General Motors, which received $13.4 Billion in taxpayer's funds a few months ago, needs at least $5 Billion more to keep operating past March.
GM needs to file a plan with the Treasury by Tuesday, and its options are to get more money from taxpayers or go through a government-backed bankruptcy reorganization process. Chrysler went through a structured bankruptcy-type process back in 1980.
Bankruptcy does not mean that the company shuts down -- it allows the company to renegotiate contracts (such as those with unions, lenders, and dealers) in order to come up with a viable structure.
GM has not been able to get concessions from the UAW and bondholders in order to improve their financial situation. Talks with the UAW broke down last night. GM owes $47 Billion in retiree health care benefits -- union leaders are hoping that the US government (taxpayers) will take responsibility for part of these payments.
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