After weeks of White House threats and media cover-up, Chrysler’s remaining debt holders got their day before the Supreme Court Tuesday . . . and lost. The decision was no surprise to legal experts who say Chrysler’s restructuring was simply too far down the road to reverse. No doubt, this entire episode would have been different if a Republican administration had sought to rip up bankruptcy laws to benefit political allies. The media watchdog would have barked, fundamentally changing the playing field.
While the White House claimed victory, the plaintiff Indiana pension funds at least scored points that may protect against future abuses of government power. “The public is watching and needs to see that, particularly when the system is under stress, the rule of law will be honored and an independent judiciary will properly scrutinize the actions of a massively powerful executive branch,” lawyers for Indiana public employees wrote the Supreme Court.
The ruling also clarified where America’s self-appointed Democratic civil libertarians really stand when it comes to the rule of law.
“Other stakeholders, including other secured lenders and Chrysler’s autoworkers, accepted shared sacrifice because they recognized their interest was better served keeping Chrysler alive rather than forcing liquidation,” Rep. Gary Peters (D., Mich.) said in a statement, tacitly endorsing the administration’s threats that forced “other stakeholders” to fold their tent, leaving the Indiana pensioners alone in challenging Don Obama and his crew. “Why the officials who decided to take their objections all the way to the Supreme Court can’t recognize this is beyond me.”
Rep. John Dingell (D., Mich.), echoed Peters in attacking Indiana pensioners whose retirement savings were wrapped up in Chrysler bonds: “By refusing to make the relatively small sacrifices that would avert a calamity. The pension funds will instead create a great catastrophe, which is the same kind of short-sighted thinking that got us into the Great Depression.”
It should be noted that Chrysler’s unions, unsecured creditors who jumped to the head of the line thanks to White House power play, did not give an inch on their base pay or pension terms. Who would call that shared sacrifice?
Editor’s note: This article has been amended since its initial posting.