06/01/2009 08:59 am ET Updated Dec 06, 2017

GM Bankruptcy: "Hope" Resurrected as Official Slogan

GM has finally filed for bankruptcy. We've been talking about it for so long that you might think the actual event is anti-climatic -- it's not. It's historic, it's depressing and frankly, I'm sick of all of the nasty e-mails I've been receiving about how "nobody is suffering but me and my constituency!" Can't we agree that this is a bad chapter that must close and that the collateral damage is immense?

There are some winners and losers, as I discussed on the Saturday Early Show, but I think net-net, the losers far outweigh the winners.

The next phase has now begun. What lies ahead is unknown, but there may be some clues in "The Obama Administration Auto Restructuring Initiative." The government lays out the ownership structure, which we already knew. It also outlines the "Principles for Managing Ownership Stake". This is the part that has some interesting tidbits.
  • The government has no desire to own equity stakes in companies any longer than necessary, and will seek to dispose of its ownership interests as soon as practicable.
  • The government will not interfere with or exert control over day-to-day company operations. No government employees will serve on the boards or be employed by these companies
  • As a common shareholder, the government will only vote on core governance issues, including the selection of a company's board of directors and major corporate events or transactions.
In essence, the government is relying on GM professionals to navigate the company through bankruptcy and to guide the company to profitability when it emerges from bankruptcy. I'm keeping my fingers crossed for everyone, but I fear that this is a bet based on the Obama theme of "Hope" as much as anything else.

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