GM filed for bankruptcy, just as everyone expected, and revealed to the world that it owes $173 billion to creditors, but has less than half that in assets. That's a huge sum, even considering that we've become used to large sums. Numbers like $50 billion might not cause us to bat eyelashes anymore, but figures in the hundreds of billions are still impressive. It's useful to remember, though, that at the time of its bankruptcy, Lehman Brothers owed $613 billion, and had counterparties strewn across the world. The GM bankruptcy is, in a way, simpler. 

Also, as Bloomberg notes, General Motors "once mattered so much to the U.S. economy that a two-month strike in 1970 helped trigger a 4.2 percent drop in gross domestic product for the fourth quarter." Today, GM is largely "irrelevant" in terms of its consequences on the broader economy, or at least that's what Moodys.com economist Mark Zandi told Bloomberg.

Nonetheless, the company's bankruptcy has a huge psychic impact, and perceptions matter. That's why the White House is calling the shots here. Obama's plan is to split the company into basically a "bad GM" and a "good GM." The creditors get the bad GM, while the federal government and the employees' union will together own 90 percent of the good GM. Creditors will get the other 10 percent, and receive warrants to buy another 15 percent of the company if (and it's a significant "if") the new GM reaches $30 billion in market capitalization, a level that the old, intact company hasn't seen since 2004.

The Obama administration wants this to be a quick procedure, and the signs are good that that will be the case. Chrysler, which declared bankruptcy on May 1, has gone through an astonishingly quick court process, and may emerge from protection as early as this week. The key sticking point with GM is getting enough creditors to agree to the White House's proposal. As of late last week only about a third had been convinced.