Tag: treasury

Shocker: Chrysler Won’t Repay Bailout Money

There goes that cash… straight down the money pit.

But, hey, what’s $7 Billion among friends. Especially nowadays:

Chrysler LLC will not repay U.S. taxpayers more than $7 billion in bailout money it received earlier this year and as part of its bankruptcy filing.

This revelation was buried within Chrysler’s bankruptcy filings last week and confirmed by the Obama administration Tuesday. The filings included a list of business assumptions from one of the company’s key financial advisors in the bankruptcy case.

Now, a pessimist might say that the bailout money has gone down the black hole that these failing companies are and we will never see any of it repaid (even if the companies want to repay it). Unfortunately I am a pessimist. After all the government would much rather own or control these companies than get money back from them:

An Obama administration official confirmed Tuesday that Chrysler won’t be repaying the loans, though a portion of the bridge loan may be recovered by Treasury from the assets of Chrysler Financial, the former credit arm of the automaker which is essentially going out of business as part of the reorganization.

“The reality now is that the face value [of the $4 billion bridge loan] will be written off in the bankruptcy process,” said the official, who added that the 8% equity stake that Treasury will be receiving as part of the company’s reorganization is meant to compensate taxpayers for the lost money.

Like I said… shocking.

Fox Business Wins Suit Against Treasury

Looks like the Treasury will actually how to tell us all how they’re wasting our money. That’s the end result of Fox Business Network’s Freedom of Information Act lawsuit against them:

FOX Business Network has won a victory against the Treasury Department in its Freedom of Information Act request for details about the government’s bailout plan.

Judge Richard J. Holwell of the U.S. District Court for the Southern District of New York said in a decision Friday that the government is directed to comply with FOX Business’s request under the FOIA “within 30 days and to produce a Vaughn index with 45 days.”

That means Treasury must comply with FOX Business’s request by Monday, April 23, and must produce a Vaughn index by Monday, April 6.

A Vaughn index details which documents have been withheld and why.

This is great news for those of us who, for some crazy reason, don’t blindly trust the government to spend our money in a wise or responsible way. Here’s exactly what FBN was looking for in this suit:

FBN asked the Treasury Department to identify, among other issues, the troubled assets purchased, any collateral extended, and any restrictions placed on these financial institutions for their participation in this program.

Not exactly unreasonable. Definitely important.

Good work FBN.

Paulson to Lend Money to Anybody Who Wants it

Gosh, doesn’t this sound familiar?

The government stepping in to let just about anybody borrow money regardless of their circumstances.

In fact, I’m relatively sure this is exactly what caused the problem in the first place. Ummm, yea, actually I’m completely positive of that.

Hmm lets think back to the first presidential debate when Obama claimed that deregulation was the cause of our economic ills. Here was my reaction then:

“Deregulation, Obama? Are you kidding? Was it deregulation that created organizations to give people loans that clearly weren’t qualified for them and never would have received them otherwise? Was it deregulation that mandated financial institutes give the same clearly unqualified people loans? Thus creating a massive and seemingly unending housing boom which then lead to a plethora of bad investments, investments which were sold by the government as safe investments. No Obama it wasn’t deregulation, it was idiots like you.”

But, obviously, Bush, Paulson, and the rest of our betterers in DC will never admitt that this is what happened and will, inevitably, stick with the same broken mentality that got us into this mess.

Does anybody see the supreme irony in this move by the government? I mean, yea, there’s the whole quandary of using the same tactics that got is in trouble in order to save us from that trouble. I’m almost convinced that this was the exact conversation that occured when this plan was being mulled over:

(several of Springfield’s best and brightest are stuck in a hole they dug while searching for buried treasure)

Mayor Quimby: Mmm, I guess we’re not gonna find anything.
Otto: Well how we gonna get outta here?
Homer: We’ll dig our way out!
Wiggum: No, no, dig up, stupid!

But I think, perhaps, the deeper irony lays in the fact that we are increasing our government’s debt for the express purpose of increasing consumer debt. In other words the government is spending money it doesn’t have in order to encourage people to spend money they don’t have. Does that sound like a downward spiral to fiscal hell to anybody else?

UPDATE: Michelle Malkin eventually weighed in on this…