Chapter 11 for the Big Three?
As the continuing recent economic decline begins to move out of the financial sector and into the other main sectors of the economy, the question has begun to be raised whether we should "bail out" the Big Three automakers or let them fall into Chapter 11. The traditional remedy in these cases is certainly the Chapter 11, which was designed for situations like this. However, recent policy arguments have been raised that without government intervention into these broad sectors the entire economy will collapse. But what will happen if the Government's credit rating drops below AAA, and the United States itself begins to suffer from the economic malaise? One has to wonder how this would restore confidence in the economy as a whole. Redistributing the problem may have little to any impact. Bankruptcy may in the end prove the most viable solution. It would also force the domestic car manufacturers to improve their product line.
