What happened
The Obama administration is sending General Motors into bankruptcy protection under a plan to shrink the struggling industrial giant to make it profitable again. The federal government will invest another $30 billion in GM—bringing taxpayers' commitment to $50 billion—and 60 percent of the new GM will be owned by the United States. (The Washington Post)
What the commentators said
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"Rarely has a company fallen so far and so fast as General Motors," said Micheline Maynard in The New York Times. GM's family sedans and muscle cars were once "rolling displays of American DNA," but the company "lost its feel for reading the American car market it helped create." The bankruptcy wasn't unexpected, but it's still a "staggering blow."
Not as staggering—or "humbling"—as the only "realistic alternative," said Andrew Leonard in Salon. If President Obama and GM hadn't chosen this route, the company would have faced a "catastrophic liquidation," which would have delivered "another debilitating blow to an already tottering economy." Still, to call the bankruptcy move a risky bet is a huge understatement.
"The Obama Treasury is portraying this as the best solution to the mess it inherited," said The Wall Street Journal in an editorial, "leaving GM with much-reduced legacy costs for health care," a "humbler" autoworkers union, "and a more efficient dealer network and product line." But the GM bailout will only pay off for taxpayers if GM executives make decisions based "solely on business judgment," and with the government involved "nonpolitical management will be impossible."
