Chapter 11

Posted on 11/15/2008 at 9:27 am by Bob Cesca

There’s a push to simply allow the automakers to file for Chapter 11 bankruptcy protection. On the surface, that seems to make sense, but the problem here is that we still lose those jobs, and I’m not convinced that losing three million jobs in an already toxic middle class economy is very smart.

The best plan is clearly to give them the bailout they want, but with serious strings attached. Don’t even call it a bailout: call it a financial incentive or investment capital for green cars and fuel efficiency. Something like that. Weren’t we going to do something like that anyway?

Here’s a fun fact about Chapter 11… The way the law works, it costs the same amount for Ford or GM to file Chapter 11 as it does for a small business of three employees to file. Fairness!

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  • XRugly

    Straightening out the laws, de-regulating the industry from bad safety laws wouldn’t hurt.lets make an urban class, cars that do 40 mph and are not allowed on the highways, electric ultra light cars.If we do give them any money we have to execute at least 12 members of management and 12 members of union management from each company. It will be great for moral and get some of the wool out of these organizations.

  • Nanotyrannus

    No matter what we do – allow them to file Chapter 11, give them $300 billion dollars (yes, the “bailout ” will be far more than anyone is talking about right now- GM will take the offer, then a few weeks down the road when the kurfuffle has died down and we’re talking about giving $100 billion ($300 billion) to the airline industry, they’ll announce that, sorry, things are still pretty shitty here in Detroit and we just have to let go a few hundred thousand employees. But honestly, we feel really really bad about it.No strings will be attached to the bailout. Bush wont support “strings’” – hell, he’ll even be brazen enough to threaten a veto if there are any – and Congress will roll the fuck over just like they have consistently done the past two years.I’m sorry to be so pessimistic, but our current congress has no spine and wont until one is rammed up their collective asses on January 20th.

  • Alan4s

    Along with each and every bailout package given to any company, we should send a team of government auditors. If you accept bailout money, then you accept oversight.These auditors should be given override authority on any decision, and be specifically directed to watch for shenanigans like the AIG “deferred compensation” payment, various bonuses, and other hidden perks like travel to conferences or retreats.It astounds me that we are just blindly dumping money into these companies without any control over how that money is used.

  • TimEldred

    Couldn’t agree more with the comments above. I think the complexity of economic issues is clouding one very simple point: a cry for a bailout (MAN that word is poison!) indicates a failure of leadership. So condition number 1 should be that if your company accepts the bailout the leadership gets replaced.And if it’s a really big bailout, government gets to tell the company how to spend it. You know, benchmarks. Just like we needed in Iraq all this time.I bet if we were calling it ‘government investment’ or ‘subsidy’ or ‘buy-in’ we’d be less prone to think of it as a form of welfare that leaves our control the moment it leaves our hands.

  • Redflags

    “The law, in its majestic equality, forbids rich and poor alike to sleep under bridges, to beg in the streets, and to steal their bread.”http://en.wikipedia.org/wiki/Anatole_France