The Obama Administration appears about to walk away from $7.5 billion in taxpayer money used to prop up Chrysler. This little information nugget was buried in Chrysler’s filing before the bankruptcy judge last week and confirmed by Administration sources. So much for responsible government and transparency!
The Bush Administration pumped $4 billion into Chrysler to keep it alive long enough to go into bankruptcy well-prepared. Obama has waived the $4 billion and a $300 million fee. In exchange, taxpayers are receiving an 8 percent stake in a company likely worth zilch.
In addition, the Obama Administration loaned another $3.2 billion to keep Chrysler operating in bankruptcy. Expected repayment: zilch.
But the plan is to use Chrysler’s assets to pay off creditors and replenish the UAW’s fund for its retirees, with enough left over to make the new Chrysler a pretty bride for Fiat the Italian groom. There’s nothing wrong with Fiat acquiring a controlling position in a new Chrysler. But the taxpayers shouldn’t be asked to fund a $7.5 billion dowry. Before any monies are paid to the autoworkers’ union, Fiat, or any non-secured creditor, taxpayers should get their money back.
