Thursday, May 14, 2009

Quote of the Day

George Will on the Obama administration: "The administration's central activity -- the political allocation of wealth and opportunity -- is not merely susceptible to corruption, it is corruption."

True.
Posted by at
Labels: ,

2 comments:

Anonymous said...

George Will has his feathers ruffled over nothing, and so do you. That the unions will end up with more equity than the creditors as result of the Chrysler pact is true. But the government is not denying any of the creditor’s rights. In fact, because of the government’s involvement, the creditors are receiving a better deal than they would if Chrysler were allowed to proceed through bankruptcy without government help.

The following article, the best account of what has happened so far, makes it clear that the government’s willingness to finance Chryler’s restructuring, benefitting both the unions and the creditors, made the creditors sign on. If creditors thought they could get more money without government involvement, they were welcom to try. There was no legal compulsion.

U.S. Forced Chrysler’s Creditors to Blink, WSJ 5/11:

[Government negotiator Steven] “Rattner forced the issue during the spring negotiations. More than once, he told [lender James] Lee: "You can have the company and run it or liquidate it."

And:

“In the following days, the lenders began to realize their leverage was small and dwindling. Only the government had the ability or willingness to finance a bankruptcy reorganization of Chrysler, while also supporting its warranties and suppliers and recapitalizing Chrysler Financial. None of the lenders, some of which had consumer operations in the Midwest near Chrysler plants, had any desire to take over and liquidate the company.”

Ultimately the creditors are upset because they feel any largesse flowing from the government to Chrysler should benefit themselves more than the unions. That’s because without government help, the creditors would have come out ahead of the unions in a bankruptcy proceeding, even though both would be worse off than they are now.

But bailouts never treat all parties fairly. If they were, they wouldn’t be bailouts.

The fact that you and George Will think the government’s decision to favor unions with a few tens of billions of dollars is an outrage and a perversion of justice – while accepting as a matter of course its decision to favor Wall Street banks and insurance firms with hundreds of billions, only shows how grand your sense of entitlemnt really is.

May 15, 2009 at 3:51 PM
blighter said...

Not knowing who you are, my anonymous friend, I have to question your reading comprehension skills.

This post mentioned nothing about the bailouts, auto or otherwise. I believe Will's line applies to much of the bailout activity (financial and otherwise, before you go off on that high horse again) but also to many other decisions and actions taken by the Obama administration.

Indeed, so does Will, it seems, as the first half of his column was about the administration's forcing of California to concede to their unions instead of making necessary cost cutting measures.

I guess you somehow missed that half of the column.

More broadly, your repeated comments always seem to divine meanings and beliefs for me that have not been stated in any of my posts and which I do not hold.

Now that I'm getting into a lighter season at work, perhaps I can devote a bit of time to pointing out the many, many instances in which you have misread, misinterpreted, or otherwise missed the point of what I was saying and have imputed beliefs, habits and motives to me without any evidence whatsoever.

It can be a little summer project for us!

As ever, thanks for reading!

May 15, 2009 at 4:41 PM

Post a Comment

Subscribe to: Post Comments (Atom)