at the time of the issue it would have been very bad, instead the gov. loaned money, got it back. The alternative was the gov. let them fail, the suppliers down the line fail one after the other (trust me, the asset based lending lines we all operated on were not sweet if the cash did not flow) and pay out a ton more money in unemployment and welfare to keep people from turning to social chaos.... it was cheaper to loan some money and get it back133743Hokie wrote:GM bankruptcy would not have devastated the economy any more than failing banks or mortgage lenders did. Your personal closeness to this has clouded your view. I suggest you read any of the many papers and books written on this matter and you'll see things differently.HokieJoe wrote:1) The government could not allow GM to go out of business, period. The ripple effect thru tiered suppliers would've devastated the economy.
2) GM is also a strategic asset in the event war occurs, so no, going out of business was not an option.
3) UAW members should've taken a bigger haircut because their bloated contracts played a VERY large role in why GM was 'restructured'.
GM isn't any more "strategic" than dozens of other businesses. Given how wars are now fought they would be a minor player at best, and even then only in a holocaustic type of war.
Tesla fired up to 700ppl this week.
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Re: Tesla fired up to 700ppl this week.
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Re: Tesla fired up to 700ppl this week.
Actually, it was politically expedient to choose "winners" and that is what they did. This wasn't about determining how best to soften the economic downturn, it was about how to maintain political power without a blowback from their side.cwtcr hokie wrote:at the time of the issue it would have been very bad, instead the gov. loaned money, got it back. The alternative was the gov. let them fail, the suppliers down the line fail one after the other (trust me, the asset based lending lines we all operated on were not sweet if the cash did not flow) and pay out a ton more money in unemployment and welfare to keep people from turning to social chaos.... it was cheaper to loan some money and get it back133743Hokie wrote:GM bankruptcy would not have devastated the economy any more than failing banks or mortgage lenders did. Your personal closeness to this has clouded your view. I suggest you read any of the many papers and books written on this matter and you'll see things differently.HokieJoe wrote:1) The government could not allow GM to go out of business, period. The ripple effect thru tiered suppliers would've devastated the economy.
2) GM is also a strategic asset in the event war occurs, so no, going out of business was not an option.
3) UAW members should've taken a bigger haircut because their bloated contracts played a VERY large role in why GM was 'restructured'.
GM isn't any more "strategic" than dozens of other businesses. Given how wars are now fought they would be a minor player at best, and even then only in a holocaustic type of war.
Lots of businesses struggled, lots of businesses had cash flow problems, lots of businesses laid off workers. GM was not unique at all. They just made the most sense politically, and the union was saved to support the rust belt voters.