Obama and his minions spinning away on the Chrysler bankrubptcy amazed me.
The bottom line is the Money managers who held the secured senior debt of Chrysler are in fact the firs in line to be paid and in all likelihood recover more of their investor’s money by forcing a liquidation of assets than the 20 cents an a dollar deal offered by the Obama administration
The administration and the lame stream media are trying to paint this as greedy wall street guru’s when in fact these managers are just trying to protect their client investors which by law they have to. Allowing the unsecured debt holders in this case the UAW to be paid off first and then getting to the secured bondholders is completely upside-down.
In other words Obama favored the union hacks of the UAW at the expense of the secured bondholders. Shoot the only reason most of the banks went along with the travesty of the Obama plan was because they took the TARP money and are being told what to do by the administration.
I worked for Chrysler for 15 months in 02 and 03 as a maintenance supervisor at the Warren truck assembly plant also known as Dodge City. I could right a book and the malfeasance and abject laziness of both the UAW work force and the absolute poor management and leadership exhibited by my superiors. If you saw what was actually being done day by day, plus the job pool, the lack of spares and other issues you would be amazed that we built any Rams and Dakota’s at all. On the one side I laughed and smiled when Chrysler went down the tubes because of what I had experienced, what is a shame is what will happen to some of the fine men I had on my crew who did not fit the stereotypical auto union mentality and work ethic and did a great job for me and the company day by day. Unfortunately the bad deals worked out over the years by management and the UAW couple with a poor product line crippled all of the big three, there is know way for Chrysler to survive with the built in legacy costs. A real chapter 11 process will allow them to shed all of this and whatever is left can be organized into a new company. Some will say this is not fair but nothing in life is guaranteed. Only the current administration can seriously think that pouring billions of more dollars into this endless black hole is a good thing. But Obama knows he owes his election to these unions and he is trying to use we the peoples money to bail them out of a situation that the UAW helped foster and create.
If the administration plan had been allowed to go forward with the union getting majority control and the bondholders getting shafted the likelihood going forward of companies that are unionized getting secured bondholder financing in the future would be non existent..