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Is Mercury Dripping through Bankruptcy Cracks?

How the law, money and politics conspire against a cleanup.

by on Sep.24, 2009

As always, the question is who pays for old environmental sins.

As always, the question is who pays for old environmental sins.

Environmental groups are calling on the Obama Administration or Congress to direct General Motors Company to adhere to a contract signed by the old GM requiring it to pay for the removal and disposal of mercury switches from GM vehicles headed for the scrap yard.

Given the criticism the Administration is taking over the unpopular auto bailouts, it is unlikely that it will interfere in bankruptcy law, so another solution must be pursued.

A spokesperson for Motors Liquidation Company – the legal name of the old bankrupt GM that is being liquidated – told The Detroit Bureau that it “is carefully analyzing about half-a-million contracts of the former General Motors Corp. This agreement is among them. Ultimately, any decision made on any contract will be consistent with our obligations under the bankruptcy code.”

Translation: there is no legal reason to continue the contract, so GM will not.

The problem is a serious one that will not go away anytime soon.

Follow The Money!

Follow The Money!

Mercury switches were used to operate hood and trunk lights in virtually all U.S. made vehicles before 2004, when automakers, under increasing pressure from environmental groups and states, finally stopped their use.