GM is pulling out all the stops to secure a government bailout which preserves the status quo. Others say any government funds should come only as part of a pre-packaged backruptcy. I couldn’t agree more, Here is one view that make a lot of sense:
New York University business professor Edward Altman, a long-time analyst of corporate bankruptcies, says the federal government should only put money into GM through a pre-planned bankruptcy process that knocks out GM shareholders, rolls bondholders into equity and renegotiates union labor contracts.
For what its worth, even Gordon Brown opposes a Detroit bailout on protectionist grounds. The UK can also speak with deep experience on the folly of nationalizing the auto industry.
