Judge Clears The Way For GM

It looks like the darkest days may be over for auto giant General Motors (GM). The company is now in bankruptcy court, but a judge has just cleared the way for a quick exit. Some personal injury claimants (pursuing a product liability claim against Chevy's Malibu) were trying to delay the sale of the most profitable parts of GM. The judge has refused to do that.

Now GM can go ahead and sell those "profitable" parts of itself to a "new" smaller version of GM. This smaller GM will be 60% owned by the U.S. government, 12% owned by the Canadian government and 17.5% owned by the United Auto Workers union. The rest (about 10.5%) will be owned by GM bondholders.

With about 72% of the company being owned by the governments of the United States and Canada, it would be pretty accurate to call the new company Government Motors. At least they won't have to change their acronym -- GM.

I'm not crazy about the government owning a majority of GM. It was very expensive ($60 billion), and we have no assurance the government will do any better job than the greedy bastards who used to run the company. My only consolation is that executives probably won't be receiving huge bonuses while laying off workers.

In addition to being government-owned, the new GM is supposed to be smaller and more profitable, with a smaller workforce and smaller debt. As much as I don't like this, it was probably better than the alternative -- GM going belly-up. Our economy has already lost too many jobs, and GM going out-of-business would have been devestating.

I just hope the new GM will be profitable, and that someday soon the government can sell its part and get all our money back -- including a nice profit for taxpayers.