Freedom of BLEEP

Now the Obama administration is allegedly issuing threats to anyone that stands in their way. Hedge fund managers are challenging the administration’s bankruptcy plan for Chrysler and negotiations have been somewhat hostile. A leading bankruptcy attorney said his client “was directly threatened by the White House and in essence compelled to withdraw its opposition to the deal under threat that the full force of the White House press corps would destroy its reputation if it continued to fight.”

Is this any surprise? Obama did the same thing during his campaign. Remember the “truth squads” of policemen and prosecutors?

And despite the White House denial that such threats were made, they have already begun attempts to soil the reputation of the hedge fund managers. The Obama administration and other Democrats have been calling them vultures and greedy speculators. Obama even blamed them for Chrysler’s bankruptcy!

Those of us that live on earth know that those hedge fund managers lent Chrysler money when no else would. They took a risk and the money grubbing union workers got to keep their jobs for a while longer. As it turns out, you can’t have $3,000 of legacy union prices on every car and expect to be profitable. Poor management and unreasonable unions are responsible for the job loss. But Obama says the investors are to blame.

So what’s the big deal about Obama’s Chrysler bankruptcy plan? In the proceedings, the Obama administration has decided that the union will be paid off prior to those who held secured investments in the company. This means the UAW gets more than what their shares are worth and the investors get less. This preferential treatment has resulted in the UAW getting 55% of the company, while secured lenders received only 29 cents on the dollar for debt they hold.

But if SECURED lenders are not paid first - as standard legal practice usually ensures, then who in their right mind would ever invest in American companies again? And just think where these companies would be today without investors…

The Obama Power Grab, Part IV

The Associated Press reports that “General Motors Chairman and CEO Rick Wagoner will step down immediately at the request of the White House.”

Perhaps Wagoner should have stepped down long ago. But the problem is that this sets a terrible precedent. Since when does the President have such authority over a publicly traded company? Why don’t the other creditors and shareholders have a say?

While the executives at GM have consistently underperformed, it’s the labor union that really drove this company into the ground. Obama even cited the lack of union concessions as a primary fault with GM’s restructuring plan. It’s the union leaders that control this! Yet the CEO was made his scapegoat, and this is only one facet of Obama’s anti-business repertoire.

Just last week, Obama and other democrats were calling for executive salary capping - of all publicly traded companies. Do they not understand the implications of this policy? The best executives will leave the US for higher paying jobs, thus strengthening foreign companies. We’ll be stuck with mediocre leftovers. Read any book on corporate philosophy and it will tell you the same thing: a great company has a great CEO behind it.

This week Barney Frank is proposing government control over all employee salaries, not just top executives. It looks like the government may soon determine our wages.

Obama’s power grab doesn’t stop there. He also wants the government to be able to seize any financial institution. This isn’t limited to banks. This isn’t limited to institutions that have received government bailout money. Any financial institution will be subject to seizure, basically at the whim of Washington officials. This could represent the largest permanent expansion of government regulatory power in the history of the US.

Every day Obama becomes less like FDR and more like Hugo Chavez.