Government Motors

United States citizens who have 401Ks, pension plans, or other investment interests dedicated to their future welfare, retirement, and savings are in serious jeopardy. I am not referring to the most obvious factor of the market being down 38% from it's highs, but the vilification of the President of the United States. President Obama was livid that the greedy speculators would not accept 29 cents on the dollar for the Chrysler debt they held. He failed to mention that those speculators were 401k plans, teacher's pensions plans, and other investments controlled by funds with a fiduciary responsibility to each individual investor. This group of investors represented 30% of the primary creditors and $7B in debt. The government offered them $2.25B. the other 70% of primary creditors were major financial institutions, having already received TARP funds, and had no choice but to take whatever the President was willing to offer. Such is the problem with nationalizing the banks. The banks can't even complain, but rather are forced, not only to acquiesce, but fully support with enthusiasm, anything the government puts on the table.

The President is giving 55% of Chrysler to the UAW, and 35% to Fiat, an Italian automaker who is functionally broke right now, and has never been able to successfully market automobiles in the United States. The American taxpayer is getting 8% for the ultimately $15B we will invest in real dollars. We coulde have bought Chrysler lock, stock, and barrel for 20% of that number months ago.

Under U.S. bankruptcy laws, creditors are paid first. These so called un -American speculators are primary creditors and are therefore entitled to receive all of their investment back that is possible to deliver. The UAW represents secondary creditors, who are owed their salaries, and the payment for legal binding contracts only after primary creditors are paid.

President Obama intends to re-distribute the wealth of our nation with utter disregard for the rule of law. If in fact he is successful in pressuring the bankruptcy court in New York of approving the government's plan, while stiffing the primary creditors, we can kiss every thing we own good-bye. It may only be bond holders of Chrysler today, but once the rule of law is sacrificed for political gain, the end of our path will be determined in all cases.

I saw op-eds during the campaign that stated then candidate Obama would effectively destroy the 401k program. Further stated was that his policies would destroy the wealth accumulated by those of us who have attained our status through hard work, and re-distribute it to those who, for whatever reason, lack the ability to survive from one paycheck to the next, or from one government check to the next. I scoffed at the notion then. I am now horrified that I can see exactly how he plans to do it.

Our country was made great by the rule of law. President Obama is an attorney, and taught constitutional law as a professor. He understands very well the atrocity he is attempting to commit on our government, and thus every American. We are allowing him to vilify any group he feels it expedient to vilify every time he sees fit. The group vilified today may very well be the group in favor tomorrow. Such is the nature of Socialism and governmental control. We are becoming Germany of the 1930s. The parallels are endless. But I digress. That is a subject for another day.

Riddle me this. What happens if the UAW owns 55% of Chrysler? They will be negotiating future UAW contracts primarily with themselves. It is a forgone conclusion the same will happen with General Motors in 30 to 60 days. The UAW can then bargain for whatever ridiculous terms they see fit to the behest of the union at two of the top three U.S. automakers. That leaves Ford hanging by a thread, as the UAW can force Ford into the same economically unrealistic contracts or go on strike against Ford, thereby removing the UAW's primary competitor in the domestic market. This effectively brings to it's knees the only U.S. automaker still financially viable. Do you believe this eventuality is lost on the UAW, the government, or President Obama? Not if you can walk and chew gum at the same time.