Enemy Of The Economy

Elizabeth Warren has never held a private sector job, never worked in the financial industry, and she hates banks, with a passion. So, what’s Obama’s brilliant idea? Let’s put her in charge of the new Bureau of Consumer Financial Protection bureaucracy! There’s only one problem, that position requires Senate confirmation and Warren is so toxic that even top Democrats know that there’s no way she would ever be confirmed. So, does that stop Obama, have Constitutional requirements ever stopped Obama? Hell no! Obama just ignored the Senate confirmation requirement and appointed her as his newest “czarina”.

Obama names Warren to new post

President Obama on Friday formally tapped Harvard Law Prof. Elizabeth Warren as a “special adviser” tasked with setting up a new consumer watchdog agency, sidestepping a thorny Senate confirmation battle and drawing the ire of Republicans.

Ms. Warren, who had been serving as head of the investigative board that oversees the $700 billion Wall Street bailout, is a hero to many progressives but is viewed coolly by financial firms turned off by her harsh rhetoric surrounding their role in the recession.

That’s likely one of the reasons Mr. Obama opted not to name Ms. Warren director of the Consumer Financial Protection Bureau as that position would require Senate confirmation — something that even Democrats, including Sen. Banking Committee Chairman Christopher Dodd, have said may not be possible. Instead, she will take the lead in establishing the new regulator, serving as a special adviser to Treasury Sec. Timothy Geithner and a special assistant to Mr. Obama.

See also:
Warren takes post; liberals cheer
Hurdles for Warren in Agency Launch
Warren is named bureau adviser
Obama taps Elizabeth Warren to launch Consumer Financial Protection Bureau
Barack Obama taps Elizabeth Warren for consumer watchdog job
What has Wall Street got against Elizabeth Warren?
Obama names consumer advocate Warren to new post
Obama makes it offical: taps Elizabeth Warren as financial consumer czar
Elizabeth Warren
Elizabeth Warren

Oh boy, just what this economy needs, a brand new gigantic government bureaucracy, created by someone with zero private sector experience, that will generate reams of onerous new government regulations. Is it any wonder why the United States has such an unfriendly business climate?

/somewhere in Germany, the Board of Deutsche Bank is smiling

Not So Fast There Obama

Supreme Court Delays Chrysler’s Swift Sale

The U.S. Supreme Court yesterday held up the sale of Chrysler’s assets to Italian automaker Fiat, at least temporarily interrupting the Obama administration’s massive and speedy restructuring of the U.S. auto industry.

Justice Ruth Bader Ginsburg’s 53-word order did not hint at what she thought of an appeal led by a group of Indiana pension and construction funds, which stand to see their investments in Chrysler reduced with no say in the process. Instead, she instructed simply that the transaction is “stayed pending further notice.”

The decision buys the court time to consider objections filed over the weekend, and it comes as the clock is ticking. Fiat can back out of the deal if it is not finalized by Monday, and the government has warned that the only alternative would be to force the nation’s third-largest automaker into liquidation, throwing the industry in turmoil and leaving tens of thousands of people without jobs.

The stakes may be higher for the Obama administration: If the court backs some of the claims, it could disrupt plans to rescue General Motors and weaken the government’s hand in stabilizing the troubled economy.

“Every day that Chrysler remains in bankruptcy without consummating the sale threatens to postpone the resumption of production even further and to prolong the period of $100-million-per-day losses” financed by taxpayers, Elena Kagan, the U.S. solicitor general, said in a 26-page filing with the high court.

A host of business and conservative groups applauded Ginsburg for standing up to what one called the Obama administration steamroller. And Congress is beginning to stir. Legislation is being drafted to reverse decisions by Chrysler and GM to close thousands of dealerships. The Senate Banking Committee, meanwhile, is preparing to hold a hearing this week on the government’s role in the auto rescue.

The significance of the court’s action remains to be seen. The language Ginsburg used in her order usually signals a delay of short duration.

There could be several explanations, not the least of which is that the justices may not have had time to fully consider the request. Court filings from those opposing the deal began arriving over the weekend and into Sunday. The government’s response in opposition did not arrive at the court until shortly before justices convened yesterday at 10 a.m.

The petitions are directed at Ginsburg because she is the justice responsible for the circuit that includes New York, where the suit was filed. She may decide the stay issue on her own or refer the question to the full court. If it’s the latter, that could explain the need for more time. The full court would have to vote on whether to hear the merits of the case.

See also:
High court blocks Chrysler sale to Fiat
Supreme Court delays Chrysler sale
Chrysler sale on hold, but for how long?
Supreme Court asked to block Chrysler sale to Fiat
Supreme Court Asked to Block Chrysler Sale to Fiat

Of course Ginsburg’s stay doesn’t mean that the Supreme Court will take up the case, it only means that she wanted more time to decide. However, the Supreme Court should take on this case and take a good long look at the legality of the Chrysler/Fiat deal that Obama’s Car Task Force is trying to ram down the taxpayers’ throats. What’s the rush, are they trying to hide something?

The government’s first argument as to why this shotgun wedding must be rushed through is that the deal with Fiat is necessary to stop Chrysler’s “$100-million-per-day losses”. Well, gee, let me get this straight, Fiat gets Chrysler’s assets and suddenly Chrysler miraculously stops losing money. How does that work, exactly, magic?

The government’s other equally bogus argument for steamrolling the Chrysler bondholders is that “the clock is ticking, Fiat can back out of the deal if it is not finalized by Monday, and the government has warned that the only alternative would be to force the nation’s third-largest automaker into liquidation, throwing the industry in turmoil and leaving tens of thousands of people without jobs.”

Really, are they sure Fiat will back out? That’s not what the Fiat CEO said earlier today.

Fiat Will ‘Never’ Walk Away From Chrysler, CEO Says (Update1)

Fiat SpA will “never” walk away from its deal with Chrysler LLC, Fiat Chief Executive Officer Sergio Marchionne said in an interview.

“We should just be patient and let the system work,” Marchionne said by telephone today moments after Justice Ruth Bader Ginsburg ordered a delay of Chrysler’s planned sale to the Italian carmaker while the U.S. Supreme Court considers a request for a longer postponement that might scuttle the deal.

A federal appeals court in New York last week allowed the sale, while putting its decision on hold until 4 p.m. today to let opponents, including Indiana pension funds, seek Supreme Court intervention. The Indiana pension funds hold $42.5 million of $6.9 billion in Chrysler’s secured loans.

“We would never walk away,” Marchionne said in response to a question about whether Fiat would pull out of the deal if it isn’t completed by the June 15 deadline. “Never.”

So, there’s no good excuse not to slow this deal down and let the Supreme Court take a careful look at the legality of it. The real reason the Obama administration wants to cram this down the taxpayers’ throats, without any meaningful scrutiny, is to cover up their abhorrent, thuggish behavior, motivated by the single minded purpose of protecting the UAW, whatever cost to the taxpayers be damned. The Obama Auto Task Force wants to get this deal done because the unseemly details concerning their extremely questionable tactics and purpose are starting to see the light of day and honest people are starting to ask some hard, honest questions.

U.S. Pushed Fiat Deal on Chrysler

The Obama administration rushed an alliance between Chrysler LLC and Fiat SpA despite Chrysler’s worries about Fiat’s financial health and its willingness to share technology, according to internal company emails.

The emails show Fiat ignoring requests for documents and trying to change contract terms late in the talks. A Chrysler adviser at one point said the deal risked looking as if the U.S. auto maker and the Treasury Department, which helped broker the pact, were “in bed with a shady partner.” In another note, an official referred to the Treasury Department as “God.”

The documents, filed in the Southern District of New York as part of Chrysler’s bankruptcy proceedings, provide a glimpse at the tense debates that shaped Chrysler’s final days as it raced to find a suitor.

On Friday, a federal appeals court upheld Chrysler’s Fiat deal, dismissing a challenge by dissident Chrysler debt holders. But the court also issued a stay until 4 p.m. Monday — leaving a small window for Thomas Lauria, the lawyer pursuing the case, to appeal to the Supreme Court. One judge on the three-judge panel suggested the Supreme Court should have “a swing at this ball.”

Mr. Lauria’s persistence led one government lawyer in the Chrysler case to dub him a “terrorist” in an email to a Chrysler adviser.

See also:
Obama’s man called shots on bankruptcy
Chrysler-Fiat Deal: U.S. Government as “God”

UPDATE: Indiana vs. Chrysler: Was TARP Used Illegally?

A quick scan of the 169-page legislation detailing the purpose of the Troubled Asset Relief Fund doesn’t say anything about automobile companies. Nor does it say anything about using the government’s money to bail out nonfinancial institutions generally.

On its face then, it might appear the Indiana pension funds have a solid argument in challenging the U.S. Treasury Department’s use of TARP funds to finance Chrysler’s restructuring. That point is at the heart of the pension funds’ effort to persuade the Supreme Court to issue a stay the Chrysler-Fiat deal. The stay asks for a temporary hold on the deal until the Justices can decide whether to hear the case.

See also:
Why the Legality of the Chrysler Bailout Won’t Matter
Senate panel to question Obama auto task force

Like a dead, flattened skunk on a hot asphalt road at high noon on a sunny 950 day, this Chrysler/Fiat deal stinks to high heaven. Just a few of the serious problems with it include the government coercion of a private corporation, the trammeling of first lien secured creditors’ legal rights in favor of unsecured creditors, the abrogation of well settled bakruptcy law and established capital structure, and the possible illegal use of and wasteful spending of taxpayer money. And these same legal concerns are also cropping up in the GM banruptcy.

/all I can say is that if the U.S. Supreme Court doesn’t take on this case and sort through these very important legal issues threatening the existing rule of law in this country, they’ll be shirking their duty as a coequal branch of government and shame on them