Was the federal government wise to bail out General Motors, or should GM have been left to face the force of the market and the decisions of the Chapter 11 bankruptcy judge?
General Motors, in 2009, was forced to enter Chapter 11 bankruptcy as part of a federal government-directed, prepackaged bailout of the failing firm. GM had gone from being one of the most prominent corporations in the world to a sprawling, dysfunctional failure. GM reported $ 82.29 billion in assets and $ 172.81 billion in debts. The federal government put $ 49.5 billion into the bailout and took a 60 percent equity stake in the new General Motors, although the company retained control of its day-to-day affairs.