Massachusetts

Apparently I’m not the only one thinking that there could be substantial benefits to GM and to the taxpayers for GM to proceed through the Chapter 11 process, as long as the government steps in to be sure that Chapter 11 (reorganization) doesn’t turn into Chapter 7 (liquidation).  From today’s NY Times:

G.M is using money so quickly that a $10 billion infusion made today would disappear by February. That is why taxpayers shouldn’t fork over a cent, at least until shareholders are wiped out, management is tossed out and the industry is completely reorganized.

But there is a fix. Call it a government-sponsored bankruptcy, a G.S.B., if you will. It might sound a bit like an oxymoron, but it is an idea that has been quietly making the rounds in Washington. It makes a lot of sense.

Here’s how it could work:

This entry was posted on Thursday, November 20th, 2008 at 11:29 am and is filed under News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.