GM Hoping for Speedy Sale, Exit from Chapter 11

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WASHINGTON -- At a Union Hall in Lansing, Mich., three generations of Greens watched an announcement many Americans still can't believe.

"I don't think it's the end of an era, it may be the end of a one chapter at GM," said Mike Green, president of UAW Local 652.

General Motors is now owned by the federal government.

"What I have no interest in doing is running GM," President Obama said.

It's unchartered territory.

With a 60 percent stake in the company, the federal government is much more than a bystander.

The company has already been instructed to replace most of its board members in consultation with the Obama administration.

And GM's CEO predicts federal ownership will last for years.

"I want to be honest with you. Building a leaner GM will come at a cost. It will take a painful toll on many Americans," Obama said.

At least 11 plants are being shut down, 29,000 employees will be laid off, and 2,600 dealers will be closed.

"I never thought this would happen.  We were made significant promises all those years," said John Morris, a retired GM employee.

GM is expected to emerge from bankruptcy in a few months.

It's successful brands will be transferred to a new company. Less successful ones will be sold. The company already has a buyer for Hummer.

While major bondholders ended up with a 10 percent stake in GM, private investors were left out.

"If you're an investor who owns shares of stock in other companies that are in trouble you're encouraged to sell now because you're afraid government might end up getting involved later on," said Dan Gainor with the Business and Media Institute.

Some are now questioning the legality of the President's GM takeover in the first place.

The White House is certainly aware of the political implications if GM doesn't recover, given the American auto industry's presence in battleground states like Indiana, Ohio, Michigan and Missouri.

But for thousands of ordinary Americans, the stakes are even higher.

"My job or future career hinges on how GM comes out of this," GM employee Rollin Green said.
So does the return taxpayers can expect on their $50 billion investment.

The administration has already warned that $2 out of every $5 injected into GM may never be recovered.


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CBN News
Jennifer Wishon

Jennifer Wishon

CBN News White House Correspondent

Jennifer Wishon is the White House correspondent for CBN News based in the network’s Washington, D.C. Bureau.  Before taking over the White House beat, Jennifer covered Capitol Hill and other national news, from the economy to the 2010 oil spill in the Gulf of Mexico. Follow Jennifer on Twitter @JenniferWishon and "like" her at