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GM Gets To Dump Its Polluted Sites

Soulskill posted more than 4 years ago | from the too-big-to-clean dept.

Earth 336

ParticleGirl writes with this excerpt from the Detroit Free Press: "GM's unusual, government-engineered bankruptcy allowed the Detroit automaker to emerge as a new company — and to shed billions in liabilities, including claims that governments had against GM for polluting. Environmental liabilities estimated at $530 million were left with the old GM, which has only $1.2 billion to wind down. Administrative fees and other claims will soak up that money, and state and local officials told the Free Press they fear the cleanups will be shortchanged. ... The New York Attorney General's Office, seeking to protect environmental claims for cleanup at Massena and other sites, argued that federal and state regulatory requirements should not be eliminated by a bankruptcy sale. ... But [US Bankruptcy Judge Robert Gerber] ruled otherwise."

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336 comments

Both GM and Chrysler were handle poorly (4, Interesting)

WindBourne (631190) | more than 4 years ago | (#28997015)

Both GM ans Chrysler were let off the hook on the 10's (or it is hundreds) of billions that they owed. Then we forced Chrysler to be sold to Fiat for next to nothing. Fiat Will keep it open for th next 2 years and then close all American plants (unless some are newer than theirs) after absorbing the IP. GM is currently forcing their partners to move operations to China, rather than keep them here. Chinese gov. is insisting on it (jingoism at its best). Worse, we are STILL subsidizing them with loans as well as CARS garbage. What should have happened is that GM and Chrysler SHOULD have been broken up into multiple companies and than allowed to compete. The problem with both of these was BAD CEOS. OTH, if you break them up, then you have multiple CEOs, which is likely to leave at least several of them doing OK to great. As it is, these companies will be gone within 5 years.

Re:Both GM and Chrysler were handle poorly (4, Insightful)

Anonymous Coward | more than 4 years ago | (#28997059)

No, no, and no.

GM and Chrysler should have been left to die. Period. They're businesses sucked and so did they're products.

The only thing the government bailouts did was keep these bloated poorly run companies alive for a few more years - at the taxpayer's expense. In the meantime, the execs and union members have a few more years of being over paid - at the taxpayer's expense. A few years from now, they'll be back exactly where they were a few months ago and we'll be a few hundred billion dollars poorer.

Re:Both GM and Chrysler were handle poorly (-1, Troll)

Anonymous Coward | more than 4 years ago | (#28997113)

Please learn the differences among "their" and "there" and "they're" before you decide you're going to tell us a thing or two. It's your native fucking language so quit being so silly.

Another thing that is trendy is trying to use "loose" as a verb because you don't understand the difference between "lose" and "loose". It's trendy because you never saw that anywhere and suddenly tons of people start making this one mistake like the little clockwork sheep that they are. It's just another good way to scream HEY I AM EITHER CARELESS OR STUPID SO PLEASE DISREGARD MY MESSAGE! Functionally illiterate bastards, all of you.

Oh and your mother sucked my dick last night.

Re:Both GM and Chrysler were handle poorly (-1, Troll)

Anonymous Coward | more than 4 years ago | (#28997195)

No, your mother did NOT suck my dick last night.

Re:Both GM and Chrysler were handle poorly (0)

Anonymous Coward | more than 4 years ago | (#28997265)

mod parent up +1 LITERATE

Re:Both GM and Chrysler were handle poorly (0)

Anonymous Coward | more than 4 years ago | (#28997613)

Grammar police over here. Why do you get so worked up and offensive about their grammar? I know it's easy to act like a badass on the internet, but it doesn't make you cool. Just makes you look like an asshole with no life. Have a good day.

Re:Both GM and Chrysler were handle poorly (0)

Anonymous Coward | more than 4 years ago | (#28997741)

Grammar police over here.

The proper term is 'Grammar Nazi'. And yes 'they' will come and take you to the camps...

On a side note, every Saturday is now 'Godwin Appreciate' day here on slashdot. The best reference to Hitler or the Nazi's wins you absolutely nothing just like posting anything to begin with...

Re:Both GM and Chrysler were handle poorly (0, Offtopic)

QuoteMstr (55051) | more than 4 years ago | (#28997751)

I know it's easy to act like a badass on the internet, but it doesn't make you cool.

Go ahead, mutilate the English language. But anyone who matters will completely disregard your statement if you can't be bothered to the basic rules of grammar. If your writing is unstructured, then your thoughts most likely are as well.

no life

You realize this is slashdot.org, right? "News for Nerds, Stuff that Matters"?

Re:Both GM and Chrysler were handle poorly (1, Funny)

Anonymous Coward | more than 4 years ago | (#28997693)

I am so glad someone points out the annoying mixing up of "lose" and "loose".

So people know the difference, it is like dropping the soap in a prison shower. You LOSE your anal virginity and your sphincter become LOOSE like you wouldn't believe it. That beats what happens if you mix up the placement...

*neat, captcha is "wicked"...

Re:Both GM and Chrysler were handle poorly (-1, Offtopic)

legirons (809082) | more than 4 years ago | (#28997811)

Please learn the differences among "their" and "there" and "they're" before you decide you're going to tell us a thing or two. It's your native fucking language so quit being so silly.

she wrote something informative but misspelled (while clearly understandable). You however are a waste of bandwidth. Journalists who can clearly trace and describe the theft of hundreds of billions of dollars are more important than reviewers who can spellcheck.

Re:Both GM and Chrysler were handle poorly (0)

Anonymous Coward | more than 4 years ago | (#28997871)

hope you enjoyed it - shes been dead the last 5 years

Re:Both GM and Chrysler were handle poorly (0)

Anonymous Coward | more than 4 years ago | (#28997905)

Oh and your mother sucked my dick last night.

So, You admit being into necrophilia.

Re:Both GM and Chrysler were handle poorly (4, Insightful)

tkrotchko (124118) | more than 4 years ago | (#28997839)

Yes, in business, it's cruel to be kind in so many ways.

If they would have been left to normal bankruptcy, GM could have done the right thing, dropped it's union contracts, reshaped it dealers, etc.

Instead, the bankruptcy was railroaded through as quickly as possible to have the smallest impact on the unions. Ironically, this will be worse for the workers in the long run and worse for GM. Definitely worse for taxpayers as we're fleeced to shut down these companies rather than let nature take it's course.

What we're doing is the equivalent of feeding an injured deer in the winter. The deer still isn't going to survive and you wasted a lot of good food that could be used to feed more viable animals.

Re:Both GM and Chrysler were handle poorly (4, Insightful)

MightyMartian (840721) | more than 4 years ago | (#28997863)

Actually, what's been accomplished is worse than that. What US and Canadian taxpayers have done is essentially underwrite the inevitable move of manufacturing vehicles by Chrysler and GM to China and Mexico. I guarantee you, in ten years they won't be running any plants in the US. There will probably be more Japanese cars being made here than American cars.

Re:Both GM and Chrysler were handle poorly (3, Insightful)

ravenshrike (808508) | more than 4 years ago | (#28997073)

Horseshit. The unions were much more complicit in the downfall of GM and Chrysler than the last few crops of CEO's at either company. Moreover, given the stock holdings that the union was given at GM, anything bad that happens to that company is now completely their fault. The fact that they sold most of it is absolutely no excuse.

Re:Both GM and Chrysler were handle poorly (0)

Anonymous Coward | more than 4 years ago | (#28997281)

Sorry but you are the one shoveling horseshit. Union members don't design the cars. GM and Chrysler have been putting out shit vehicles that would still be shit at half the price. Nice pro-corporate cheer leading though.

Re:Both GM and Chrysler were handle poorly (2, Interesting)

Anonymous Coward | more than 4 years ago | (#28997457)

So you're saying that hourly workers on the assembly lines should have refused to build the crappy designs mandated and approved by GM top management? They should have taken one look at the first Pontiac Aztek off the line and walked out in disgust? They should have refused to build any more inefficent pushrod engines when every other car company had gone to multiple overhead cams?

GM started going to hell on the day when bean counters took over top management. Until sometime in the late 1960s GM was manufacturing company, after that time they became a profitable financial company that happened to manufacture cars as an sometimes unprofitable sideline. And their products clearly reflected this reality.

Re:Both GM and Chrysler were handle poorly (3, Interesting)

zippthorne (748122) | more than 4 years ago | (#28997697)

No, I think he's saying that the union's ratcheted up benefits and obligations upon the company, which forced those crappy designs down the line so that the margins would be high enough to pay for all those obligations. Unfortunately for GM, they depended on ever-increasing sales of ever crappier cars to maintain their obligations to the workers. Namely, the very important and conflicting obligations of workforce size and worker benefits: you can't increase worker pay/benefits without improving productivity (using automation as one of many tools) and laying off extra employees.

Well, you can, if you borrow against a future that cannot ever exist because you're simultaneously cutting corners left and right. And when sales couldn't keep up with the debt/obligations (unexpectedly, due to outside conditions), the gamble paid off: the government took on, co-signed, or relieved those costs.

Re:Both GM and Chrysler were handle poorly (0)

Anonymous Coward | more than 4 years ago | (#28997643)

Horseshit. The unions were much more complicit in the downfall of GM and Chrysler than the last few crops of CEO's at either company. Moreover, given the stock holdings that the union was given at GM, anything bad that happens to that company is now completely their fault. The fact that they sold most of it is absolutely no excuse.

Do you have any facts to backup your statements?

Re:Both GM and Chrysler were handle poorly (2, Insightful)

WindBourne (631190) | more than 4 years ago | (#28997653)

You going to blame the JANITOR as well? In the end this was PURELY about BAD MANAGEMENT. It is THEIR JOB to made decisions. It is THEIR job to MAKE MONEY. The vast majority of car companies HAVE UNIONS (all of the europeans) and YET, they make money. In fact, the best one currently is VW. They are going like gangbusters. Why? BECAUSE OF GOOD MANAGEMENT.

Re:Both GM and Chrysler were handle poorly (-1)

sumdumass (711423) | more than 4 years ago | (#28997929)

Actually, as it was pointed out with the differences between the foreign car makers and GM, the total cost of employing someone at the imports were roughly $38 an hour compared to $78 am hour at GM.

The only difference in management is how strong the Unions are. IF they are strong and demand more money, any of the import manufacturers can become the equivalent of GM tomorrow. This is because the laws protect the union to the companies Expense.

Re:Both GM and Chrysler were handle poorly (5, Informative)

larry bagina (561269) | more than 4 years ago | (#28997251)

It's even worse. Ford (or more accurately, CEO Alan Mulally) saw the impending doom and got ahold of as much cash and lines of credit as they could and were able to avoid bankruptcy. Car companies (especially GM!) don't make money by selling cars so much as they do by financing car sales. GMAC was also the recipient of multiple rounds of government financing and has FDIC backing and access to below-market government financing. In order to increase GM sales, GMAC lowered their standards (sound familiar?) and offers 0% loans. Meanwhile, Ford Motor Credit needs to borrow money on the open market at rates of 10% or so.

If you look at Edmund's analysis [cnn.com] of the CARS program, Ford has 4 of the top 10 (including the higher margin F150 and escape SUV). The official government figures [cnn.com], however, are broken out so that high milage (and mostly foreign) cars look more popular.

Re:Both GM and Chrysler were handle poorly (1)

QuoteMstr (55051) | more than 4 years ago | (#28997703)

If you look at Edmund's analysis of the CARS program, Ford has 4 of the top 10 (including the higher margin F150 and escape SUV). The official government figures, however, are broken out so that high milage (and mostly foreign) cars look more popular.

Thanks. I can't think of a way to describe the government statistics as anything but "misleading". It really doesn't matter, though, whether the Focus or the Escape is at the top of the list, except for PR purposes. What does matter is the aggregate fuel economy improvement, which is not in dispute, and the economic stimulus multiplier factor (which is also not in dispute). By the measurements that matter, the program has been a surprising success.

Re:Both GM and Chrysler were handle poorly (4, Insightful)

YayaY (837729) | more than 4 years ago | (#28997261)

It's funny how companies talk about free-market and ask the government not to regulate their market when the economy is good. But then when the economy goes bad, they put their tails between theirs legs and they ask for government help.

This is no longer a free-market A government owned car compagny? It feels like communism.

Re:Both GM and Chrysler were handle poorly (3, Insightful)

smaddox (928261) | more than 4 years ago | (#28997345)

Welcome to the real world. No one likes the government, unless of course the government is giving them a free lunch.

Re:Both GM and Chrysler were handle poorly (0)

Anonymous Coward | more than 4 years ago | (#28997609)

This is no longer a free-market A government owned car compagny? It feels like communism.

Welcome to the real world. No one likes the government, unless of course the government is giving them a free lunch.

Hummmm, no longer a free-market?.. communism?.. free lunch?.. 1930s bread lines?.. Hey wait, no one likes waiting in communist bread lines... Also no one likes the Nazi's ether, OMG I see!!!

Hitler runs the free market! OMG I had no idea, We gotta continue to stop this free market thing before the Jews go back to the ovens...

Re:Both GM and Chrysler were handle poorly (2, Informative)

dunkelfalke (91624) | more than 4 years ago | (#28997797)

What IP?

Fiat isn't a small backyard shack it was 50 years ago. Fiat owns Alfa Romeo, Lancia, Iveco, Maserati and even Ferrari.
I don't think Chrysler has got anything IP-wise Fiat doesn't have.

LLC's in a nutshell (1, Insightful)

Anonymous Coward | more than 4 years ago | (#28997023)

Heads you alone win, tails you and everyone else loses.

Good work Obama (0, Flamebait)

Anonymous Coward | more than 4 years ago | (#28997025)

You sure are getting things done.

Sweet (4, Insightful)

smchris (464899) | more than 4 years ago | (#28997029)

As radio announcer Thom Hartmann says, corporations want to privatize the profit and dump the liabilities on the commons. That's the ticket.

Re:Sweet (4, Interesting)

clang_jangle (975789) | more than 4 years ago | (#28997167)

They don't merely want to do that, they actually do it. A corporate entity's rights are vastly superior to those granted a human citizen here in the US. That's what makes this country a socialist state for the rich, and a totalitarian state for everyone else.

Re:Sweet (1, Redundant)

Ironsides (739422) | more than 4 years ago | (#28997593)

Oh? Name one right a corporate entity has that is superior to that of a citizen?

Re:Sweet (2, Insightful)

Anonymous Coward | more than 4 years ago | (#28997677)

After being convicted of killing a person they are allowed to continue conducting business. A citizen would be incarcerated, effectively ending their ability to conduct business.

Re:Sweet (2, Insightful)

KDR_11k (778916) | more than 4 years ago | (#28997699)

The ability to crush private people with legal costs. It's not spelled out on the books but they'd be stupid to do that.

Re:Sweet (0, Offtopic)

Anonymous Coward | more than 4 years ago | (#28997799)

RTFS, n00b! WTF do you think this story is about?

Re:Sweet (2, Insightful)

zippthorne (748122) | more than 4 years ago | (#28997805)

They can deduct their cost of living from their income to offset the taxes they have to pay.

Try deducting your car's mileage or your restaurant or grocery bills or depreciating your house, car, furniture, appliances, etc. on your next return and see where that gets you.

Re:Sweet (1, Informative)

sumdumass (711423) | more than 4 years ago | (#28997987)

Actually, you can deduct all of those things if they are part of your income generation and not incidental private expenses.

I don't think you realize that a corporation is nothing more then an income generator. You can write the same shit off without a corporation being present as long as it follows the same guidelines of income creation.

Re:Sweet (0)

Anonymous Coward | more than 4 years ago | (#28998015)

Limited liability and perpetual lifetime. The 1st one is good for capitalism and investors however the very thin ice argument can be made that this limited liability allows corps to do things on investors behalf that the investor would not want to get his hands dirty with. The perpetual life... When US citizens die they get the family estate gets dinged by IRS for taxes owed as well as an additional estate tax. There isn't an equivalent for corps just because a CEO dies or retires does not mean they get dinged with extra taxes.

Re:Sweet (1, Interesting)

Anonymous Coward | more than 4 years ago | (#28997599)

As someone pointed out in an earlier discussion here, that makes our country corporatist, in that the government exists for the corporations, not the other way around.

Obama has taken trickle down to the wrong level (5, Insightful)

Shivetya (243324) | more than 4 years ago | (#28997433)

Wall Street, instead of having to wait for Reagan's tax breaks to make money found a new comer who accelerated the plan buy just paying them the money upfront.

GM and Chrysler were bailed out for Wall Street and the Unions. Though don't confuse Unions with the rank and file, I am talking about the leadership who decides where the money is spent and offer muscle to intimidate anyone the administration doesn't like (see AFL-CIO's new leader who thinks murder and violence are fine if you can get away with it - or pay it off).

GM had the ultimate sweet heart deal of the two rescues. Not only did they get out of cleaning up all their pollution they also got a tax bump by keeping the tax write offs from bad GM to prop up new GM. Hence companies which play by the book and make sensible deals like Ford get doubly screwed.

Send Washington a message, avoid GM and Chrysler products. We are being run over by the goons in Washington and since our vote counts for very little the next year the only fight we have left is our pocketbooks

Re:Sweet (1)

fermion (181285) | more than 4 years ago | (#28997951)

I do not know of a case where a private firm paid for the cleaning and mitigation of it's own mess. It just isn't done. It is just too simple to delay the process, in which the case we the people have to step in to protect ourselves, hoping to get some compensation later on.

For instance, the Exxon Valdez has never been fully cleaned up and the funds to help those damaged has yet to be paid. You can bet if I burned down the exxon building, they would make every effort to have me pay for every cent that I could.

After 30 years, GE is finally cleaning up some of the hudson river. It is unlikely they will do the job they were originally asked to do. To this day, we are paying for the storage of nuclear waste, with no plan to get rid of it, and more on the way.

The point is that we are to protect ourselves, we must have regulation, fines, and monies for mitigation. The later comes from taxes on the corporations, of which we have seen less of in the past 30 years. What we have seen is skyrocketing deficits from the war on drugs, war on terror, and general expenditures to protect we the people from the few that values money more the people, the socio- and psychopaths that seem to make up some percentage of those in control.

So I am not so worried that the costs are externalized. If we are to maintain our lifestyle we must protect ourselves against our souless neighbors. My concern is that in our zeal to make government small, we are leaving ourselves open to abuse by those without ethics. It would be one thing if I could get the firms who metaphorically shit on my lawn out of the neighborhood in the same way I can with drug dealers, but I can't. But if they pay taxes, and there are regulation, then at least I do not have to personally pay to have it cleaned up.

The road to hell... (3, Informative)

Majik Sheff (930627) | more than 4 years ago | (#28997031)

is paved with good intentions. Notice to government officials and their supporters: QUIT TRYING TO FIX STUFF, YOU ONLY MAKE IT WORSE.

Re:The road to hell... (4, Funny)

FooAtWFU (699187) | more than 4 years ago | (#28997051)

The road to hell is paved with good intentions

If you look it up, that's actually a shovel-ready infrastructure project that's part of the stimulus package!!

What do you want them to do? (4, Insightful)

Brian Gordon (987471) | more than 4 years ago | (#28997033)

They have no money to pay for it. Even if the government didn't excuse the debt, it wouldn't ever be paid.

Re:What do you want them to do? (2, Insightful)

JeffSh (71237) | more than 4 years ago | (#28997169)

exactly. The alternative is that GM goes completely out of business and is no longer a going concern, and then the liability of cleanup still falls on government, if it ever got done at all.

So, there's not really good news anywhere in all this. I hate it just as much as anyone else, but we need to be practical.

Re:What do you want them to do? (0)

Anonymous Coward | more than 4 years ago | (#28997325)

Then help them out but demand they pay it back later. Oh the companies just LOVE the US now.

Re:What do you want them to do? (2, Insightful)

Daniel Dvorkin (106857) | more than 4 years ago | (#28997747)

The alternative is that GM goes completely out of business and is no longer a going concern, and then the liability of cleanup still falls on government, if it ever got done at all.

$530 million is a lot of money, but what's the total salary and benefits of GM's BoD and C*O-level executives? I'll bet it's in the billions. Make them pay for it -- by garnishment of wages if they stay on, or if they quit, make the IRS responsible for collecting the money. I guarantee you, we (as in We, The People) will get the money back. They might, I don't know, have to sell off a few private jets or something. Boo hoo.

Oh wait, that would be socialist and if it became standard practice we might scare off the top talent who have the unique skills needed to run American business! Oh noes!

Re:What do you want them to do? (0)

Anonymous Coward | more than 4 years ago | (#28997757)

The alternative is that GM goes completely out of business

...and the downside is? A crappy business that's been a drain on the US taxpayer for the past 30 years finally disappears?

Re:What do you want them to do? (1)

QuoteMstr (55051) | more than 4 years ago | (#28997771)

So you think it'd be a good thing if, at a sweep, we lost hundreds of thousands of jobs and our last domestic manufacturing base?

Re:What do you want them to do? (0)

Anonymous Coward | more than 4 years ago | (#28997853)

So you think it'd be a good thing if, at a sweep, we lost hundreds of thousands of jobs and our last domestic manufacturing base?

Yes, yes, I do. If you're not making a profit you need to make room for the companies that are.

Re:What do you want them to do? (3, Interesting)

Rogerborg (306625) | more than 4 years ago | (#28997323)

In other words, fuck the environment, fuck everyone else, fuck any responsibility for anything that any corporate entity does to anyone or anything, ever. Capitalism means being able to take a huge steaming dump in the neighbor's pool and then just walk away from it, and that's the way it should be.

I think that's what you meant to say.

Or perhaps, just perhaps, the system could and should be weighted towards subdising and guaranteeing jobs that clean up pollution, rather than jobs that create it. They both keep people in work, and they both provide a service to the tax payers that are paying for them. The difference is the visibility of that service. Unfortunately, Joe Voter would rather his taxes go towards subdisising his God-given right to buy a "cheap" SUV (cheap if you ignore the tax money that he already paid to enable it to be built), than to some theoretical hippy horseshit like cleaning up the water table under his kid's schoolyard.

Sorry... sorry, I think my Soma is wearing off. For a moment there I almost thought that we don't live in the best of all possible worlds. My bad.

Re:What do you want them to do? (0)

Anonymous Coward | more than 4 years ago | (#28997505)

In other words, fuck the environment, fuck everyone else, fuck any responsibility for anything that any corporate entity does to anyone or anything, ever. Capitalism means being able to take a huge steaming dump in the neighbor's pool and then just walk away from it, and that's the way it should be.

Now you're catching on.

Say it with me. Corruptionnnnn! (0)

Anonymous Coward | more than 4 years ago | (#28997049)

So if the government is willing to do this for a company that is going into bankruptcy, imagine what they are doing for industries and companies that turn a profit.

This is just another tell tale sign that our government has been bought and paid for.

Re:Say it with me. Corruptionnnnn! (1)

FlyingBishop (1293238) | more than 4 years ago | (#28997119)

Yeah, it's high time our government stood up and made impossible demands of industry. That'll show 'em!

Here is a Reason Why the Free Market Works Best (5, Insightful)

reporter (666905) | more than 4 years ago | (#28997067)

If General Motors (GM) were allowed to enter bankruptcy without a government bailout, then GM would likely have been purchased in whole, or in parts, by a European or Japanese auto company. The purchaser would have assumed all of GM's liabilities. Of course, the sale price would have been set to reflect the costs of these liabilities.

However, because Americans allowed Washington (and Barack Hussein Obama) to effectively nationalize GM, Americans received the worst of all worlds. Washington poured billions of dollars into the company, and that money comes from future taxpayers. GM retains its rotten management although some talking heads at the very top of the pyramid were replaced: that management misread the market and failed to steer research and development toward highly efficiently small cars when gas prices were skyrocketing. Unions with their gold-plated medical insurance (now paid by the government) retain a stranglehold on the company, now literally owning part of GM.

Worst of all, we discover that the "new" GM will not be paying the costs of cleaning up the environmental pollution that the "old" GM caused.

We could have avoided all these problems if either Toyota or Renault had purchased the relevant bits of GM. Why do Americans "fear" working for a Japanese or French boss so much they are willing to nationalize a car company?

Re:Here is a Reason Why the Free Market Works Best (1)

FlyingBishop (1293238) | more than 4 years ago | (#28997147)

BS. If it were a free market, people would purchase the good parts of GM, and the rest would sit and languish, eventually petering out. If you had to purchase the good with the bad, no one would do it. That's a recipe for a loss, not a gain. The only way that would work is if they could be paid to take on GM's responsibilities. No one will buy something they know will be a loss.

Re:Here is a Reason Why the Free Market Works Best (-1)

Anonymous Coward | more than 4 years ago | (#28997149)

If you think we're just going to roll over and give up one of the last great bastions of American manufacturing, you can kiss Barack's patriotic ass. He kept that company in America where it belongs. Oh, and we'll clean up the pollution and then some soon, it's just a bit farther down on the list than averting economic disaster (based on the latest expert reports, disaster is actually being averted pretty effectively).

Re:Here is a Reason Why the Free Market Works Best (1)

Dustie (1253268) | more than 4 years ago | (#28997405)

If you think we're just going to roll over and give up one of the last great bastions of American manufacturing, you can kiss Barack's patriotic ass.

Americans really are good patriots!

They would rather bring down the whole nations economy and pollute the world than lose some brand to foreigners even though they can't even compete anyways. Bravo! No wonder Americans got the reputations they do - even in nations that are supposed to be their closest allies in wars around the globe.

Did you ever travel out in the world? Sadly most places I have been they dislike Americans because of the few rotten apples you got (Well, I assume it is a minority at least!) that behave as if they own the globe.

Re:Here is a Reason Why the Free Market Works Best (1)

Attila Dimedici (1036002) | more than 4 years ago | (#28997193)

Why do Americans "fear" working for a Japanese or French boss so much they are willing to nationalize a car company?

Americans don't fear working for a Japanese or French boss, the UAW (the union bosses much more than the rank and file) fears a Japanese or French owner of these companies because in either of those cases if the UAW insisted on wages above market, the owners would just close the plants. This takeover never had popular support among Americans, check the polling data.

Re:Here is a Reason Why the Free Market Works Best (3, Insightful)

cdrguru (88047) | more than 4 years ago | (#28997225)

If GM had escaped from its union contracts through a bankruptcy, it would have started a trend of other severly underwater employers using the same tactic to escape their union responsibilities. No Democrat administration could possibly allow the end of union featherbedding and union gold-plated benefits. Hence the bailout, with the assurance that the unions would continue to receive their benefits.

There was no other way it was going to happen without a Reaganesque union-busting administration at the helm. Obama is going to give us unions whether we want them or not through the fair choice act, so how could he destroy them?

Re:Here is a Reason Why the Free Market Works Best (5, Insightful)

bzipitidoo (647217) | more than 4 years ago | (#28997597)

You sound disparaging of unions. Businesses are always pulling crap. They'll take everything we let them take. They're always looking for an angle, always trying to game the system. They feel they must, to stay competitive. If we let them, they would lower wages to nothing, pay in "company credit" good only at the highly profitable, highly marked up company store, lobby for bad laws that are entirely too favorable to them, and use our police, paid for by our taxes, to enforce those laws. Unions arose in defense against this sort of abuse. The workers saw that the corporations got their way through organized might that no individual could hope to match. They had to organize. For their part, many businesses are secretly glad of restraints that work. They're often unwise but not completely stupid, they know there are destructive forms of competition. It's a comfort to know they don't have to engage in some of that sort of competition because their competitors can't do it either. Some of their protesting is for form. A pity the free market extremists don't see that.

Businesses are like professional athletes who are so committed they'll do anything they can to win. Taking performance enhancing drugs would be the least of it. How about busting a competitor's knees? Bribing or threatening the officials, or the competition? Sabotaging facilities, or the competitors? Pretty easy to win if the competition's transportation couldn't get them to the game, or they all came down with the flu. Then there's changing the rules of the game. Suppose a team got a dubious rule passed that coincidentally bars most of an opposing team's players from playing, while disqualifying almost none of their own? Then later on rails against those same rules as examples of government red tape and interference, when they themselves were the ones who put those rules there? It's easier to bully governments into making changes if they've first been made to look stupid and incompetent. We have to have good rules and enforcement, unless you'd prefer chaos and seeing all the best athletes dead of stress, steroid abuse, and the myriad other hazards of the profession before age 30?

This dumping of polluted sites is classic. Mining operations pull that one all the time. They get to estimate how much pollution their operation will cause, because they wrote the laws on that. Naturally they underestimate as much as they can. For a few years they mine the material and rake in the profits. They shelter those profits, and then declare bankruptcy and leave us to clean up the massive mess they made. Of course the mess is ten times more expensive to clean up than they estimated, and because they planned to declare bankruptcy all along, they did nothing to mitigate the mess when it would have been cheaper.

They already are (1)

tkrotchko (124118) | more than 4 years ago | (#28997917)

"If we let them, they would lower wages to nothing"

That ship has sailed. All those jobs will be moved to China anyway. Paying a few billion to prop up GM is a drop in the bucket compared with the massive economic & political forces at work to ensure this happens.

After that, I suspect the unions will look for direct government subsidies without all the legal niceties of running the subsidies through the legal fiction of a car company called GM.

Re:Here is a Reason Why the Free Market Works Best (3, Informative)

mR.bRiGhTsId3 (1196765) | more than 4 years ago | (#28997919)

Unions are abysmal to. I'm going to buck a trend and go with an Airline analogy. Remember a few years ago when Delta went bankrupt. Its pilot's union had managed to finagle wages something like 3x the industry standard and absurd benefits. One of the first things Delta did in bankruptcy was to re-negotiate all those union contracts. It worked out pretty well, Delta returned to profitability in ~2 years if I remember correctly.
Unions are a necessary evil. They are needed to ensure that workers aren't run roughshod over. However, in cases where the Union gains too much power and uses it unwisely, they can destroy companies. Afterall, the purpose of unions is almost in direct opposition to the profitability of the company. Delta was my first example, they were almost certainly a contributing factor in the car companies downfall. Is there a reason that autoworkers should have their healthcare covered for the rest of the lives by a company funded health program? I can't think of a reason.
It doesn't really matter though, the unions have been rewarded with an automaker to do with as they please for their troubles, and its too late for any of us to do anything about it.

Re:Here is a Reason Why the Free Market Works Best (1)

Repossessed (1117929) | more than 4 years ago | (#28997645)

Because what we really want is a reapeat of the administration that causes wages to make a downward trend even as inflation spun out of control.

Re:Here is a Reason Why the Free Market Works Best (1)

mrlibertarian (1150979) | more than 4 years ago | (#28997873)

If GM had escaped from its union contracts through a bankruptcy...

Why should GM "escape" its union contracts through a bankruptcy?

Can't we just treat the union contracts as a liability? During the bankruptcy process, all we have to do is transfer the shares from the current shareholders to the creditors. If creditor A is owed $20 billion, creditor B is owed $30 billion, and creditor C is owed $40 billion, then give them 22%, 33%, and 44% of the shares, respectively. Anything that is owed to the unions (e.g. the net present value of every union member's pension) would be taken care of by this process, since the debts owed to the unions would be treated just like any other debt owed to a creditor.

Once this process is complete, there are NO liabilities left, by definition. The creditors are now the new shareholders. They elect their board of directors, and the directors try their best to make the new shareholders happy. Maybe that means liquidating the GM assets, maybe it means trying to keep the car company going. In either case, there are no union contracts that would need to be "escaped". Those contracts were with the original company, and that company no longer exists. That's not to say the liabilities demanded by those contracts are "forgotten" or "escaped"; rather, the liabilities between the original company and the unions would be considered to be "paid off" when the shares were transferred from GM to its creditors.

So, why does the government need to get involved? Why should the bankruptcy process be political?

Re:Here is a Reason Why the Free Market Works Best (-1, Flamebait)

Anonymous Coward | more than 4 years ago | (#28997277)

Kiss my fucking ass you Republican assclown. Fuck you and your "capitalism fixes everything" mental handicap. Here's a fucking hint, mouthbreather: capitalism got us into this mess.

Re:Here is a Reason Why the Free Market Works Best (-1)

Anonymous Coward | more than 4 years ago | (#28997499)

Wrong

Re:Here is a Reason Why the Free Market Works Best (0)

Anonymous Coward | more than 4 years ago | (#28997671)

How so? GM and Chrysler going under isn't a mess, it's what needed to happen.

Re:Here is a Reason Why the Free Market Works Best (0)

Anonymous Coward | more than 4 years ago | (#28997301)

We could have avoided all these problems if either Toyota or Renault had purchased the relevant bits of GM.

Newsflash: Get real. Nobody wanted to buy any part of GM as long as it came with the union contracts, pension liabilities, overbuilt factories, overextended dealer networks, environmental liabilities, etc. And whenever anyone suggested substantial cutbacks, Congress would swing into action to defend employment in their districts.

I think Obama's guys did pretty well here. Will the two new companies survive? Who knows. As they say on ESPN, that's why they play the games.

Re:Here is a Reason Why the Free Market Works Best (1)

MightyMartian (840721) | more than 4 years ago | (#28997941)

And the taxpayer will be on the hook for the cleanup. Yes, a wonderful deal had by all, well almost all.

I think the time has come to start making corporate officers and management personally libel, and then start seizing assets and tossing them in jail when things like environmental cleanup are evaded by the company. Wouldn't it be something to a former CEO sitting in a prison cell while every asset he owns is sold off to pay for the decisions that he made. It would be a victory for personal responsibility.

Re:Here is a Reason Why the Free Market Works Best (1, Insightful)

Anonymous Coward | more than 4 years ago | (#28997353)

LOL. Is this some game where we say the opposite of what is true? It's deregulation that allows the market to go nuts.

Re:Here is a Reason Why the Free Market Works Best (1)

Xylantiel (177496) | more than 4 years ago | (#28997393)

If General Motors (GM) were allowed to enter bankruptcy without a government bailout, then GM would likely have been purchased in whole, or in parts, by a European or Japanese auto company. The purchaser would have assumed all of GM's liabilities. Of course, the sale price would have been set to reflect the costs of these liabilities.

While it is fine to complain, this is living in a dream world. The whole point of bankruptcy is to shed liabilities because they CANNOT all be actually met. GM's parts would have been bought for less than pennies on the dollar (because everyone else is broke too) and that tiny amount would have been split up among its creditors -- effectively leaving them with nothing. This is the whole point of bankruptcy. This is to teach the creditors a lesson that they should pay more attention to what the company is doing before it goes down the toilet.

Instead of that certain disaster, we have what is a sort of experiment in government-assisted Union ownership. At worst it is a total flop and GM dies when the economy is not quite as bad as it was earlier this year and the blow is a little softer to the american domestic workforce.

Re:Here is a Reason Why the Free Market Works Best (2, Informative)

Anonymous Coward | more than 4 years ago | (#28997439)

However, because Americans allowed Washington (and Barack Hussein Obama) to effectively nationalize GM,

Sorry but when you specifically mention Obama in a comment like that makes it sound like he had some primary responsibility in the nationalization of GM. Before Obama ever came to power, the Bush administration had donated about $15 billion to GM, becoming a major shareholder. I think that the government would have ended up nationalizing GM no matter who was president.

That aside, I completely agree that the government should have let GM go bankrupt so that another automaker could have come in and purchase the company. That would have hopefully allowed GM to get out of their ridiculous contracts with the autoworkers union and they could have become a more efficiently run organization.

Re:Here is a Reason Why the Free Market Works Best (0)

Anonymous Coward | more than 4 years ago | (#28997459)

Not likely. I'm sure it would have been structured as a sale of assets and the liabilities would still be abandoned. Pension benefits would still be taken over by the government via the PBGC.

Re:Here is a Reason Why the Free Market Works Best (0)

Anonymous Coward | more than 4 years ago | (#28997483)

Tip One: If you want to be taken seriously, stop mentioning "Hussein" in your posts; it's a flag to anyone who isn't already on your side that your voice is not worth consideration.

Can you make your bias any more evident (2, Interesting)

dontmakemethink (1186169) | more than 4 years ago | (#28997611)

The profitability of the 'new' GM requires no explanation. $533M in environmental cleanup is a negligible expense by comparison to the value of the brands GM has developed globally. If the government was willing to buy out GM entirely, obviously they would be willing to absorb the clean-up costs to facilitate GM's survival under other ownership. The costs were inevitably going to fall on taxpayers no matter who bought GM, but only by buying out GM do taxpayers stand to get anything back. Anyone wishing a company that has employed millions of Americans through to retirement to be sold to a foreign corporation over some messy dump sites has a tainted sense of patriotism. Even critics of the Obama administration should praise them for keeping GM American.

And the term "Barack Hussein Obama" is the undisputed flag of politically bigoted. Please continue using it to openly declare your ignorance and irrational paranoia.

Re:Here is a Reason Why the Free Market Works Best (5, Insightful)

QuoteMstr (55051) | more than 4 years ago | (#28997627)

Barack Hussein

Thanks for letting me know when I could stop reading your post.

Re:Here is a Reason Why the Free Market Works Best (1)

night_flyer (453866) | more than 4 years ago | (#28997779)

so is he ashamed of his name again?

Re:Here is a Reason Why the Free Market Works Best (5, Insightful)

Daniel Dvorkin (106857) | more than 4 years ago | (#28997883)

so is he ashamed of his name again?

[sigh] Is John Sidney McCain III ashamed of his full name? If not, why didn't he use it in his campaign literature?

This wide-eyed, fake-innocent "but it's just his name" bullshit is really childish. You know perfectly well that the only reason to say "Barack Hussein Obama" in a regular political conversation is to make him sound more foreign, more menacing, more eeevil. Look, you don't like the guy, you don't like his policies, fine. There's plenty to criticize on that basis. But the Birther / Secret Muslim / Not One Of Us rhetoric accomplishes nothing except reveal much of the opposition to Obama as racist, religionist, xenophobic craziness.

Perhaps, but another reason (0, Troll)

tkrotchko (124118) | more than 4 years ago | (#28997939)

U.S. Presidents are routinely called by their full name, or at least their first & last plus initials

  George W Bush (an initial, but still)
  Dwight D Eisenhower (another initial)
  George Herbert Walker Bush
  William Jefferson Clinton
  Richard Milhouse Nixon

It's neither common nor uncommon to call presidents by their full name. I think you're just being sensitive, really.

Re:Here is a Reason Why the Free Market Works Best (2, Funny)

Daniel Dvorkin (106857) | more than 4 years ago | (#28997817)

Barack Hussein

Thanks for letting me know when I could stop reading your post.

Presumably GPP thinks John Sidney McCain III would have done better. ;)

Is this surprising? (3, Insightful)

tji (74570) | more than 4 years ago | (#28997077)

They declared bankruptcy.. the company failed and went into bankruptcy protection in an attempt to salvage something.

Their shareholders (owners) lost billions of dollars, and the GM of old is no more.

Yes, it's important to recognize the responsibilities of old-GM that are not being addressed now that they are gone. But, this should not be surprising, and it's not that unusual either.

Re:Is this surprising? (1)

arose (644256) | more than 4 years ago | (#28997247)

Their shareholders (owners) lost billions of dollars, and the GM of old is no more.

Of course, the company was never profitable, they never made anything, they will know better then run companies into the ground for short-term profits now...

Re:Is this surprising? (3, Informative)

nurb432 (527695) | more than 4 years ago | (#28997255)

Normally, when a company goes into bankruptcy, the assets are liquidated and the bondholders/etc get to split the cash. Sure there might not be much left to spread around, but its part of the process.

That didn't happen here, and i say it wasn't a true bankruptcy. Nor was Chryslers, with their assets being given to a foreign entity...

Re:Is this surprising? (2, Informative)

Anonymous Coward | more than 4 years ago | (#28997567)

Normally, when a company goes into bankruptcy, the assets are liquidated and the bondholders/etc get to split the cash.

That's Chapter 7 [slashdot.org] - liquidation. Chapter 7 bankruptcy is very rare. GM, like most corporations going through bankruptcy, is going through Chapter 11 [slashdot.org] - restructuring. That's where the Judge makes the company pay off as much of the debt as it can, cancels the remaining debt, and compensates the creditors with stock in the new company. The theory behind it being that the restructured company will be worth more to the creditors and the public at large than selling the parts off at a fire sale.

Re:Is this surprising? (0)

Anonymous Coward | more than 4 years ago | (#28997279)

But how else will the free market fanbois get a good rant in?

Re:Is this surprising? (1)

Dustie (1253268) | more than 4 years ago | (#28997427)

The earth (pollution) should come before investors. Then investors would also see a need to push the company to pollute less.

Re:Is this surprising? (0)

Anonymous Coward | more than 4 years ago | (#28997477)

It did.. The investors don't get squat. The shares of old-GM are gone, investors lost everything.

Maybe you mean debtors. They are owed something in the bankruptcy process as assets are liquidated the debtors are re-payed, at least partially.

The breakdown between how much should ho to debtors (e.g. parts suppliers) vs. cleanup funds is certainly debatable.

going out of business sale (0)

Anonymous Coward | more than 4 years ago | (#28997083)

come one come all, everything must go! pretty soon the only thing left inside the usa will be weapons and software and not the software i will let on my PC because it comes from a convicted monopolist in Redmond Wa.

unusual not (4, Insightful)

confused one (671304) | more than 4 years ago | (#28997085)

While the bankrupcy itself was unusual, it's not unusual at all for corporations to receive relief on environmental cleanup and associated fines during bankruptcy. State and Federal governments ends up with the tab for the cleanup.

GM is just another government agency (2, Insightful)

nurb432 (527695) | more than 4 years ago | (#28997239)

And since when does the federal government own up to things?

Re:GM is just another government agency (0, Offtopic)

larry bagina (561269) | more than 4 years ago | (#28997285)

I'm sure they will once they in control 100% of healthcare rather than just 50% of it.

ha ha (0)

Anonymous Coward | more than 4 years ago | (#28997343)

welcome to life in the Third World, muhfukkas!

Enforce this time (1)

kmahan (80459) | more than 4 years ago | (#28997395)

Hopefully the EPA will not let GM slide this time around. Mandatory vigorous enforcement at all their current sites. So that when GM declares bankruptcy again they won't be leaving as big a mess.

Rational expectations (2, Insightful)

QuoteMstr (55051) | more than 4 years ago | (#28997673)

The fundamental basis of Chicago economics (which we've been using for the past 40 years) is that people and thus businesses are rational actors and make decisions that are best for their own interests.

That's pernicious fucking bullshit. People and companies make irrational decisions all the time. Consider the EPA cleanup mess: according to the idea of rational expectations, the prospect of having to pay for an EPA cleanup would be a strong deterrent to polluting. In reality, nobody cares, because the person who decides whether to pollute will be gone by the time the consequences of a decision to pollute become apparent. Thus, the company as a whole makes a rather irrational decision to pollute regardless.

You need proactive enforcement to stop these kinds of violations. Generally, trying t stop a given behavior by threatening companies (or people) with consequences over a time horizon of a few years is completely ineffective in stopping that behavior.

"GM" (0)

Anonymous Coward | more than 4 years ago | (#28997907)

From Wikipedia's General Motors:
Owner(s): United States Treasury (61%) Government of Canada/Ontario (11.7%) United Auto Workers (17.5%)

Lesson: industry can ultimately escape enviros by failing into the arms of government and its labor/union constituents.

Today only federal level politicians can still trump enviros in the US; everyone else has to move to China.

Add it to Superfund (3, Insightful)

bryan1945 (301828) | more than 4 years ago | (#28997927)

Or whatever it's called.The US people are now completely crispy fried when it comes to our debt. At this point I just laugh and cry a little every time I hear about a new 'program' or 'bill' or 'solution' that comes out of the administration's or Congress's mouth.

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