The CEO of GM (Government Motors) was fired by the president of the United States. For those old fuddy duddies out there who may think this a danger to free market capitalism, American liberty, and common sense (not to mention those of us who love nice looking automobiles), I say relax and get with the program.
As this report clearly shows, if the government is in for a penny, it is in for a billion - or several billion as this case may be:
The administration's auto team announced the departure of Mr. Wagoner on Sunday. In a summary of its findings, the task force added that it doesn't believe Chrysler is viable as a stand-alone company, and suggested that the best chance for success for both GM and Chrysler "may well require utilizing the bankruptcy code in a quick and surgical way."
The move also indicates that the Treasury Department intends to wade more deeply than most observers expected into the affairs of the country's largest and oldest car company.
After spending billions of dollars to prop up these dying giants, now the government gets ambitious and may seek to assist them through the bankruptcy process. And apparently, the government is going to shower more money on GM and Chrysler to "tide them over:"
The administration said it would provide the company sufficient working capital for 60 more days, during which a revamped GM board and top management has to put forward a much more rigorous restructuring plan than it submitted last month.
"The administration is prepared to stand by GM throughout this process to ensure that GM emerges with a fresh start and a promising future," according to term sheets released by the White House Monday morning.
Administration officials made it clear that an expedited and heavily supervised bankruptcy reorganization was still very much a possibility for both companies. One official, speaking of GM, compared such a proceeding to a "quick rinse" that could rid the company of much of its debt and contractual obligations.
Any bankruptcy proceeding would stick it to debt and bond holders of GM but no word on making the unions pay a price for their part in this debacle. Since the forecast for hell calls for steady temperatures above the boiling point of water, it is not likely a quick freeze will come to the nether regions anytime soon thus making it an impossibility for hell to freeze over before unions get the same treatment as GM bond holders.
Meanwhile, we better get used to Obama being the final arbiter in hiring and firing of CEO's. And this gives me an idea. Since the government needs revenue - a lot of revenue - maybe Obama could set up an employment agency for CEO's at the White House. Sort of like a Monster.com for executives he throws under the bus.
The franchise rights alone could retire the national debt.
Share