President Barack Obama insists he doesn't want to run the domestic auto industry -- and we should all be thankful for that.
But his actions speak differently -- and we should all be worried.
"... I rejected the original restructuring plan" that Chrysler LLC submitted for government loans, he said April 30 in announcing his decision to force Chrysler into bankruptcy. "... And the standard I set was high -- I challenged them to design a plan ..."
That's a lot of self promotion and involvement from a guy who doesn't want to control the companies.
To be sure, the government, with the investment of $4 billion in our tax dollars in Chrysler and $15.4 billion in General Motors Corp. needs to set guidelines and rules for repayment. If not met, call the loans and get our money back.
But forcing a private American company into bankruptcy because the president thinks it's the most prudent action. Um, no. Not by any measure.
Blaming the hedge funds
The president found a scapegoat in the hedge funds that balked at the government's "offer" to take pennies on the dollar for their secured investment
"... It was unacceptable to let a small group of speculators endanger Chrysler's future by refusing to sacrifice like everyone else," he said.
Pardon me while I puke.
Chrysler's secured lenders held about $6.9 billion in debt and a couple didn't want to take significantly less than what they were owed. The lenders that opposed hold less than 10 percent of that debt.
You mean to tell me that the president, who has authorized more than $19 billion in cash to the auto companies, with much of it likely never to be repaid, was willing to force Chrysler into bankruptcy over less than a billion bucks?
When you're doling out dump trucks full of cash, another Ram pickup full doesn't break the government's back.
Too much auto ignorance
Make no mistake: The president had this outcome in mind all along. He'll force that action on GM, too.
All the while bashing Detroit for not being Toyota.
"I don't know how to create an affordable, well-designed plug-in hybrid. But I know that, if the Japanese can design an affordable, well-designed hybrid, then, doggone it, the American people should be able to do the same," he said during his 100-days-in-office speech. "So my job is to ask the auto industry: Why is it you guys can't do this?"
Seriously? GM is building the Volt. The Ford Fusion hybrid will get top mileage numbers.It's about time Obama starts looking past the nonsense he's being fed by Californians in Congress. Certainly, the domestic industry needs to do more and it didn't adapt fast enough.
But to suggest that less than a billion bucks forced Chrysler into court or that these companies aren't in the same league as the Japanese shows that the auto ignorance in Washington rolls on.