Friends: I’m taking a blogging break during the holidays and am re-running some blasts from the past.
I was ironing clothes and happened to catch an episode of Meet the Press. The topic: bailing out the auto industry.
Paul Ingrassia, Pulitzer Prize winner, former Detroit Bureau Chief for the Wall Street Journal, and contributing editor for Conde Nast Portfolio, commented to Tom Brokaw:
We hear a lot about hybrid cars, Tom. I think What the auto industry needs is ‘hybrid bankruptcy.’ Or if that word is toxic, let’s call it ‘hybrid restructuring.’
I was so fascinated by the euphemism “hybrid restructuring” that I forgot to pay attention to Ingrassia’s definition of the term.
I went back and watched the video, which didn’t enlighten me much.
At its core, Hybrid restructuring (the term bankruptcy makes us feel uncomfortable), means that the U.S. auto industry needs to become less bureaucratic. Okay…why didn’t he just say that, in plain English?
Economist.com elaborates on hybrid bankruptcy:
…Is there any bankruptcy structure that would allow one or more of the firms to go under without there being intolerable effects on financial markets and the real economy?
Economist.com terms it bankruptcy lite:
…The government would make available $25 billion in financing… And, as in a normal bankruptcy, existing creditors would get heavily reduced payments (say, 30 or 40 cents on every dollar owed) along with equity. The creditors would take a hit, but they’d also have a chance to make back that money–and perhaps earn some more–if the companies rebound and stock prices rise.
There you have it. Hybrid restructuring. What does that phrase evoke for you?