Re:Ask YC: To save GM or not?
by aidenn0 on Thursday November 13, 2008 @12:38PM
(#363284)
If GM goes bankrupt, there will be massive unemployment and closed factories. This sucks. On the other hand, this is a good environment in which to be a manufacturing company with cash on hand. If GM can't turn a profit, they need to make room for someone who can.
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When a company goes bankrupt nobody needs to be fired the next day. A judge can restructure the company and toss out specific contracts such as executive bonuses, union pay, and debts. Look at Delta Air lines as an example of this http://en.wikipedia.org/wiki/Delta_Air_Lines.
Yeah, except GM is so shaky, and credit markets so tight, there is serious concern that they could enter a 'restructuring' bankruptcy, but end up in a liquidation, because they won't be able to secure bridge and exit financing needed operate while in bankruptcy and to actually restructure their debt.
If they fixed union contracts to become reasonable and limited executive pay then I don't mind government financing as part of that solution, but giving them money when they are as broken as they are now is stupid.
Re:Ask YC: To save GM or not?
by redrobot5050 on Thursday November 13, 2008 @04:04PM
(#363591)
All the more of an argument to let them fail.
If the "free market" does not think it is a good investment/risk ratio, why let the taxpayers take it?