer money being GM.

It seems dubiously orchestrated that GM would make sure that they attributed the unusual increase in government fleet sales to localities rather than federal purchases. It's almost like money laundering where taxpayer money gets filtered though grants to localities and then gets back to GM via purchases of police vehicles and such (this is also a trick that has been used to promote the Chevy Volt). Any large increase in federal purchases of GM vehicles would be criticized, but giving taxpayer money to local police forces to buy the cars is defensible.

Of course, the grants for law enforcement will be defended as a noble spending of taxpayer money to fight crime. But why did localities all of a sudden need to buy about double the amount of vehicles that they did last year? Hold on to your hats as you hear how Jersey City bought $12 million worth of new vehicles with federal grant money and then said the vehicles would not be used on a regular basis.

NJ.com reports that "Jersey City officials hosted a show-and-tell Wednesday of roughly $12 million in new fire trucks, police vehicles and other emergency-management equipment it has procured over the past three years by using federal grant money." Commenting on the vehicles not being used on a regular basis, Fire Director Armando Roman said, "It's better to have it and not need it than to need it and not have it." Sure, especially when the federal government is providing the taxpayer money to pay for it.

Like cockroaches, where there is one federal grant, there is sure to be many more. Nine NJ towns received over $9.4 million from a federal program that pays for hiring law enforcement but seems to also allow for the purchase of new police vehicles according to GallowayPatch.com. Click here for another; and another; and another; and another. I would not doubt that there are stipulations for the grant money as to what type of vehicles are purchased. How many new Toyota Camry (made in America) police cars are out there?

So, by hook or by crook, GM will be selling vehicles and proclaiming how successful they are as Obama continues to campaign on that same "success." With $50 billion of taxpayer money handed to them and such "success", you have to wonder why GM's share price has gone from a $33 IPO price down to the current $20 range. More importantly, you have to wonder how America can continue to afford to throw money away to help give the perception that GM is an Obama success story.

Mark Modica is an NLPC Associate Fellow.