WASHINGTON (AP) — President Barack Obama on Thursday celebrated the return of a reborn General Motors to the U.S. stock market, saying it shows some of the "tough decisions that we made" during the financial crisis were beginning to pay off.
"American taxpayers are now positioned to recover more than my administration invested in GM, and that's a good thing," Obama said, speaking of his administration's $50 million taxpayer-backed rescue of the venerable automaker.
Trading the new stock is a milestone for both the corporation and for the Obama administration.
The stock rose sharply at first, rising to nearly $36 per share from the $33 price GM set for the initial public offering before pulling back and closing at $34.19.
The trading — more than 400 million GM shares traded hands during its debut on the Big Board — helped reduce the federal government's stake in the company from 61 percent to about 36 percent.
For the U.S. to break even on its investment, it must sell its remaining stake for about $50 a share.
Obama said estimates indicate that actions by his administration helped save more than 1 million jobs across 50 states.
The Center for Automotive Research estimated that aid to GM and Chrysler saved more than 1.1 million jobs in 2009 and 314,000 jobs this year. The third Big Three automaker, Ford Motor Co., did not accept federal assistance and stayed out of bankruptcy.
With it's first day of trading, the once near-death automaker "took another big step toward becoming a success story," Obama said.
Obama said the revitalized GM proved that "doubters and naysayers" were wrong.
"We are finally beginning to see some of these tough decisions that we made in the midst of the crisis pay off," the president said.
House Republican leader John Boehner of Ohio, in line to become the House speaker in January, avoided a direct answer when he was asked whether the government's treatment of General Motors had saved any jobs.
He said he had favored allowing GM to go through bankruptcy, and said the episode "could have been handled without the heavy hand of the federal government in the midst of it." He said tens of thousands of people were punished as a result of the process that was used.
Rep. Dale E. Kildee, D-Mich., co-chairman of the Congressional Automotive Caucus, said the company's strong IPO performance shows that government loans were "a smart investment of taxpayer money" that saved jobs and that GM was well on its way back to productivity and profitability.
Those who held old GM stock were essentially wiped out when the company filed for bankruptcy.
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