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Stuck With The Check

- February 28, 2012

Obama’s Union Cronies Are Backing His Campaign After Getting Billions In Bailouts

OBAMA BOUGHT HIS UNION ALLIES SOME CAR COMPANIES

After The 2009 Auto Bailout, The United Auto Workers Union “Was Given An Ownership Stake In Chrysler And Became One Of G.M.’S Largest Shareholders.” “In the industry restructuring that followed the auto rescue of 2009, the U.A.W., long a major contributor to Democrats, was given an ownership stake in Chrysler and became one of G.M.’s largest shareholders. Pensions of some union members and retirees were left intact, while salaried, nonunion employees took big hits.” (Jeremy Peters, “Auto Workers Tap Network For Obama,” The New York Times, 2/24/12)

  • The UAW Now Owns 41.5 Percent Of Chrysler And 10.3 Percent Of GM. “The Center for Automotive Research reports that the union trust fund now owns 10.3 percent of GM’s shares, while the U.S. Treasury owns 32 percent, and public shareholders own 35.2 percent. Italian automaker Fiat owns 53.5 percent of Chrysler, while the union trust owns 41.5 percent.” (Josh Hicks, “President Obama And Crony Capitalism: Examining Mitt Romney’s Claims,” The Washington Post, 2/20/12)

The Washington Post’s Fact Checker: “It’s Fairly Clear That The President Gave Precedence To The Union” In The Auto Bailouts. “In terms of the ‘sweetheart deal’ for the UAW, it’s fairly clear that the president gave precedence to the union and its blue collar members, who fared better than they would have been under Chapter 11. Meanwhile, scores of employees from the white-collar ranks are angry about cuts they had to accept. We won’t judge whether Obama’s stance was appropriate, but we can say that he came down on the side of the Democrat-friendly UAW.” (Josh Hicks, “President Obama And Crony Capitalism: Examining Mitt Romney’s Claims,” The Washington Post, 2/20/12)

  • Obama Forced Bondholders To Take A Backseat To The UAW. “That was the real issue for the White House because of its potential damage to union labor. So it proceeded to orchestrate an out-of-court prepackaged bankruptcy. Bond holders would have taken a severe haircut no matter what, but Mr. Obama's force majeure subordinated their rights to the UAW's.” (Editorial, “Halftime In Detroit,” The Wall Street Journal, 2/25/12)

UAW Received $10 Billion In Assets, $2.5 Billion Note, $6.5 Billion Preferred-Equity Stake, And As Much As 20 Percent Of GM Shares Over Time. “Now, GM plans to give the UAW $10 billion in already-set-aside assets, a $2.5 billion note, a $6.5 billion preferred-equity stake and 17.5% of GM's shares with the option for up to 20% over time.” (John D. Stoll, Jeff McCracken, and Neil King Jr., “GM-Union Deal Raises U.S. Stake,” The Wall Street Journal, 5/27/09)

  • “In Addition, The UAW Will Get A Seat On GM's Board.” (John D. Stoll, Jeff McCracken, and Neil King Jr., “GM-Union Deal Raises U.S. Stake,” The Wall Street Journal, 5/27/09)

NOW AUTO UNIONS ARE RETURNING THE FAVOR BY TRYING TO BUY OBAMA AN ELECTION

Obama Owes A Lot To Organized Labor For Helping Him Get Elected. "The Obama administration owes organized labor a lot for its victory in the presidential election, Vice President Biden said Tuesday, and will continue to push for the Employee Free Choice Act (EFCA) and other union-backed measures. 'Everybody looks back on the election now and says it was a piece of cake,' Biden said during a speech before a conference of the American Federation of State, County and Municipal Employees (AFSCME). 'But let me tell you: You made it cake.'" (Michael O'Brien, "Biden To Labor Group: We Owe You," The Hill, 5/12/09)

  • Vice President Biden To Union Bosses: "[W]e Owe You." (Michael O'Brien, "Biden To Labor Group: We Owe You," The Hill, 5/12/09)
  • "Biden Also Suggested That As Long As The Obama Administration Has Labor's Support, The Administration Will Support Labor." (Michael O'Brien, "Biden To Labor Group: We Owe You," The Hill, 5/12/09)

“The United Automobile Workers Union, A Primary Beneficiary Of President Obama’s Decision To Rescue Domestic Carmakers, Is Now Trying To Return The Favor.” (Jeremy W. Peters, “Auto Workers Tap Network For Obama,” The New York Times, 2/24/12)

  • UAW President Bob King: “We Plan To Be Very Active In This Election” To “Help President Obama Get Re-Elected.” “‘We plan to be very active in this election,’ Mr. King said in an interview. ‘We’re building a broad coalition that we hope will help President Obama get re-elected.’” (Jeremy W. Peters, “Auto Workers Tap Network For Obama,” The New York Times, 2/24/12)
     
    • UAW Officials Are Collecting Donations And Organizing Events For The Obama Reelection Campaign. “Other officials are busy raising money for the U.A.W.’s political fund. And a new online organizing network for the union, called Gimme Five, is constantly adding new members, who are notified by text message and e-mail about events like Friday’s protest, a joint effort planned with a local Democratic Party group.” (Jeremy W. Peters, “Auto Workers Tap Network For Obama,” The New York Times, 2/24/12)

UNFORTUNATELY IT’S THE AMERICAN TAXPAYER THAT’S STUCK WITH THE CHECK

PROMISE: President Obama Said, “We Are Going To Get Back All The Money That We Invested In Those Car Companies.” (ABC’s, “The View,” 7/28/10)

FAIL: The Government Now Expects To Lose $23.6 Billion In The Auto Bailouts, $9 Billion More Than Its Previous Estimate, An Increase Of Over 50 Percent. “The Treasury Department dramatically boosted its estimate of losses from its $85 billion auto industry bailout by more than $9 billion in the face of General Motors Co.'s steep stock decline. In its monthly report to Congress, the Treasury Department now says it expects to lose $23.6 billion, up from its previous estimate of $14.33 billion.” (David Shepardson, “U.S. Boosts Estimate Of Auto Bailout Losses To $23.6B,” The Detroit News, 11/14/11)

  • The Total Cost Of The Auto Bailouts Now Totals $79.6 Billion. “The Treasury now pegs the cost of the bailout of GM, Chrysler Group LLC and the auto finance companies at $79.6 billion. It no longer includes $5 billion it set aside to guarantee payments to auto suppliers in 2009.” (David Shepardson, “U.S. Boosts Estimate Of Auto Bailout Losses To $23.6B,” The Detroit News, 11/14/11)
  • FactCheck.org: The President Is “Sounding Very Much Like A Used Car Salesman” When He Describes The Success Of The Auto Bailouts. “Notice the president — sounding very much like a used-car salesman — used the phrases ‘during my watch’ and ‘under my watch’ when describing the TARP loans as being ‘completely repaid.’” (Eugene Kelly, “Chrysler Paid In Full?” FactCheck.org, 6/6/11)

Obama Administration Recorded $1.3 Billion Loss On Chrysler’s Bailout. “The government booked a $1.3 billion loss on its $12.5 billion bailout of Chrysler.” (David Shepardson, “Treasury Ups Auto Bailout Loss Estimate,” The Detroit News, 1/30/12)

Congressional Oversight Panel: “To The Extent That Success Is Defined As A Return Of Taxpayer Money, It Remains Somewhat Unlikely That All TARP Funds Invested Will Be Returned.” (“The Final Report Of The Congressional Oversight Panel,” Congressional Oversight Panel, 3/16/11)

  • COP: “Even If TARP Funds Are Fully Repaid, The Government’s Intervention In This Industry May Have Lasting Effects.” (“The Final Report Of The Congressional Oversight Panel,” Congressional Oversight Panel, 3/16/11)
  • COP: It Is “Unclear Whether The TARP Will Ultimately Reverse” The Domestic Auto Industry's Downward Trend. “The domestic automotive industry was trending downward before the financial crisis hit and it is unclear whether the TARP will ultimately reverse that trend in the long term.” (“The Final Report Of The Congressional Oversight Panel,” Congressional Oversight Panel, 3/16/11)

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