Hepcat-in-Chief Obama lost a bit of his storied cool yesterday in attempting to blame a group of recalcitrant hedge funds for the failure of the Chrysler deal his apparatchiks were working out. This is nonsense, and a lawyer for the hedge funds got it right with this statement:
"It sounds like people are being bullied right now," said Ron Geffner, a partner at the law firm Sadis and Goldberg, which represents hedge funds. "To play the 'I stand with Chrysler, I stand with families, I stand with the dealers, I stand with the consumers' -- that's great conceptually, but . . . I stand with the fact that we live in a capitalist society where companies who don't modify their business plans and stay current die and go by the wayside."
We are a nation of laws, not men. We have laws that govern the orderly dissolution of businesses, and those laws speak to how debt is retired. The senior debt holders (in this case, the hedge funds) will be paid out before any of the simple equity holders, and that is as it should be and as it has been under settled bankruptcy law. For the President to seek to stick it to the hedge funds so that bloated unions and ineffective managers can continue to conspire to run a bad business (with government as a full partner) strains credulity.
What we have before us is a bankruptcy case, and it should proceed accordingly. The President's demagoguery on the matter is not helpful, and it continues to bolster his growing reputation as anti-business.