As Hans Bader points out at OpenMarkets.org, "the UAW will receive at least ten times as much value as the bondholders even though the bondholders are owed more ($27 billion vs. $20 billion). This is neither legal nor fair."
Which brings us to President Obama's oft-repeated claim that his decisions are guided by the way they "affect the daily realities of people's lives."
Well, the ordinary folks whose retirement or savings were ravaged by automakers' plummeting stock prices are suffering doubly from Obama's devastating policy to force them to take pennies on the dollar if their portfolio also included GM bonds, which were once considered relatively safe.
By contrast, the very labor unions whose bloated benefits and anachronistic job protection schemes put GM at a competitive disadvantage are now rewarded with nearly $10 billion and 17.5 percent ownership in the company.
While Obama says UAW will be required to make "painful sacrifices," the union boasts that its members will see no reduction in 'base hourly pay, no reduction in … health care, and no reduction in benefits."
Might the $13 million that UAW spent on last year's election have tipped the scales in its favor? Heavens, no!
So, GM hinges its recovery on the marketing genius of politicians who gave us Medicare, Social Security, Amtrak, a 3.4-million-word tax code, and $11.3 trillion in debt.
It's hard to imagine how a fire sale administered without Obama's oversight could have been more destructive or more expensive.
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