General Motors is on the heals of a possible multi-billion dollar bailout.  This comes as GM shares dropped 30% in value at the close of business Monday on Wall Street. 

Today Deutsche Bank has lowered GM’s equity to zero.  This all hinges upon last Friday’s announcement that General Motors lost more than two billion dollars and sales tanked again. 

“We are in a global recession, there’s no doubt about it,” said Dr. Timothy Nash of Northwood University.  He specializes in economics. 

“General Motors has to, in my opinion, dramatically restructure,” he said.  While the debate continues over restructuring, so does that of a bailout- which could be in the tens of billions. 

General Motors posted $2.5 billion dollars in losses Friday in the third quarter.  Sales dropped 45%.  GM has $16 billion dollars in cash on hand.  They blew through $6.9 billion dollars in the last quarter alone.

“It is important to insure that the auto industry survives,” said Governor Jennifer Granholm on MSNBC last Friday.  “There is no way you are going to see the industry fail without seeing significant ramifications across the country,” Granholm said. 

Not everyone says a bailout is a good idea.  Michael Le Faive is an economist with the Mackinac Center for Public Policy in Midland. 

“When the government steps in at this point, we not only pay the high cost of the Big Three through our consumption dollars when we buy cars, but now we’re placed on the hook, to subsidize the bad decisions and pay for the, say, health care of these private companies,” he said.

Le Faive too, said restructuring is inevitable. 

"No business should be too big to fail.  If they reach that size, they are going to start making important decisions, because they know that the government will provide a safety net to pick them back up when they make bad decisions,” he said.