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Ear to the Ground

Out With the Old, In With the New GM

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Posted on Jun 1, 2009
GM Headquarters
Flickr / richardefreeman

The old colossus: GM’s headquarters in Detroit.

General Motors filed for Chapter 11 bankruptcy protection on Monday. Shortly after the announcement, President Obama tried to reassure taxpayers, who are effectively shelling out an additional $30 billion in return for a 60 percent stake in the company, according to the new restructuring plan. The “new GM” will shed 21,000 more employees and shut down 12 factories and 2,600 car dealerships.

Detroit Free Press:

President Barack Obama today hailed the government-led bankruptcy and restructuring of General Motors Corp. as “the end of the old GM and the beginning of a new GM,” even as he warned of its cost in taxpayer money and jobs.

Combined with the approval of Chrysler to be sold to Fiat, Obama said, the strategy of quick bankruptcies would result in stronger automakers who could compete on a global stage, and lead the world in developing fuel-efficient vehicles.

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Also, here is a New York Times article that might answer some of your questions about the GM bankruptcy case.

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By KDelphi, June 2, 2009 at 12:44 am Link to this comment

I am only concerned about the line-workers, because no one else seems to be.

If the upper middle class thinks that the working classes will put up with this reduced standard of livng—they are probably right.

What choices do they have—Tweedledumb and Tweedledumbass!

So, the “party of the working class”, handled is differently—how??

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By Samson, June 1, 2009 at 6:32 pm Link to this comment
(Unregistered commenter)

According to Google Finance, GM stock is at $0.75 per share.  The total ‘Market capitalization’ of the company is $457.92 million.  In other words, we could buy the whole dang company for just under $500 million.  We just gave them $30 billion for 60% of the company.

In return, we get a GM that is cutting American jobs, cutting the retirement and health benefits of Americans.  If we are going to massively overpay for the company, shouldn’t we at least get a company that is trying to look out for the interests of its now majority stockholder .... the American tax-payers.  Ie, exactly the same people who are getting screwed in the deal.

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By Blackspeare, June 1, 2009 at 3:05 pm Link to this comment

We are blaming the wrong party here——GM is not at fault——it’s those quality control freaks in Japan——who incidentally were inspired by an American industrialist after the war!  Imagine making a car that runs better, lasts longer, and costs less than a Chevy——who do they think they are!

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By KDelphi, June 1, 2009 at 1:35 pm Link to this comment

The “financial services industry” hasnt “produced ” anything, ever, and they got $2 trillion.

It is a class issue—-lawyers let lawyers off, millionaires bail out milionaires (with poor peoples’ money) and ask labor for more concessions:

100s of 1000s os retired workers lost pensions and health care benefits this weekend, and the Democrats dont give a damn.

“President Barack Obama and General Motors CEO Fritz Henderson are expected to make public statements after the filing. Despite their assurances of a “quick” and “orderly” bankruptcy and a “new start” for the company, the action will have a devastating effect on GM’s 230,000 global employees and the millions more who will be hit by plant shutdowns, the closing of more than 1,000 dealerships and the wave of failures of auto suppliers that is expected to follow.

GM, which has already announced plans to cut 47,000 jobs worldwide, including 23,000 of its remaining 62,000 hourly employees in the US, is expected to announce plans to close between 12 and 20 more plants. Communities in Michigan, Indiana, Ohio and other states already suffering high levels of unemployment, home foreclosures and poverty will be driven into even deeper crisis”

This is the end of what the uS used to call the “middle class”. If Dems cannot provide better solutions than this, what is the difference?

To hell with the Democrats. And dont complain next time you lose because of Ohio, Michigan, Indiana, etc. Of course, the Republic Party is supposed to be worse for the working poor, but, in truth neither party gives a rat’s behind about her working poor.

We need a Socialist and Labor Party. Democrats have had their chance.

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By BobZ, June 1, 2009 at 10:38 am Link to this comment

What a sad day for the United States of America, to see a once great car company go down in flames. I hope they can reemerge from bankruptcy and get their act together. I have watched them from afar slowly but surely go down the drain through terrible management practices. Since the early 1970’s they just haven’t built very good cars and were way over dependent on suv’s and truck sales to the exclusion of building good cars that people wanted. They no longer built vehicles people lusted after. Car people that used to buy GM cars gravitated toward BMW, Porsche, Mercedes, Honda, Lexus, and Toyota. They forgot how to make great automobiles. Yes they have a few good cars but not enough to offset all of the mediocre cars they make. They also let Toyota and Honda get in front on hybrid technology, an area where GM at one time had the lead. Paraphrasing what David E. Davis former editor of Car and Driver said “When the bean counters got put in charge of GM over the engineers, that was the start of GM’s decline”.  So true. Building good cars has to be a passion and GM lost that. They became just another big business entity instead of an icon.  A very sad day for car fans.

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