Let GM go bankrupt. Ford too, if necessary. I am shareholders in both companies, but I've already taken my losses at this point - the stock is essentially worthless. Take the rest. It would be better for the country in the long haul.
If the car companies cannot find debtor financing, THEN, the government should step in and help out duing the post-bankruptcy transition period.
Bankruptcy would:
1. eliminate "golden parachutes" and fat-cat pensions for executives, past and present.
2. Cut UAW wages from their ridiculous levels (4 or 5 times market value) to a more reasonable level.
3. Cut gold-plated retirements and health care for existing and former workers.
4. Allow GM to eliminate unnecessary brands (Pontiac, Buick) without facing Billions in dealer lawsuits.
5. Allow GM to cancel dealer agreements and eliminate unprofitable dealers, without facing Billions in dealer lawsuits.
6. Allow GM to import vehicles from its overseas subsidaries (Australia, Japan, Korea, Europe) without silly caps imposed by the UAW.
7. Allow GM to CLOSE unprofitable assembly plants without having to worry about UAW requirements that they maintain X number of workers.
8. With these savings, invest in product development for new domestically built cars.
Bankruptcy would restructure the company as a PROFITABLE enterprise. A leaner, meaner GM could compete on a world level with any automaker. GM's unburdened overseas divisions are already doing this.
If we BAIL OUT GM without bankruptcy, then nothing changes, and the company is still bloated and unprofitable and all we've done is band-aid the company and patch it up for another few miles down the road, where it will break down yet again.
A pre-bankruptcy bailout would just prop-up the old structure for another 12 months or so. You'd be back to the bailout table in 2010.
While it is tempting to play Superman and "Save the Day" sometimes people (and companies) need to work through their problems.
I've heard some analysts compare GM to an alcoholic - and I think the analogy is apt. Giving money to GM is like giving booze to an alcoholic. It might make them happy for a while, but it does not solve the underlying problem.
Let GM go through its 12-step program and then, only then, help them up from the gutter.
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