WHY BANKRUPTCY IS THE BEST OPTION FOR GM

General Motors is a once-great company caught in a web of relationships designed for another era. Instead of a taxpayer-funded bailout, GM should be allowed to go bankrupt, says Michael E. Levine, a distinguished research scholar and senior lecturer at New York University School of Law. [snip]

GM has about 7,000 dealers, Toyota has fewer than 1,500 and Honda has about 1,000:

• These fewer and larger dealers are better able to advertise, stock and service the cars they sell.
• GM knows it needs fewer brands and dealers, but the dealers are protected from termination by state laws.

Foreign-owned manufacturers who build cars with American workers pay wages similar to GM's, but their expenses for benefits are a fraction of GM's:

• GM is contractually required to support thousands of workers in the UAW's "Jobs Bank" program, which guarantees nearly full wages and benefits for workers who lose their jobs due to automation or plant closure; consequently, it supports more retirees than current workers.

And then there's the Union workers' retirement 'benefits'...

[Reminder: 'chapter 11' bankruptcy is meant to be a mechanism through which debts and contracts are restructured to allow continued operation - but the mowtown three have said 'it's not for them'...]

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