GM Refuels with Bankruptcy

It’s the biggest industrial bankruptcy ever in America’s history.

Hi, I’m Charlotte Bellis, and you’re watching Newsy.com.

The venerable U.S. automaker General Motors has agreed to bankruptcy protection in order to restructure.

The plan makes the U.S. government a 60 percent stakeholder in the new GM.

But is this a good idea?

We’re taking a look at different perspectives on this issue from the Detroit Free Press, the Wall Street Journal, the Washington Post and Rasmussen Reports.

An editorial in GM’s hometown paper, the Detroit Free Press, strikes an optimistic tone.

It calls the bankruptcy a “hopeful challenge”:

“It will be painful, especially for GM's home state. But it will offer the company a fresh start -- and it means there will be a next chapter.”

The Wall Street Journal counters that, saying the outlook isn’t so rosy.

It points out government ownership of GM, “present(s) a thicket of conflicts unlike any seen before in Washington”:

“It will simultaneously serve as the company's regulator, tax collector, customer, pension backstop and lender…given the size of the $50 billion U.S. investment, it will be hard for President Barack Obama and Congress to say they will remain uninvolved in a company saved only by taxpayer largesse.”


The Washington Post highlights complaints by GM investors that the bail out plan unfairly favors the United Auto Workers Union.

In a page 1 article it writes:

“The fairness issue will be central as the GM bankruptcy case goes before a judge this week…One group of individual investors, calling themselves the Main Street Bondholders, have already organized to protest their treatment.”

The media company Rasmussen Reports offers a just the facts perspective in a run-down of public opinion polls about the auto industry.

One survey found that only 21 percent of voters favored a GM bailout plan.

“Looking back at the bailout funding already provided, 60 percent say the auto bailouts were a bad idea. Two-out-of-three believe that most of the bailout money is going to those who caused the economic crisis.”