Get a Grip, People.
What would it mean to have GM go bankrupt? A change in ownership and a renegotiation of contracts.
The factories, computers, office space, intellectual property and so forth that are now owned by GM would not disappear; they would basically become the property of GM’s creditors. These creditors would sell the assets to the highest bidder. Assuming there is economic value to be created by continuing to operate the company as a business, private equity or strategic investors would buy the assets, shut down some plants, fire some union and exempt workers, and probably use the leverage of bankruptcy court to get a better deal from the unions.
One thing we tend to forget in this whole bailout-palooza is that companies that go bankrupt simply do not disappear. Their assets and property and employees simply don’t dissolve if they file bankruptcy. Companies reorganize, assets change hands, and some (but by no means all) employees are laid off.
If GM went belly-up tomorrow, it wouldn’t presage the end of the world. Someone – likely several someones – would buy all or parts of the company and a brand new GM operating under some other name, would keep on making cars more cheaply (because of fewer costs imposed by old and foolish union contracts) and the planet would keep right on turning. Our economy wouldn’t crash and we wouldn’t all be relegated to eating dog food out of a can.
We really do need to get a grip.
Other Posts of Interest:
Category: The Long War Here At Home, The Rise of the Nanny State
The problem with so many people is they think the government should protect or save "jobs" at any cost. They willingly elected the man who promises to plunder these same companies & give the money to the poor. Yet, he's not even in office & he's trying to convince them why he needs to take money from the poor & give it to these companies. How do they reconcile that I wonder?