... [President]Obama’s first 100 days have occasioned a number of dispiriting moments, but yesterday’s attack on Chrysler’s bondholders represented a new low.Instapundit:
In a speech announcing the company’s bankruptcy filing, President Obama blasted “a group of investment firms and hedge funds [that] decided to hold out for the prospect of an unjustified taxpayer-funded bailout.”
That is nothing short of a lie. The consortium wasn’t holding out for a bailout. It was holding out for a bankruptcy. (bold added)
The administration tried desperately to keep Chrysler out of bankruptcy court; in the process, it demonstrated exactly why that institution is so valuable. Obama’s auto task force attempted to browbeat Chrysler’s creditors into taking a terrible deal in order to spare the United Auto Workers union as much pain as possible.
The large banks, which owe their continued existence to the $700 billion Troubled Asset Relief Program (TARP), caved and agreed to take a massive haircut on their secured Chrysler debt. But a group of smaller firms, calling themselves “The Committee of Chrysler Non-TARP lenders,” refused to play ball.
In a statement released yesterday, the firms pointed out that they would be shirking their fiduciary duty to their investors if they did not hold out for the best possible deal. For them, the best deal is bankruptcy. In bankruptcy court, secured debt holders take priority over other creditors. The administration’s plan called for secured lenders to get in line behind the UAW.
For resisting this expropriation and following the law, the non-TARP lenders were publicly denounced as vicious Benedict Arnolds by a sitting American president.…
WHITE HOUSE THUGGERY: A transcript of the key bit from bankruptcy lawyer Tom Lauria’s radio interview.If you have a minute, follow this link to Johnny Dollar’s Place and listen to his interview with Fox News reporter Major Garrett.
UPDATE: This passage strikes me:One of my clients was directly threatened by the White House and in essence compelled to withdraw its opposition to the deal under the threat that the full force of the White House Press Corps would destroy its reputation if it continued to fight.How does the supposedly independent White House Press Corps feel to know that it’s being wielded as a weapon by Obama’s operatives? Might it at least be interested in looking into these allegations?
While Reuters is delighted with Obama, I think he’s out of control. When was the last time a POTUS had a public temper tantrum like this?
Update: White House deputy press secretary Bill Burton is now saying there's no evidence of a threat such as attorney Tom Lauria has stated. The denial's here along with some skeptical commentary about it.