Tuesday, June 09, 2009

Are There Limits to Bailoutistan?

Justice Ginsburg puts the brakes on Obama’s pilfering Chrysler’s creditors, at least for the time being.

It’s nice to know that SCOTUS is at least going to think things over before allowing the administration to bend the bankruptcy process into one favoring politically connected insiders.

For Obama, the longer this drags on, the more details will come out, and the fact that the deal isn’t

I still doubt that the Court will muster the courage to tell Obama that there’s some things he just can’t do. Though the fact that the Solicitor General is busy arguing that the Supremes can’t rule on TARP (at least in the case at hand) may give them some incentive to do so, but there's the Kelo history that suggests that the Court really thinks that your property is only loaned to you by the government. When some bureaucrat thinks that it's in his interest to take it to enrich somebody else, they do so.

If the Obamakins get away with this, there’s an immediate short term payback to the unions. The UAW and their allies get access to more of the taxpayer’s money. Since it’s unlikely that Fiat has the technology, marketing skills, or quality control presence to get Chryslyer’s products up to the Ford / Hyundai tier, never mind about Toyota / Honda, more bailout dollars will be forthcoming. Especially if they’re coerced into producing environmentally correct Yugos.

Longer term, no one in their right mind will want to invest in a union company, or for that matter, where the Obama’s “sharers” can easily expropriate it.

Update: The Supremes back down. The “political” in “political economy” is officially ascendant.