Huh??? GM to go bankrupt and then we bail them out??? How does that help drive down union costs, pension costs, supplier costs?
Stop it! This is silly!
“Huh??? GM to go bankrupt and then we bail them out??? How does that help drive down union costs, pension costs, supplier costs?”
This could prove the best way to go.
A bailout withOUT bankruptcy would be business as usual for the companies AND the unions, continuing right down the road to ruin.
Bankruptcy by itself might result in credit problems for the automakers, because even after restructuring, they might not be able to raise sufficient cash (through wary financial institutions) with which to continue in business.
However, if, after bankruptcy, the government would be willing to indemnify lenders to the automakers, they could then restructure (with renogiated union contracts) AND be able to find the necessary cash from banks who wouldn’t fear of losing their loan money....
I detest Dodd (from my own state), but perhaps he’s actually right on this....
- John