Earlier this week, Senate Democrats quashed an attempt to amend a bankruptcy bill that would have given judges the power to reduce the principal on mortgages of distressed homeowners, swallowing an explanation from the banking industry that reducing the value of mortgages would make it harder for other Americans to get a loan.
Apparently, though, if you’re a car company formerly owned by a private equity firm — and soon to be taken over by a powerful union and an Italian automaker, there are different rules.
As part of the company’s bankruptcy filing, Chrysler LLC will not repay US taxpayers more than $7 billion it received as part of the company’s bailout earlier this year. Instead, the US Government will get an 8% ownership in a firm whose value continues to deteriorate by the day.
The detail was buried in Chrysler’s bankruptcy filings last week, and overlooked until today. A senior Obama official confirmed the news to CNN.
The Obama Administration’s Treasury Department has agreed to give up the $4 billion “bridge loan” extended by the Bush administration, a $300 million fee on the loan, and another $3.2 billion the Obama administration agreed to shell out — last week.
CNN writes. A portion of the bridge loan could conceivably be recovered from Chrysler Financial, the firm’s erstwhile credit arm, only that unit is going out of business as well.
an Obama official told CNN, noting the 8% equity stake the US will be receiving.
the official added.
Asked about the plan to take more than $7 billion in taxpayer cash, a Chrysler spokeswoman said very little.
“The content of the document needs to speak for itself,” spokeswoman Lori McTavish said. “We are simply not in a position to comment.”
Chrysler could receive billions more in loans the administration says will be paid back. The terms of those “loans” are yet to be determined.
Who would have thought that we would have lost our money by throwing it at a company that was, by their own admission, on the brink of bankruptcy or going out of business...
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A core liberal ideal: "The best defense against lawless rogues who possess _______ is for law-abiding individuals to surrender their own _______________."
yeah i think the government need to take a pay cut till it's all paid back.
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"We defend freedom here or it is gone. There is no place for us to run, only to make a stand. And if we fail, I think we face telling our children, and our children's children, what it was we found more precious than freedom. Because I am sure that someday - if we fail in this - there will be a generation that will ask."
- Ronald Wilson Reagan
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