General Motors, an American Institution went bust today,filing for Chapter 11 bankruptcy this morning.
As with Chrysler, the UAW made out like a bandit while the bondholders, including a number of retirees, took a total hosing.The entire bankruptcy and the GM restructuring plan are the product of a secretive, unaccountable Obama Administration task force.
The government now owns 60% of GM in exchange for an additional $30 billion in addition to the $20 billion GM was already given, essentially to keep the UAW afloat. The Canadian government kicked in for an additional 12.5% while the UAW will walk away with 17.5%. The remaining 10% will be owned by existing bondholders.
This is not going to be painless. Just closing of hundreds of GM and Chrysler dealerships (run by GOP donors, no doubt) is expected to cost more than 100,000 jobs.
The biggest hosing, of course, will be taken by the American tax payer and consumer. We'll be footing the bill in more ways than one.
We will see small, boxy little go-karts produced out of GM and Chrysler, stuff Americans would never normally buy but will be forced to..because there's no going to be any choice. That's what Obama's 39 MPG CAFE standards are all about.They'll do it not by making existing cars more fuel efficient but by simply eliminating SUVs and larger, more comfortable vehicles. With $5.00 per gallon gas thanks to cap and trade, no one's going to be able to afford to run a decent size vehicle anyway except the wealthy elites.
Obama will run GM based on politics, and that means the UAW and the various environmentalist groups.
GM will never be profitable again, simply because no executive is going to risk taking on the Unions and risking his job.
Once GM runs through this additional $30 billion ( and believe me, they will)they'll simply come to the taxpayers for more. And Obama and the Democrats in Congress will give it to them, because it's about votes and power, not economic recovery.
Don't like it? Sorry, folks. Those Obama Tickets you bought in November are good until at least 2010..and maybe even longer.