Government Motors Follies: Surgical Taxpayer-Soaking Edition

posted at 4:39 pm on April 14, 2009 by

In our last episode, I commented that The Atlantic’s Megan McArdle may have been mistaken in thinking a General Motors bankruptcy was “inevitable”:

McArdle may be underestimating the lengths to which the Obama Administration and a Democratic Congress will go to bail out the UAW and its electorally-important, white, blue-collar, workers in the swing states of the upper Midwest.

Ed Morrissey highlights today’s New York Times report that GM has prepared a “surgical” bankruptcy, in which taxpayers would shell out tens of billions of dollars to cover the legacy costs of the company’s health care obligations. Cap’n Ed is shocked:

I suspected that any real resolution to this would require restructuring of GM’s pension obligations. I didn’t expect that we would have to completely underwrite them.

I don’t know how Ed could have expected anything else.

Cross-posted at Patterico.

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As usual, the UAW is going to come out just fine. Treasury had to watch out for its loyal union bloc.

Nethicus on April 14, 2009 at 5:01 PM

First it would have been nice if they had gone the bankruptcy route before we gave them a ton of money. And now the government is going to do some Obama Era bankruptcy the requires the taxpayers to give still more money. Ridiculous.

Cindy Munford on April 14, 2009 at 7:36 PM

How can Obama re-write bankruptcy law? How is this happening?

SarahW on April 15, 2009 at 12:57 AM