Hamilton, Madison, and Jay

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Location: Mesa, Arizona, United States

Who are we? We're a married couple who has a passion for politics and current events. That's what this site is about. If you read us, you know what we stand for.

Tuesday, May 5, 2009

Is This the Presidency or a Replay of The Godfather?

Last week a brouhaha erupted over whether or not the White House made a veiled threat to Chrysler's non-TARP lenders. Frank Beckmann conducted an interview with Tom Lauria, and in that interview, Mr. Lauria said the following:

"Well that's a great question, because let me tell you it's no fund standing on this side of the fence opposing the President of the United States. In fact, let me just say, people have asked me who I represent, and that's a moving target.

"I can tell you for sure that I represent one less investor today than I represented yesterday. One of my clients was directly threatened by the White House, and in essence compelled to withdraw its opposition to the deal under threat that the full force of the White House press corps would destroy its reputation if it continued to fight. That's how hard it is to stand on this side of the fence."

Naturally, the White House has denied any sort of threat was issued. Captain Ed @ Hot Air has a story that now corroborates the threat. From Business Insider:

Creditors to Chrysler describe negotiations with the company and the Obama administration as "a farce," saying the administration was bent on forcing their hands using hardball tactics and threats.

Conversations with administration officials left them expecting that they would be politically targeted, two participants in the negotiations said.

Although the focus has so been on allegations that the White House threatened Perella Weinberg, sources familiar with the matter say that other firms felt they were threatened as well. None of the sources would agree to speak except on the condition of anonymity, citing fear of political repercussions.

The sources, who represent creditors to Chrysler, say they were taken aback by the hardball tactics that the Obama administration employed to cajole them into acquiescing to plans to restructure Chrysler. One person described the administration as the most shocking "end justifies the means" group they have ever encountered. Another characterized Obama was "the most dangerous smooth talker on the planet- and I knew Kissinger." Both were voters for Obama in the last election.

One participant in negotiations said that the administration's tactic was to present what one described as a "madman theory of the presidency" in which the President is someone to be feared because he was willing to do anything to get his way. The person said this threat was taken very seriously by his firm.

This is insane, and worse, it is borderline illegal. This is very close to extortion, and it is coming directly from the White House. It may not be coming directly from the president's mouth, but it is coming from his associates and aides in the White House. The president cannot deny knowledge of what his people are doing with regard to Chrysler. He is neck deep in the Chrysler mess.

This is unprecedented what the government is doing with Chrysler, but pundits warned from the start that when you take the loan from the government, you accept the conditions and baggage that goes along with it. While we tend to agree with that notion, we will also point out this was the reason why Ford refused the bailout money. Too many strings were attached to the money, and Ford executives were not willing to relinquish any control of their company to the federal government.

But these threats tend to remind us, as they did with Captain Ed, as sort of Godfather-esque:

Michael: Well, when Johnny was first starting out, he was signed to a personal services contract with this big-band leader. And as his career got better and better, he wanted to get out of it. But the band leader wouldn't let him. Now, Johnny is my father's godson. So my father went to see this bandleader and offered him $10,000 to let Johnny go, but the bandleader said no. So the next day, my father went back, only this time with Luca Brasi. Within an hour, he had a signed release for a certified check of $1000.

Kay: How did he do that?

Michael: My father made him an offer he couldn't refuse.

Kay: What was that?

Michael: Luca Brasi held a gun to his head, and my father assured him that either his brains or his signature would be on the contract.

Some might find the analogy extreme because the government is not holding a gun to Chrysler's head now, nor did they hold one to their heads to take the money, but the threats is clearly on par with the analogy. Instead of a gun, the White House press corps would be loosed on those who do not want to play ball; turned loose on those that would prefer to go through the proper bankruptcy procedures.

The only hope we have is that when Chrysler does go to bankruptcy court, the judge will tell the White House to get stuffed on their overreach of control. All of these bailouts have allowed the government to step into private business, which is technically illegal. The Framers never gave the federal government that sort of power. But in an effort to run a radical agenda of redistribution of wealth, the White House, with a willing Congress, is dead set on doing just that. The takeover of Chrysler is nothing more than a payback to the UAW for their help in getting President Obama elected. The $787 billion in stimulus money, going to groups like the SEIU and ACORN was the tip of the payoff iceberg. With this we now see just how far the White House is willing to go to get it's way.

The nation should be concerned about these thuggish tactics. It leads us down a road we have been down before. As Jonah Goldberg recounted in his bestseller Liberal Fascism our first "thug-in-chief" was Woodrow Wilson, and he used the full weight of the presidency to push this nation down the early path to socialism. FDR progressed the move further with his tactics not only against detractors of his New Deal policies, but remember that he threatened to pack the Supreme Court with ideologues that would not oppose him. President Barack Obama is indeed much like these two men, and his policies and tactics prove it.