Should The Government Bailout The Auto Companies II?

On November 6, 2008 we wrote how the government should not give the auto companies a loan until they forced them into a prepackaged bankruptcy. It took over six months and some wasted taxpayer money but the government finally got it. The auto industry is about to be deleveraged and the legacy operational cost structures and benefit plans improved to give the United States car companies a fighting chance to compete.

We applaud the GM process as being fairer to creditors than the Chrysler case. Perhaps the government realized that strong arming creditors isn't the best way to approach debt investors as they did with Chrysler. We are not opining on whether everybody got their fair share in the proposed new GM but at least it is not totally unjust. The completion of the bankruptcy process for GM will take at least 2 to 3 months but hopefully when the company is restructured, it won't need anymore government financial assistance.