Bankruptcy. Something many of us advised before the government threw 20+ billion of our dollars down the proverbial rat hole:
A week into his new job as chief executive of General Motors, Fritz Henderson said on Sunday he was confident in the future of the company but a structured bankruptcy remains a possibility.
Mr. Henderson has just 55 days remaining to meet President Obama’s timetable to come up with a new plan to save the struggling car giant. Speaking on NBC’s “Meet the Press,” he said that the company was working to avoid bankruptcy, but that if it failed to meet its goals for cutting costs and shrinking the company, it “may very well be the best alternative.”
“If it can’t be done outside of a bankruptcy process, it will be done within it,” he said.
Ah, how nice. And what, we had to fire the CEO, put a new board together and essenitally give control to the government to come to this conclusion?
Even Timothy Geithner, the tax-cheat of a Treasury Secretary, is now saying the “B” word is a possibility:
Treasury Secretary Timothy F. Geithner stressed Sunday that G.M. “is going to be a part of this country’s future,” but said that a managed bankruptcy was among the options for the company.
“These guys have made some progress in putting together a restructuring plan, but they’re not there yet,” Mr. Geithner said on CBS’s “Face the Nation.” “We wanted to give them the time to try to get it right. But, again, our objective is to allow — is to help these companies emerge stronger in the future so they can survive without government assistance.”
Of course had they left this all alone, we’d be 20 billion to the plus side and they’d already be in the middle of the bankruptcy process and well on their way to emerging as a stronger auto company.
Irony of ironies, I just picked up my new company car – a Chevy Malibu. It is a very nice car and has a lot of standard bells and whistles that I wouldn’t expect for a car of its price range. Frankly it’s not the engineering or the quality, as I see it – its legacy costs. And bankruptcy is the only way those are going to be actually approached and dealt with properly.
And you can’t lay this all off on the Obama admistration either – the Bush bunch was the first to throw money at the problem. However you can blame the Obama administration for continuing to do the same thing.
Time to back off, let the legal process that has worked for literally thousands of companies do its thing and see what comes out the other end. My guess is a stronger and more competitive GM.