Bailout? Bankruptcy?

I haven't spent a lot of time thinking about the auto bailout, other than to quake with fear if something isn't done. Kevin at MoJo has a good summary to his post on the subject today:

This is the "prepackaged bankruptcy" option that's been mooted a few times before. It actually sounds like a decent compromise to me: it keeps the companies from imploding in the middle of a huge recession, but at the same time it gives a bankruptcy court considerable leeway to impose serious restructuring of the kind that a political process probably can't. The end result — if it's done right — is a pair of companies that will end up smaller but still viable in the long term, and an economy that takes only a moderate hit instead of a killing blow. Call me tentatively in favor of this approach.

Thus far, it seems the most sensible suggestion.