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Cramer: GM's IPO Should Not Leave Out Taxpayers

Before General Motors files for its initial public offering, the US government should consider how the American taxpayer will benefit, Cramer said Tuesday. Afterall, it was taxpayer money that made the bailout possible.

With the Troubled Asset Relief Program, Cramer said the taxpayers knew the funds would help bail out the banks, but became upset when they didn't benefit as a result. Instead, he noted that the bank executives received financial rewards when things started to improve.

"We bailed out Morgan Stanley ; they paid themselves a lot. We bailed out Goldman; they paid themselves a lot," Cramer said. "You've got to eliminate that because I've got to tell you, the GM people, they're going to be paying themselves a lot."

With GM's IPO, the Mad Money host fears that the company board and unions will benefit while the taxpayers are forgotten. He said all taxpayers interested in participating in the IPO should be given the chance. But he doesn't think that will happen, especially since CNBC's Erin Burnett reports that 80% of all IPOs go to institutional investors.

Unlike with TARP, Cramer said the government now has time to figure out how to repay the taxpayer. He hopes US Treasury Secretary Timothy Geithner will act before GM files for its stock offering, which Reuters reports could happen in the third week of August.

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