If there’s no bailout from the government, of course. Sounds like classic tactics to scare Congress (and the American people) into bailing out the companies quickly to me. Amazing how this news just happens to get leaked to the press.

Top leaders of the United Auto Workers union are telling some of its officials that General Motors may need to file for Chapter 11 bankruptcy protection before Christmas if the auto maker fails to win government funding in coming days, people familiar with the matter said Tuesday…

“We do not believe that a Chapter 11 filing is a viable option, nor does it answer the current liquidity issues, which have been brought on by the collapse of the financial markets and consumer confidence issues,” GM spokesman Tony Cervone said Tuesday.

Why not? I keep hearing that Chapter 11 bankruptcy is out of the question but I hear very few reasons as to why. Many a company has gone through Chapter 11 — a reorganization instead of complete closure — and come out better.

It’s not so much that bankruptcy isn’t a viable option, it’s that the unions and executives would rather get bailed out by the American taxpayer.