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  • Obama to "allow" GM Bankruptcy

    Well, This is interesting news ( http://www.reuters.com/article/topNe...53003A20090401 )...and I think a strong, positve move by the President. I am just interested in seeing how the Unions are treated in this "structured" Bankruptcy.
    But all in all... something that should have happened 4 months ago..before Bailout attempt #1.. (where did that money go???)
    |TG|ARMA Pathfinder
    ..now where did I put my keys?

  • #2
    Re: Obama to "allow" GM Bankruptcy

    Yeah.... this is what they should've done before we gave them BILLIONS! It happened anyways, so they just wasted our money!

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    • #3
      Re: Obama to "allow" GM Bankruptcy

      Originally posted by peardog View Post
      But all in all... something that should have happened 4 months ago..before Bailout attempt #1.. (where did that money go???)
      Where did the money go? It went to sustaining these behemoth companies, including their union contracts and grossly underfunded pension funds. Once again we are presented with a problem that has been years if not decades in the making and no one honestly dealt with it until it became an emergency. Wagoner shouldn't be the only one dismissed.

      Think about it, Obama wasn't President four months ago, but even if he was I think he would have done something similar. The end of 2008 was no time to make plans like this. Now that Obama's administration has some support columns in place, they are ready to try and actually deal with the problem of an unsustainable giant in the U.S. auto industry. As with many of the administrations plans (and there are many), we are left to postulate as to their success or failure. Only time will tell.

      Why the whining about money though? The money would have been lost one way or another - of the billions of treasury dollars spent on the auto industry thus far, how many billions would have been lost in terms of tax revenue, investments and 'contagion' costs if these companies were simply allowed to go broke overnight? It's a fools suggestion to think that the government shouldn't be intervening in these kinds of failures. They must. The only debate is over how.

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      • #4
        Re: Obama to "allow" GM Bankruptcy

        Originally posted by AMosely View Post
        It's a fools suggestion to think that the government shouldn't be intervening in these kinds of failures. They must. The only debate is over how.
        Oh they will intervene.. It's call structured Bankruptcy.. and it should have been done earlier..
        |TG|ARMA Pathfinder
        ..now where did I put my keys?

        Comment


        • #5
          Re: Obama to "allow" GM Bankruptcy

          Originally posted by peardog View Post
          Oh they will intervene.. It's call structured Bankruptcy.. and it should have been done earlier..
          Agreed, but earlier when? People knew there were foundational issues with these companies years ago. They knew that if a serious recession hit, the weakened foundation wouldn't support it. But we know that both corporations and the government don't often work this way - proactive is not a word in their vocabulary. Proactive to them is collapse mitigation.

          So the problem(s) are ignored until a recession hits. When the recession did hit, the country had a President who didn't subscribe to such anti-free market ideology and was forced into freeing up billions to the financial industry - so he passed the buck if he did anything at all. I think it's reasonable that it took Obama's administration this long (~ 2 months) to publicly address it given the magnitude of other problems they had to address in the mean time.

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          • #6
            Re: Obama to "allow" GM Bankruptcy

            Heh.. I was doing some research to have a timely response to your question when I came upon this Web site.. http://www.gmbailout.com/ ..It's a New/blog format... but what is "shocking" is the number of time you can see the UAW walk out of talks with GM during negotiations AFTER the first Bailout/handout last year.
            |TG|ARMA Pathfinder
            ..now where did I put my keys?

            Comment


            • #7
              Re: Obama to "allow" GM Bankruptcy

              If you could trigger small earthquakes to avoid The Big One, would you do it? Even though it would cause property damage and possibly deaths?
              Dude, seriously, WHAT handkerchief?

              snooggums' density principal: "The more dense a population, the more dense a population."

              Iliana: "You're a great friend but if we're ever chased by zombies I'm tripping you."

              Comment


              • #8
                Re: Obama to "allow" GM Bankruptcy

                Here's my issue: Why should AIG get two bailouts that they promptly wiped their bottoms with while General Motors suffers? They account for every penny, made concessions, even fired their second-in-command and yet they've been put on hold on the bail-out cart. It's disgraceful. As far as I can tell, AIG didn't do anything to earn their money while GM works it's butt off and receives nothing.




                "Certainly, being bombarded with 105 millimeter shells is bad. But the knowledge that you've armed your enemy thus, with your sloth and your ineptitude, unfolds in the heart like a poison." Tycho from Penny Arcade in reference to the nuke in MW2

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                • #9
                  Re: Obama to "allow" GM Bankruptcy

                  Originally posted by Mech__Warrior View Post
                  Here's my issue: Why should AIG get two bailouts that they promptly wiped their bottoms with while General Motors suffers? They account for every penny, made concessions, even fired their second-in-command and yet they've been put on hold on the bail-out cart. It's disgraceful. As far as I can tell, AIG didn't do anything to earn their money while GM works it's butt off and receives nothing.
                  All of this isn't about fairness. GM just doesn't present as much systemic risk as AIG.

                  GM can go into bankruptcy and you can sell off the good bits to others that will manage them better. You can figure out what GM is worth and what GM has that is valuable.

                  With AIG the bad bits are the unknown parts. Nobody seems to know what they worth what and how many people have interests in those unknowns. But they do know that there are many and that exposing those bad bits to light of day may cause explosions of a sort. Keeping them in the dark and pouring money over them keeps them somewhat more stable.

                  Of course their is always a chance that exposing them would not do that much harm. That they just go 'pop' and most survive and get back to business quickly. Few want to take that chance.
                  Iím not racists, I have republican friends. Radio show host.
                  - "The essence of tyranny is the denial of complexity". -Jacob Burkhardt
                  - "A foolish consistency is the hobgoblin of little minds" - Emerson
                  - "People should not be afraid of it's government, government should be afraid of it's People." - Line from V for Vendetta
                  - If software were as unreliable as economic theory, there wouldn't be a plane made of anything other than paper that could get off the ground. Jim Fawcette
                  - "Let me now state what seems to me the decisive objection to any conservatism which deserves to be called such. It is that by its very nature it cannot offer an alternative to the direction in which we are moving." -Friedrich Hayek
                  - "Don't waist your time on me your already the voice inside my head." Blink 182 to my wife

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                  • #10
                    Re: Obama to "allow" GM Bankruptcy

                    Originally posted by El_Gringo_Grande View Post
                    All of this isn't about fairness. GM just doesn't present as much systemic risk as AIG
                    Exactly - and it's not even so much systemic risk as gravity of wealth and the contagion effect.

                    It's worth pointing out that this should serve as further proof that we are not a pure socialist society - aspects of American government are socialist in nature, and are by design and default, but if everything were going down the socialist toilet as Fox news and others claim, GM would be bailed out and their employees protected.

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                    • #11
                      Re: Obama to "allow" GM Bankruptcy

                      Who did GM and AIG contribute to in the election? Could that have a bearing on who's getting Uncle Sugar's special attention? (But large corporations have learned to contribute to both sides, to get an inside connection no matter who wins.)
                      Dude, seriously, WHAT handkerchief?

                      snooggums' density principal: "The more dense a population, the more dense a population."

                      Iliana: "You're a great friend but if we're ever chased by zombies I'm tripping you."

                      Comment

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