Monday, June 01, 2009

GM Bankruptcy: What Can Be Salvaged?

GM's failure is a sad day for many. The pain is felt by many...

-- The management team that saw a once great business turn from a car supplier to a health insurance firm is now a failed entity (and team).
-- The tens of thousands of employees who temporarily lose their livelihoods need to start over.
-- The communities that lost a major employer and the flow of cash for homes, services, food, goods, etc. may never recover.

Bankruptcy has its merits but much less with the involvement of the federal government. As citizens, it is a company few would invest in, yet our elected officials have decided it is worthy of the investment. Plants will close. Dealers no longer supported or supplied. Product lines will shrink. Used car market and parts for obsolete brands very limited.

The Bush administration started this bailout with billions. Obama continued it in his first 100 days and now is completing the takeover with billions more. To say GM is a cash devourer is an understatement. The UAW will still see a decent pension (although it fund has all but dried up) and health care deal out of this; the investors get the shaft. How come Congress has had no part in this money pit?

As the new overseers of a car company, will the feds decide to force Americans to buy GM cars with government-subsidized discounts? Will those cars be green cars with lawnmower engines. In other words, will it build cars people want to buy or will it build cars people are forced to drive? How many GM cars will people not buy out of spite?

The Obama administration claims no desire to be a long term GM owner and overseer, but what will force it to get out? Will the government get so ingrained in GM that it will become at part of the Department of Transportation -- Manufacturing Division?

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