[FoRK] Let GM and Chrysler die
joe-fork at barrera.org
Fri Nov 14 13:11:04 PST 2008
I have to say I'm with the Republicans on this one. Both of these
companies should have died 30 years ago. GM especially.
Brooks makes a fairly convincing case for bankruptcy:
"This is an excruciatingly hard call. A case could be made for keeping
the Big Three afloat as a jobs program until the economy gets better
and then letting them go bankrupt. But the most persuasive experts
argue that bankruptcy is the least horrible option. Airline, steel and
retail companies have gone through bankruptcy proceedings and
adjusted. It would be a less politically tainted process. Government
could use that $50 billion — and more — to help the workers who are
going to be displaced no matter what."
I haven't found any really strong arguments against bankruptcy... for
example, I didn't find Daniel Gross's arguments very convincing:
"But is a Chapter 11 filing the best way to reach these goals?
Answering yes presumes that the case would be resolved quickly, that
the entities would be able to obtain ample debtor-in-possession
financing, that parties with legitimate legal claims on the company's
assets and cash flows would give them up willingly. But many of the
questions surrounding the Big Three's future can't be resolved in law
firm conference rooms or in the chambers of bankruptcy court, and
won't center around legal questions. The failure of the American
automotive industry – and let's be honest, it has basically failed –
is a matter of public policy. If the Big Three can be saved, they can
only be saved by government."
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