Kinabalu

Wall Street Breakfast: Must-Know News

You may be right, and I agree, in the event no significant expense restructuring can be achieved, Congress should not provide any liquidity, and the solution should be Chapter 11.

On Nov 29 03:46 PM LobsterM wrote:

> Kinabalu,
> Don't expect the UAW to agree on anything. That's their nature.
>
> Even if they (both) meet half way, it's still a giant burden to the
> gov
> and taxpayers. Still a giant Black Hole. The best solution will be
> Chp.11. That way will leave them no option but to negotiate. Right
> now, UAW still
> think they are the king as they used to for half a century.

Wall Street Breakfast: Must-Know News

The UAW should understand that the only chance for their members to receive a full pension benefit, not to mention continued employment, is a healthy company. GM should be negotiating heavily for substantial adjustments to the union contract, and should offer explicit restrictions on executive compensation in exchange. The deregulation of the airline industry in 1979, and the subsequent 5 year adjustment period, offers a great model for how both sides should proceed.

If these negotiations are not succcessful the most likely alternative is Chapter 11, which will absolutely result in adjustments to the Union contract and to executive deferred compensation arrangements. Congress will dilly-dally because of the political pressure but will ultimately do the right thing and not provide any bail-out funds unless Union and Management meet halfway.

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