Government to own 50% of GM?

Private Property. This is one of the founding principles of Western civilization and capitalism. If you borrow someone's private property, you have to pay it back (It's not optional). GM has borrowed $27 billion from its bondholders. If GM cannot repay these debts on time with interest, then according to all the laws of this country and 1,000 years of common-law tradition, GM's assets are legally transferred from the company's equity investors to the bondholders through bankruptcy. Those are the rules (equity is what is "left over" after all other claims have been satisfied). However this Administration does not seem to want to play by the rules.

The U.S. government is demanding a 50% equity stake in the restructured GM. On what basis, you might ask? True, they have put $15 billion into the company, but only after GM should have filed for bankruptcy. In other words, without the government's "help," the bondholders would have gotten 100% of the new company. Now, even though the bondholders (you, me, our pension plans) are still owed $27 billion (almost twice what the government is owed), they (we) are being asked to accept only 10% of the equity in the new GM. So the government get's 50% and the unions get 39%; while the company's legitimate creditor's receive 10%. How fair is that?

Capitalism doesn't work when debts aren't repaid. Capitalism doesn't work when legitimate creditors are put last in line – behind the government and the union. What impact do you think this will have on lenders? Would you be willing to lend money to a company, knowing that the government may come in, disregard your rightful claims and steal your money?