Dems balk on plant closings

[30ashopper]

This is an interesting story in special interests in Washington. Last fall, reps promoted the idea of bankruptcy as being the best option for GM and Chrysler, at the time however dems balked, and pushed for more subsidies. Down the road (no pun intended), after much taxpayer money was gifted (about 20 billion), the Obama administration came to conclusion that reps were right and agreed that bankruptcy was the right answer. (While also promising additional billions in funding and gift ownership to the unions, on top of the funding dems had already delivered.) Now apparently some Democrat leaders in Congress are feeling just a little hesitant due to dealership closings in their districts. For example -

Dear President Obama:

We are writing to express our concerns about General Motors? and Chrysler?s decision to close profitable automobile dealerships across the country, and urge you to ask GM and Chrysler to delay final action on proposed closures pending further review of the decision to consolidate dealerships and the process by which Chrysler and GM selected the dealerships to close.

..

POLITICO 44 | A Living Diary of the Obama Presidency

I applaud the Obama administration for finally coming to its senses, but I wonder if Congress will ultimately undo what's necessary in order to gain votes? Should we let the natural process of bankruptcy continue and let both GM and Chrysler reorganize into smaller, and possibly profitable entities? Or should we cling to the notion that these companies can compete in a global market as they once were? The people we vote for are making these decisions, right now, today, on our behalf.

 

[Lynnie]

I am for BK. I am not for Government Motors, Inc.

Someone was for it before he/she was agin it.........agin! Hopefully, Congress will recognize that this nation runs on free enterprise.

 

[30ashopper]

I am for BK. I am not for Government Motors, Inc.

Someone was for it before he/she was agin it.........agin! Hopefully, Congress will recognize that this nation runs on free enterprise.

It is Government Motors, we collectively own like 70% I think. The union owns around 16%, and the original bond holders have the rest. Common stock holders were wiped out.

GM: Summary for - Yahoo! Finance

^^ That's not something you see every day.

 

[Lynnie]

Bond holders are subordinate to UAW!

Makes no sense at all!

 

[Will B]

Bond holders are subordinate to UAW!

Makes no sense at all!

That's because the Obama administration somehow allowed them to totally circumvent normal BK proceedings. How many BK's can you think of that were not assigned a judge to oversee the process? The secured creditors got screwed. Now, that begs a question...

Knowing that the government could come in at any time and decide without input of the courts that secured creditors get nothing, how many do you really think are out there that will invest money or loan money in the "new" GM?

My guess? Not many. By doing this, the government may have helped one group, but ultimately may have made it harder for GM down the road to get any kind of capital.

 

[tsutcli]

I knew it wouldn't take congress long to try and micromanage things ( questioning why and by what process dealerships were chosen for closing and what kinds of cars to build and where ) instead of allowing people in the industry set priorities. Barney Frank has already intervened to keep a parts facility from closing in his district. Between the gov't idiots who are toades for the unions I would guess that any hard decisions will be avoided and you and I will be stuck carrying an over-bloated auto industry that still won't be able to sell cars. Remember the gov't never has had to show a profit and are the last ones to voluntarily give up control and power. What makes anyone think this leopard will change its spots? It's "CONGRESS" who are the problem people - never the solution.

 

[scooterbug44]

Dealerships closing are small potatoes compared to plants closing IMO. One of the communities we played sports against had a plant close and the community was at over 20% unemployment during a good economy.

Was UAW allowed to keep stock to fund pensions? That is the only possible reason I can think of.

One again it sounds like a good idea got circumvented because everybody had to get their special interest.

 

[Andy A]

I am patienty awaiting a defense of this situation by someone, if there is any.

 

[Yarmap]

High court blocks Chrysler sale to Fiat

 

[tsutcli]

Ruth Bader Ginsburg of all people put a stay on the bankruptcy deal between Chrysler and Fiat when presented with the data that the union was put far ahead of secured creditors and stock holders in the deal. A total aborgation of contract law and bankruptcy proceedings which threatens the basic rights which made America great. They're making up the law as they go to suit their purposes - Big Gov't control of your lives.
Congress has gotten totally out of control and power mad in such a short period of time, it's scary where it could wind up. Is this the "Change you can believe in" you bargained for? Be wary of people who govern according to the principle of fear. Hasty, unreviewed actions have many unintended consequences which are worse than the original problem.
SLOW DOWN!!!!!!!!!!!