2009 -- E Pluribus Unions
Chrysler
April 28 (Bloomberg) -- The United Auto Workers union’s retiree health-care fund will own 55 percent of Chrysler LLC in exchange for cutting in half the automaker’s $10.6 billion cash obligation to the trust, people familiar with the matter said.
GM
GM’s restructuring plan would lower its debt by $44bn to an estimated $23bn, leaving the government and a healthcare trust managed by the United Auto Workers union with 89 per cent of the equity. The rest would be mainly in the hands of holders of $27bn of unsecured bonds, who are being asked to swap their holdings for shares and accrued interest. Existing shareholders would be left with a minuscule stake. Washington would swap half its loans for equity.
Stockholders get zilch.
Did anyone think it would get this bad so fast?
3 comments:
Well, I guess the unions got a pretty good return on investment for funding Obama's campaign.
Read this WSJ editorial.
It has been going bad for a long time. A rapid credit contraction only made more chickens return to roost more quickly.
I happen to think it is fitting the UAW are becoming majority shareholders.
The state of the auto industry is largely due to their being monopoly providers of labor (mix in a large dollop of long time Congressional stupidity, as well).
I don't think you can pin this on Obama.
And I also don't think this is going to work out at all well for the unions, either.
We've been pandering to the unions for almost as long as I've been alive.
I read the article and you're right, we can't pin the past 50 years of pandering to the unions on Obama, but we can pin it on nonsensical liberal policies and this latest travesty is on him and him alone.
Let the auto companies go bankrupt the old fashioned way.
FTA -- This says it all, Lately some have doted, with wonderment and admiration, on the Obama administration's apparent willingness to drive a hard bargain with the UAW as it tries to impose a stage-managed replica of bankruptcy on GM and Chrysler. Please.
In a real bankruptcy, which is the natural fate of companies unable to meet their obligations, Chrysler and GM would be run (or liquidated) for the benefit of their creditors, not their workers.You heard it here first. As soon as an agreement is reached, the union will revert to the tried and true and call a strike.
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