Reply #5: If they go bankrupt by the end of this month [View All]

[BzaDem]

the union contract will have to be renegotiated by the bankruptcy court. Basically, the union and management will try to negotiate a contract, and if they can't agree, it will go to arbitration. The point is, if they go bankrupt, the union will have much less control over the concessions it will be forced to make. (Not to mention the number of employees who will be laid off in a bankruptcy).

Therefore, it is in the interests of all workers for GM not to go bankrupt. That is why they are making the said concessions.

As for the bailout, the goal of the bailout is to help workers, but to do it in a way that preserves the solvency of GM. If GM gives workers more benefits, that might help the economy in general, but it will significantly hurt the ability of GM to remain solvent, and GM will undoubtedly need more money within months. This means one of two things must happen:

1. GM goes bankrupt after the first bailout fails to keep them solvent, bringing back all of the problems for the auto workers I mention above
2. The US keeps giving more money to GM, despite the fact that it will never become a viable business

If 2 happens, then basically we are having the US run a job bank just for the autoworkers and no one else that is in dire need. If we are going to provide more aid to those in need, more healthcare benefits, etc, it should be to everyone in the form of a stimulus package and/or healthcare bill.

This is why the purpose of the bill is to keep GM solvent, so it can continue to employ its workers on its own.