Saturday, May 02, 2009

Who are the 'Vultures'?

Obama went out of his way to vilify Chrysler's secured creditors. Who are they? King Banaian has a nice analysis, rightly describing Obama's speech on the subject as 'contemptible'.
Today in the filing in bankruptcy court we know something of who these thugs who "held out for the prospect of an unjustified taxpayer-funded bailout" are:
* Yale University's endowment;
* the University of Kentucky's endowment;
* the Bill and Melissa Gates Foundation.

King describes the situation well:
Many bought the debt knowing that bankruptcy was possible. They did so under the expectation that the rule of law would apply in America, that their place in line under bankruptcy law was purchased with that debt. President Obama's ire over their unwillingness to give away that place in line -- a place purchased by those endowments and foundations and pensions not for themselves but for students, pensioners and grant recipients -- is an indication that the president thinks his noble ends are superior to theirs.

I think 'contemptible' is kind.
King is, I think, overly hopeful about the future:
The president is trained in the law and understands the rights senior creditors have. He may hope he gets a better deal in bankruptcy court, but if the creditors are able to force liquidation, the 2012 Republican nominee can remind Detroit that Obama let this go to bankruptcy court because he wouldn't give these creditors an extra $250 million for a right they had paid for.


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