And I'm not talking about a few thousand autoworkers in the midwest. What do we, as American taxpayers, get out of our $65 billion dollars? As near as I can figure that gives us each about a $250 stake in that company. Is this another giveaway or does the government get some voting stock? And if so, what are they gonna do with it? Because if they're just gonna keep paying GMs executive class to keep fuckin up I want my $250 back.

washingtonpost.com/wp-dyn/content/article/2009/05/27/AR2009052701275.html?wprss=rss_business

(linked at sig)

Apparently, bondholders think they'll get MORE from a liquidation than a re-org.

Personally, I don't care about GM. If it's bankrupt, so be it. Liquidate it.

HOWEVER--the government should get OUR $19 billion back before anyone else. That's money that many of us would *never* have invested in a dinosaur like GM. Bondholders can bitch and moan, but they did buy the bonds from an American car company, and it's not like people haven't known the US car industry has been dying of attrition since the first oil shock.

In the interest of irony, I would like to see the government use its ownership of GM to convert it from a car manufacturing company to a trolley manufacturing company. We could even use some stimulus/climate money to guarantee some customers. This seems only fair since it was GM who bought up and killed most of our public transit streetcars in the '50s.

On a distantly related note, I used to pass a fenced in trolley car as I bicycled past the Hayward, CA BART station (three decades ago). I always hoped I would live long enough to see the trolleys back in operation and a car relic placed in such a display. I'm feeling a little more optimistic now.

But the situation is rather complicated. The bondholders who are secured--i.e. have been given a claim on assets in exchange for their loaning money--actually would likely end up with a greater recovery in liquidation.

In addition the argument of "they should have known better than to lend to a dying industry" supports them getting their money. Would it be better for society if nobody loaned to industries in decline? That's why they get claims on assets--if they were completely unsecured the borrowers would likely not be able to afford to borrow at all.

That's not to say that a lot of hedge funds didn't buy in to the debt when it was already distressed--vulture investing isn't necessarily pretty or morally clear. I frankly think they are engaging in histrionics, but there is a point here--that these bankruptcies are proceeding in an irregular way from what would happen. So maybe the rules need changing, but the danger is that making things arbitrary that the system won't work as well in the future. One can argue that bankruptcy is too lenient in the US--especially for old established companies, but we do seem to have more entrepreneurs out there that fail a few times before success.

But if GM hadn't closed all of those trolly companies in the 50s where would low budget restaurants have opened in the 60s? One of the best steakhouses in Portland used to be in a series of interconnected trolly cars.

Clearly the guy from Indiana must be a neocon thug. Only an evil bastard would try to use the bankruptcy laws to protect the retirement funds of Indiana state employees. Who even cares about Indiana and their employee retirement packages anyway?

I feel for the state employees (I have relatives in the same boat), but there's a lot more at stake here. It's called being part of a community. But republicans don't seem to understand that.

We need to not only let these comnpanies die but let all our companies die. Face it, capitalism is broken. We have too many people and not enough jobs, because we don't need any more crap. We should all be working 10 hour weeks now thanks to technology.

"The bondholders who are secured--i.e. have been given a claim on assets in exchange for their loaning money--actually would likely end up with a greater recovery in liquidation."

So they should be psyched. Sounds like it's all good.

But as I mentioned, get the PUBLIC FUNDS back first. I don't care if US marshals have to confiscate a manufacturing plant and sell it piece by piece, but there is NO FREEKIN WAY our government should be taking money from *all* of us to pay off GM's bondholders.

I'm all for them getting whatever's left. Cannibalize GM and give it to the creditors, then the shareholders, etc. Sounds great.

Just take the taxpayers off the hook.

In addition the argument of "they should have known better than to lend to a dying industry" supports them getting their money. Would it be better for society if nobody loaned to industries in decline?

If the industry is in decline, hell yes it would be better if nobody loaned to them. GM has had 30 years to adjust to greater competition and higher gas prices, and what did they do when revenues were falling? They launched a FINANCE BUSINESS.

Clearly "the company" doesn't *care* about making cars. Shareholders just wanted to make MONEY.

And they blew it. Now give us our money back, then give the other creditors their money back (or whatever's left of it), then shut the doors and turn off the lights.

It's painful and it's ugly and it's going to hurt a lot of people.

But it's not complex.

I think it's pretty obvious that the bondholders would get less from a liquidation, I think they are using that as a negotiating tool and the government should call their bluff. After all how many people are looking to buy a car manufacturing facility or a big office building right now?

And those of you that want to see GM go bankrupt and go away, I see your point, but again there's a lot more at stake here than just a bankruptcy. The entire industrial might of a nation is at stake, and we need to preserve it if we are to continue to enjoy some of the highest standards of living on earth.