Should the Big Three auto companies be allowed to go bankrupt?
If they do go bankrupt, won’t that leave the small suppliers holding the bag for money owed to them by Ford, Chrysler, and GM? How would that impact the economy?
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This would be a bad situation for our country. We are already in dire straights due to the last 8 years of bad policy from Washington.
If the Big Three are forced into bankruptcy, they will not be Chapter 11 or reorganization, it will be Chapter 7 liquidation. This would directly affect 3 million American Taxpayers in the plants, suppliers and dealers across this country. With the elimination of all those jobs, you lose the taxes that they pay in their communities affecting local firefighters and police, they need unemployment costing taxpayers more. Then the communities and businesses they spend money at are affected and they lose money those consumers would normally spend.
It shocks me that we can give tax breaks and incentives to foreign countries to build auto plants in this country creating a competitive disadvantage to American companies who have been here for over 100 years, but we cannot give them a loan to get them through a bad time.
Yep
I’m OK with it but yes the smaller suppliers could be hurt by it..
NASCAR nation would fail. I think instead of a bailout all these Obama supporters with the bumper stickers on their imports should start buying from the country they supposedly love.
they should !
Bankrutpcy right now wouldnt help them. Their debts would not be wiped out. Bankruptcy would only protect them from their creditors. Right now their creditors are not coming after them.
They shouldn’t be allowed to go bankrupt.
A bankrupcy would make them un-able to pay their trade debts off, and thus un-able to build cars in the USA because of a lack of parts. The auto suppliers are all connected. They supply parts not only to The Big 3, but also to some foreign car companies like Toyota.
A carefully planned bankrupcy would throw 479,000 retirees unto to the Pension Benefit Guaranty Corp., which would effectively overwhelm the system.
Contrary to popular belief, the auto parts trade is fairly inter-connected. Some suppliers supply parts to more than 1 company, but if 1 company were to suddenly become unable to buy parts, the other companies would be affected as well, eventually going back to some of the foreign companies like Toyota and Honda.
So the whole industry would take a fall.
they could file chapter 11 and restructure. Of course employees will lose some of their medical benefits, draw only 66% unemployment if they’re laid off…in other words they will be just like us. Taxpayers who have no insurance and only draw for 6 months 66% of a 40 hour per weeks pay for only 6 months.
Since they have no plans to change, bankruptcy is almost inevitable.
The execs flew to DC in their private jets, spending a couple of hundred thou to do so, and they still are getting about $ 20,000,000 per year, even though they are failed execs of failing companies.
If the companies can still afford the jets, the humungous salaries—they don’t need taxpayers’ money.
They haven’t learned to economize, and they haven’t learned to build cars that people want to buy.
We may as well flush the money down a toilet as to give it to them, so that they can keep their multimillion-dollar salaries and jets and other perks.
How about having big oil bail them out? They kept building the gas guzzlers that made the oil companies so many billions of dollars, seems to me that the oil companies should help them, out of gratitude!
Yes. They will them be reorganized and will have a chance to become profitable again. The suppliers would be paid under chapter 11.
No they need to be helped right now. If they went bankrupt at this time they’d be in a situation where they’d more than likely fail, as in not exist anymore. No one buys cars from bankrupt companies, so they couldnt pull themselves out of hole their in without money coming in. That would be the absolute WORSE thing for this fragile economy. 3 million + jobs would be lost. That would be an unprecedented amount since 1929.
This would effect foreign automakers negatively as well b/c so many jobless people wouldn’t even think about buying a new car. There are 600,000 people on retirement pensions through GM + 100′s of 1000s more for ford and chrysler. The effect would just be catastrophic, ecspecially in areas of Michigan,Ohio, Indiana, etc where the big 3 are the backbone of their economies and many retirees like.
But I do like that congress is forcing the big 3 to make a plan b/c they definitely need a good plan to come out of this. Bankruptcy would pretty much be a cut to the jugular right now for them. I sure hope they can get out of it, b/c my dad and grandpa both get pension from GM, my grandpa is 80 years old with no other income but that so it’s a scary thought for the retirees as well.