Obama tells
banks and corporation
how it's gonna be.
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Obama's Gangster Tactics Corroborated |
Creditors to Chrysler describe negotiations with the company and the
Obama administration as "a farce," saying the administration was bent on
forcing their hands using hardball tactics and threats.
Conversations with administration officials left them expecting that
they would be politically targeted, two participants in the negotiations
said.
Although the focus has so been on allegations that the
White House threatened Perella Weinberg, sources familiar with the
matter say that other firms felt
they were threatened as well. None of
the sources would agree to speak except on the condition of anonymity,
citing fear of political repercussions.
The sources, who
represent creditors to Chrysler, say they were taken aback by the
hardball tactics that the Obama administration employed to cajole them
into acquiescing to plans to restructure Chrysler. One person described
the administration as the most shocking "end justifies the means" group
they have ever encountered. Another characterized Obama was "the most
dangerous smooth talker on the planet -- and I knew Kissinger." Both were
voters for Obama in the last election.
One participant in
negotiations said that the administration's tactic was to present what
one described as a "madman theory of the presidency" in which
Obama is someone to be feared because he was willing to do anything
to get his way. The person said this threat was taken very seriously by
his firm.
The White House has denied the allegation that it
threatened Perella Weinberg.
Last week Obama singled out the
firms that continue to oppose his plan for Chrysler, saying he would not
stand with them. Perella Weinberg says it was convinced to support the
plan by this stark drawing of a line between firms that have his backing and those that did not. They didn't want to be on
the wrong side of Obama. Privately, administration officials have
expressed confidence that other firms will switch sides for this reason.
These allegations add to the picture of an administration willing to
use intimidation to win over support for its Chrysler plans -- and then
categorically deny it.
So,
who's surprised? |
Obama Deal Violates 5th Amendment |
If Obama expected the senior
creditors of Chrysler to fold their tents under political pressure, they
may have gotten a rude shock today. Thomas Lauria, who accused the White
House of threatening the creditors withn humiliation at the hands of the
White House press corps, has
filed a motion to halt the administration’s
machinations on behalf of the UAW in the Chrysler bankruptcy. Lauria and
his allies claim that the Obama administration has violated the
Constitution in their bid to devalue the senior creditors’ holdings on
behalf of junior creditors, and have some precedent to support the
allegation.
The heart of the argument starts on page 8 (via HA
commenter Outlander):
III. The Taking of Collateral through a
Direct or Indirect Use of TARP Authority is Unconstitutional.
13. The Treasury Department relies on TARP as the purported authority to
justify the disparate treatment under the 363 Sale, even though TARP was
enacted after the Senior Lenders’ liens on the Debtors’ property were
already in place. The Supreme Court long ago recognized, however, that a
secured creditor’s interest in specific property is protected in
bankruptcy under the Fifth Amendment. Louisville Joint Stock Land Bank
v. Radford, 295 U.S. 555, 594 (1935). That case involved a
Depression-era statute that was intended to help bankrupt farmers avoid
losing their land in mortgage foreclosure. The statute in Radford
provided that the bankrupt debtor could achieve a release of the
security interests either (i) with the lender’s consent, purchasing the
property at its then appraised value by making deferred payments for two
to six years at statutorily-set interest rates; or (ii) by seeking from
the bankruptcy court a stay of the proceedings for up to five years
during which time the debtor could use the property by paying a rent set
by the court, which payments would be for the benefit of all creditors,
with a purchase option at the end of that period. Id. at 856-57.
14. Justice Brandeis noted that the "essence of a mortgage" is the right
of the secured party "to insist upon full payment before giving up his
security [i.e., the property pledged]." Radford, 295 U.S. at 580. In
invalidating the statute, the Court stated that "[t]he bankruptcy power
. . . is subject to the Fifth Amendment," and that the pernicious aspect
of this law was its "taking of substantive rights in specific property
acquired by the bank prior to the act." Id. at 589-90 (emphasis added). Thus, Congress could not pass a law that could be used to deny to
secured creditors their rights to realize upon the specific property
pledged to them or "the right to control meanwhile the property during
the period of default." Id. at 594. That is precisely what the Treasury
Department would have Chrysler do here, with respect to the Chrysler
Non-TARP Lenders' property rights that were acquired prior to the
enactment of TARP.
15. Relying on purported authority provided by
TARP, the Treasury Department is demanding that Chrysler’s assets be
stripped away from the coverage of the Senior Lenders’ liens -- thereby
impairing the rights of the Senior Lenders to realize upon those assets
-- so that those assets may be put in New Chrysler and used to the
benefit of unsecured creditors in this proceeding, who will then be paid
much more than the Senior Lenders. But, even assuming that TARP provides
the Treasury Department with authority to provide funding to the Debtors
and impose the transfer of collateral away from the Senior Lenders, TARP
was enacted long after the Senior Lenders contracted with the Debtors
and received senior liens on the Debtors’ property. Radford specifically
disallowed the use of a law to retroactively alter existing liens on
property.
16. Here, the proposed sale of the Debtors’ assets will
leave the Senior Lenders with a diluted pool of assets and no further
interests in the operating assets covered by their specific liens. The
Constitution forbids this application of a law retroactively to undercut
the Senior Lenders’ pre-existing property rights in favor or inferior
creditors.
17. Finally, that the Treasury Department would take
these unconstitutional actions to help the United States address
difficult economic times is not an answer. Indeed, the same
justification was expressly rejected in Radford, where Justice Brandeis
noted that a statute which violated secured creditors’ rights, but which
was passed for sound public purposes relating to the Great Depression,
could not be saved because "the Fifth Amendment commands that, however
great the nation’s need, private property shall not be thus taken even
for a wholly public use without just compensation." Id. at 602.
18. What is really striking here is that what is being proposed by the
Sale Motion would strip the Collateral away and allow it to be put to
use as new capital in New Chrysler for the benefit of existing and other
creditors -- even though the Chrysler Non-TARP Lenders have been given no
opportunity to realize upon that Collateral to the point of full
repayment ahead of at least $14 billion of selectively identified
unsecured creditors.
One might think that a Constitutional
scholar like Barack Obama would have already known that, but either this
precedent escaped him or he doesn’t care about it at all. Brandeis acted
to uphold contract law, especially in the face of a government interest
in paying off politically-connected unsecured creditors ahead of the
senior creditors. There is no other reason for Brandeis to make that
decision, as only government could insert itself into the contractual
relationship during a bankruptcy proceeding -- just as Obama has done
with Chrysler.
Lauria’s argument seems very compelling here,
especially given Brandeis’ rather clear assertion that bankruptcy
proceedings have to fall within the 5th Amendment -- and that government
can’t implement a taking to satisfy its own arbitrary aims by ignoring
the relationship of the creditors to the default. We’ll see whether the
court rebukes Obama.
Via
HotAir.com . . . |
Obama Wrong On Ethics And History |
Paul
Mirengoff
writes that Obama has said that the U.S. "lost its moral
bearings" under President Bush. In so asserting, Obama is making both a
claim about morality and a claim about history. He is saying that Bush's
policies with respect to detainee interrogation (the subject about which
Obama was speaking) were immoral and he is saying that they represent a
major departure from past policy.
Obama's moral claim is
unsustainable. Indeed, Mirengoff considers it frivolous to describe as
immoral decisions to subject terrorists to, say, sleep deprivation,
slapping, and waterboarding (a procedure we have used our own personnel)
for the purpose of obtaining information that could potentially save
innocent lives, where the decision is made with the good faith belief
that the information cannot be obtained through less harsh means.
It's usually not possible, however, to change someone's mind on a
moral question. But what of the historical question; is it true that
Bush administration interrogation techniques represent a significant
departure from past practice? This is a factual question and thus should
yield a much less controversial answer.
A piece in the current
issue of Yale Law Journal by William Ranney Levi argues that there has
been no dramatic break. Mirengoff hopes to discuss this law review
"Note" (it's called that because the author is a student, not a
professor or a practicing attorney) in more detail when he has the
opportunity. Tonight, he will simply quote the conclusion to Levi's
piece:
This Note has shown that in times of national insecurity
since World War II, the law has been interpreted to permit the
authorization of highly coercive interrogation methods. The current
debate over interrogation law and policy is not served by the erroneous
historical framework to which even the opposing parties to this debate
have subscribed, namely, that a dramatic break with the past occurred in
the aftermath of 2001.
Interrogation's law -- the absolute bans
on vaguely defined abuse -- has provided the latitude that has, in turn,
permitted the authorization of coercive interrogation since World War
II. To declare that the law's mandates were clear before 9/11 but
grossly misconstrued -- even repudiated -- in its aftermath, and that if only properly acknowledged will be clear yet again, is to delegate the
tough questions in future interrogation dramas to the executive branch
agencies discussed in this Note.
This Note has shown how, prior
to 9/11, responsible officials who wished to obey the law's uncertain
boundaries found sufficient latitude to authorize highly coercive
interrogation techniques. In light of the past, there is little reason
to expect different practices in times of future fear. If this is
troubling, then a rethinking of interrogation law and policy is
necessary.
|
Obama Covets Offshore Funds |
Obama
vowed Monday to "detect and pursue" American tax evaders and go
after their offshore tax shelters.
In announcing a series of
steps aimed at overhauling the U.S. tax code, Obama complained that
existing law makes it possible to "pay lower taxes if you create a job
in Bangalore, India, than if you create one in Buffalo, New York."
The president said he wants to prevent U.S. companies from deferring
tax payments by keeping profits in foreign countries rather than
recording them at home and called for more transparency in bank accounts
that Americans hold in notorious tax havens like the Cayman Islands.
"If financial institutions won't cooperate with us, we will assume
that they are sheltering money in tax havens and act accordingly," Obama
said.
There will have to be loopholes in this
anti-loophole bill.
After all, the Kennedy Family’s greatest
asset, the Merchandise Mart
has its corporate offices in Fiji.
You know Obama isn’t going to
touch that one.
The Senior Senator from Massachusetts belongs to
a family clan blessed with a net worth of nearly $500 million.
Back in 1935, Joseph Patrick Kennedy, Sr., purchased Merchandise Mart, a
Chicago real estate company:
"...in 1947, he divided its
ownership among family members and put it in the form of a trust....
[it] was not set up in their home state of Massachusetts, New York,
Florida, or even California. This trust wasn’t even domiciled in the
United States. Instead the Kennedy trust was set up in ...
Fiji."
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Would You Buy A Car From Obama |
Obama has given his
personal warranty on cars from Detroit -- if a fuel pump on your new
Pontiac falls apart and the dealer won't make it good, just call the
White House and ask for Obama. Happy days are here again.
The
transformation of the American automobile industry into a government
operation, managed from Europe, may be the preview of how Obama intends
to remake America in the image of the Old Country. London's Financial
Times reported Monday that Sergio Marchionne, the chief executive of
Fiat, has big plans for consolidating Fiat, Chrysler and General Motors
Europe into an enormous new publicly traded European car company.
All hail Fiat/Chrysler, of course, and may all the little Fiats run
forever. But Fiat's reputation in America is not great; those who
remember them at all remember Fiats are underpowered tin cans, shoddy
and unaccountably ugly given the Italian gift of good design, tolerable
for the relatively short distances typical of European road trips. But
not at all happy with running at high speeds on the interstates all day,
600 miles from dawn to a destination in early evening.
The Fiat
scheme, like most European ventures into the marketplace, requires a
caress from the dead hand of government. Mr. Marchionne must first
persuade the governments in Britain, Germany and others where Opels,
Fiats, Vauxhalls and Saabs are built under the GM umbrella to lend a
hand -- and a lot of cash. The "market" is mistrusted in the European
social-welfare states because it swiftly and efficiently separates
winners and losers.
GM and Chrysler collapsed just as they have
actually begun to build good cars. The automakers are learning to their
considerable pain that destroying a reputation is a lot easier than
building one. Putting together loans backed by greedy governments will
be considerably easier than fixing what went wrong in Detroit. The
further irony is that the United Auto Workers, which extracted the
featherbed contracts a quarter of a century ago that doomed GM and
Chrysler, will now hold a majority stake in Chrysler and a slightly
smaller stake in GM.
We'll see now how the UAW deals with
self-abuse. In the early '70s GM imagined that it could stay rich
forever selling junk if only it could avoid strikes that shut down the
junk-assembly lines. So it agreed to anything the unions demanded.
Then the Japanese arrived with cars of modest size and high quality;
the impact on Detroit was of a reprise of Pearl Harbor.
Buying
American" is not as simple as it once was; Toyota, Nissan, Honda,
Hyundai, BMW and Mercedes are built in America, too. Buying from GM and
Chrysler may be an act of good citizenship, anyway. But if you buy a
Pontiac Vibe or a Chrysler convertible, keep Obama's telephone number at
hand. |
Obama's Cinco de Cuatro |
Mary Katharine Ham likes
to note these
little incidents when they happen, not because she thinks it makes Obama
an idiot because he occasionally stumbles over his words, but because
his somewhat overblown reputation as the most cerebral, eloquent,
utterly erudite president of all time could really use a pricking every
now and then.
Also, because if Bush had made such a blunder, it
would have been the basis of a four-part MSNBC investigative series on
the malapropism's deleterious effects on the Republican Party's attempts
to woo Hispanic voters, Mexican-American relations, and our "place in
the world."
So, Obama, Mary Katharine will not turn your tendency
to misspeak (and, then reprimand your Teleprompter) into an
international incident, but she will note it with some glee:
On
the eve of the Mexican holiday, Obama on Monday had an event in the East
Room of the White House with Mexico's Ambassador Arturo Sarukhan.
Obama joked
that it was "Cinco de Cuatro," botching a play on the Spanish word for
"four" when he meant to say "Cuatro de Mayo," or the Fourth of May. He
tried again, but he still did not get it right.
This from a
unilingual man who's embarrassed that more of us can't speak French and
suggested that we all learn Spanish. If only he were as conversant in
Spanish as he is in noted non-language "Austrian," this wouldn't have
happened.
The literal translation of "cinco de cuatro" is "five
of four." Maybe Obama was talking about the time of day? He
quits working at 4 PM -- it's in his union contract -- and was just
warning all present that he was done for the day -- he gets
tired, you know. |
Anna's Dissertation |
A dissertation written by
Obama's late mother is being published.
Duke University Press
said Monday that an edited version of Ann Dunham's anthropological study
about rural craftsmen in Indonesia is scheduled to reach stores this
fall. Dunham completed the study three years before she died in 1995.
Duke marketing manager Emily Young said the foreword was written by
Obama's half-sister and Dunham's daughter, Maya Soetoro-Ng.
The
book is based on Ann Dunham's 14 years of research among village workers
on the Indonesian island of Java.
Young said the project came to
the university's press arm because it has a reputation for publishing
anthropological studies.
The
operative words in this press release are "edited version" -- all the
anti-American, communist stuff will be redacted.
This is just
more sanitizing of the legend. |
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