U.S. Plan Sees Easing of G.M. to Bankruptcy

[tomm2thumbs]

Source: NY Times

The government may seek to ease General Motors into what it calls a “controlled” bankruptcy, somewhere between a prepackaged bankruptcy and court chaos, by persuading at least some creditors to agree to a plan that would cleave the company into two pieces, according to people briefed on the matter.

Instead of signing on every creditor as is typically required in prepackaged deals, administration officials are using as leverage the promise of taxpayer financing. Many regard the government as the only lender willing to step up with money — in bankruptcy or out.

“They’re going to have tremendous power,” said Lynn M. LoPucki, a law professor at the University of California, Los Angeles. “They can call off the money and the whole thing fails.”

G.M.’s new chief, Fritz Henderson, also said that the pressure from the government pushed the automaker closer to bankruptcy.

“By no later than June 1, if we’re not able to accomplish this outside bankruptcy, we’ll be in bankruptcy,” he said at a news conference in Detroit on Tuesday.

Read more: http://www.nytimes.com/2009/04/01/business/01bankruptcy.html?_r=1&hp

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Sounds like they are trying to land GM in the water as carefully as possible after a major bird strike

[amandabeech]

1. Say good bye to the pensioners.

I might feel a little better if I knew that Obama had some auto manufacturing (maybe just manufacturing) and union people in his automative group.

I looked at the team. I couldn't find anyone.

[saigon68]

6. Billions for AIG criminals and the UAW can get fucked

Yes Geitner, takes care of his own CLASS OF PEOPLE

Nice butt fucking of the Union Jobs and Pensions

Mean while our unemployed children are going to Vietistan to fight guys with religious fervor

[amandabeech]

7. I just don't know what to say anymore. n/t

[tomm2thumbs]

2. maybe he can convince a few heads from ToyotaUSA etc to sneak away for the country's sake

personality can make a huge difference - Steve Jobs case in point
Strange thing is, I can remember when Ford bought Jaguar for 2.4 billion - and it was considered over-paying...

[DainBramaged]

3. The UAW should walk out of all GM and related parts manufacturers

TOMORROW and put the economy into a free-fall. Then this administration will see what it's like to support the suits and not the workers.

[Somawas]

4. Yes. Exactly.

I'd support a UAW strike.

[Hannah Bell]

5. they should have done it long ago. but they were too busy making nice with the bosses.

[blue_onyx]

8. Clearly they're easing GM into bankruptcy

Obama saying the government will back warranties and GM's customer confidence plan, which will pay up to $500 per month if you lose your job, are attempts to make consumers feel secure about buying from a bankrupt company. The fact that the CEO is saying bankruptcy is possible, something that they use to avoid even mentioning, shows what's on the way. Here comes 20% unemployment for Michigan.