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    Case Study1 (GM Bailout)

    Uploaded by

    Mae Tomelden
    The document discusses the GM bailout from different philosophical perspectives. From a utilitarian view, the bailout had more benefits than costs by saving jobs and tax revenue. From a caring perspective, it prevented bankruptcy and benefited all parties involved. However, some thinkers' theories were not fully aligned with the government taking a 61% ownership stake. While Marx would approve, Locke and Smith's theories emphasize private property and limiting government interference. The best solution suggested is a Chapter 11 bankruptcy reorganization that allows GM to restructure its debts while continuing operations.

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    Case Study1 (GM Bailout)

    Uploaded by

    Mae Tomelden
    169 views2 pages
    The document discusses the GM bailout from different philosophical perspectives. From a utilitarian view, the bailout had more benefits than costs by saving jobs and tax revenue. From a caring perspective, it prevented bankruptcy and benefited all parties involved. However, some thinkers' theories were not fully aligned with the government taking a 61% ownership stake. While Marx would approve, Locke and Smith's theories emphasize private property and limiting government interference. The best solution suggested is a Chapter 11 bankruptcy reorganization that allows GM to restructure its debts while continuing operations.

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    The document discusses the GM bailout from different philosophical perspectives. From a utilitarian view, the bailout had more benefits than costs by saving jobs and tax revenue. From a caring perspective, it prevented bankruptcy and benefited all parties involved. However, some thinkers' theories were not fully aligned with the government taking a 61% ownership stake. While Marx would approve, Locke and Smith's theories emphasize private property and limiting government interference. The best solution suggested is a Chapter 11 bankruptcy reorganization that allows GM to restructure its debts while continuing operations.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    169 views2 pages

    Case Study1 (GM Bailout)

    Uploaded by

    Mae Tomelden
    The document discusses the GM bailout from different philosophical perspectives. From a utilitarian view, the bailout had more benefits than costs by saving jobs and tax revenue. From a caring perspective, it prevented bankruptcy and benefited all parties involved. However, some thinkers' theories were not fully aligned with the government taking a 61% ownership stake. While Marx would approve, Locke and Smith's theories emphasize private property and limiting government interference. The best solution suggested is a Chapter 11 bankruptcy reorganization that allows GM to restructure its debts while continuing operations.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    1. In your view, should the GM bailout have been done?

    Explain why or why not using


    the ideas of the various thinkers discussed in this chapter.

    Looking at this situation from a utilitarian point of view, this means that it's all
    about costs vs. benefits. The GM bailout certainly had more advantages, for example
    creating jobs to save the economy from more damage than it already had. Human capital
    was also used by it. The cost of the bailout was mostly only losing cash, but it allowed
    the government to tax more income to pay off this debt by providing more jobs.

    Bailout is ethical from a caring perspective because it prevents GM from


    bankruptcy. All parties involved with GM would benefit from it. Such as more fields of
    work that favor society, and the government where tax is collected from the salary of the
    employee.

    2. In your judgment, was it good or bad for the government to take ownership of 61
    percent of GM? Explain why or why not in terms of the theories of Locke, Smith,
    and Marx.

    I think it's better for the government to take 61 percent of GM, allowing the
    government take over the business most. Through government interference, free market
    monopoly may be prevented, ensuring the government retains a high degree of market
    regulator. The government is also financially supporting the company, and because it was
    the government, the financing may be more stable rather than held by a certain company
    or public. As to Lock, Smith, and Marx's theories, the fact that the U.S. Government
    owns 61 percent of GM shares which violates the theory of Locke. Locke would say that
    the right to property is violated because it was stripped away from the investors by the
    government. In its theory, the right to property is essential. But Smith will again disagree
    with the fact that 61 percent of GM 's shares are held by the U.S. government.
    Governments should not interfere in economic systems, nor should they own any part of
    a company. But then, Marx would approve of that, but he'd rather see the government
    own 100 percent of the shares. Marx believes that property should belong to the public
    rather than to the private few. As 10 percent of the shares are now left to the old owners,
    Marx will see this as the bourgeoisie 's oppression of the proletarians.

    3. What possible solution/s can you suggest for this case? Expound your answer.

    We believe that the only viable option will be a Chapter 11 bankruptcy filing for
    GM. What is Chapter 11? Chapter 11 is a form of bankruptcy that involves a
    reorganization of a debtor’s business affairs, debts, and assets, and for that reason is
    known as "reorganization" bankruptcy (Chapter 11, 2020).

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