Obama To Chrysler: I Will Make Them An Offer They Can’t Refuse

What would happen if one branch of the government tries to interfere in an area that is the province of another branch? In a normal world the interfering branch is slapped back; but this is not a normal world, this is Obamaland.

The interview below features attorney Tom Lauria detailing how the Executive Branch of the United States government is serving as the negotiator, arbitrator, and judge, in the dismantling of Chrysler. This is clearly a violation of the separation of powers, and a dishonest attempt by the Obama administration to reward those that supported him.

The Obama administration has gone so far as to change the “pecking order” on who will be receiving money that is owed to them, and how much these companies will receive. It appears that the Obama administration has determined that entities (such as the unions) that had a lower financial commitment within Chrysler have been moved to the top of the monetary heap, receiving a higher percentage than companies who had been keeping Chrysler afloat before the government stepped in.

Fasicism, socialism…tomato, toemoto…let’s call the whole thing off!

Zero Hedge summarizes and surmises (from hotair.com):

In an interview of momentous importance, WJR’s Frank Beckmann interviews Tom Lauria, the Head of Restructuring at top five law firm White & Case, in which the lawyer, who represents Chrysler hold-out hedge funds Stairway Capital and Oppenheimer Funds, discusses on the record the amazing treatment by the White House of Perella Weinberg, which initially had been a transaction hold out but after threats by the White House (not my words) was forced to drop their objection and go with the administration. Says Lauria:

“One of my clients 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…That was Perella Weinberg.”

…The full interview with Tom Lauria below is a must hear for everyone as it discloses not only the administration’s strong arming tactics in black and white, but also discloses some other critical facts that the president on his regular TV appearances has failed to mention such as:

- First lien holders were willing to accept a 50% discount on their positions, however the 71% demanded by the administration was seen as too much.
- The cash going to Junior claims (creditors below the first liens) will be between $10 and $20 billion, a number which in practice should satisfy a par recovery for the 1st liens if the Absolute Priority Rule was actually withheld.
- Among the creditors are not just vulturous hedge funds but “pensioners, teachers, credit unions, college endowments, retirement plans, and personal retirement accounts.”

In conclusion, Lauria summarizes the developing Chrysler mess best:

“The President is trying to abrogate contractual rights; if he will attack that contractual right, what right will he not attack?”