Repeating Obama's lies does not make it true.
then let's now compare the truthiness of your own version of events
Obama's plan was the government buying into GM, taking GM stock, to end run around bankruptcy laws to stiff all creditors and stockholders on behalf of the union.
actually - and this is significant - it was dubya who funded the GM bailout
it was left up to Obama to institute provisions for GM to use the money it had already been given
it was left up to Obama to figure out how to get GM to the point it would be able to repay that debt to the American taxpayer
so far, the truthfulness of your version is not holding up against the light of reality
This trashed the value of GM stock when it was no longer backed by bankruptcy laws at least minimally protecting investors and why GM is already going broke again.
the value of GM stock had diminished to nothing when that corporation became reliant on taxpayer dollars to remain in operation. that occurred before Obama was sworn in
second. bankruptcy laws do NOT back stock values
bankruptcy is what one faces when its ability to pay its just obligations no longer exists
investors in any stock are taking a risk
those who were invested in GM saw their investment value plummet because they had invested in a company which was poorly managed, such that it could no longer meet its debt service obligations
in short, GM was a net debtor and its balance sheet revealed that there was no equity for the extant shareholders. Obama had NOTHING to do with that reality
so, it appears your narrative remains a piece of fiction
Romney's plan was for GM to go thru traditional Chapter 11 bankruptcy and then reorganized by private capital assured by the US government.
that could not have been romney's plan because romney is too smart to not understand how the bankruptcy courts operate, and that description screams of one being ignorant about the ways of bankruptcy activities. so, again, the truthiness factor of your presentation is beyond lacking
i will explain what is wrong with your statement so that you will not think i am blowing smoke
when a business files for a chapter 11 (reorganization) bankruptcy, it does so in an attempt to put its creditors at bay long enough for a reorganization plan to be approved by the court
what we know is that there was NO private capital willing to invest in GM as it entered the unpredictable environment of bankruptcy court
had such private investment been available, there would have been no need to infuse GM with taxpayer money. that reality should again illustrate why your version must be found bogus
That is the most certain of loans to get because the lender cannot lose
why does it make sense of the government to capitalize GM via private institutions? this is another situation where the profits to the private lenders would be privatized if realized, but the losses would be socialized and absorbed by the taxpayer
i can see why you would think such would be romney's plan
but that is not what happened
dubya's administration threw a bunch of money at GM and left
- meaning GM would get the money,
yes, GM got the money, but it was received from a bush regime on the way out the door. there were no private investors willing to bet a huge amount of capital on an auto manufacturer that just became a bankrupt debtor right at the "height" of the financial meltdown
would have shaved off many debts,
that is not how accounting works
the debt would not be shaved. it would at best be the same as it had been, only owed to other creditors, and very likely the amount of debt would have increased by the amount on new capital required to give the bankrupt debtor time to reorganize
for example, if the company has $1 billion in current/past due obligations to existing creditors and the government infuses $1 billion to pay those current and delinquent obligations, that $1 billion due the first creditors is extinguished upon the repayment to them. however, the $1 billion borrowed to enable such payment becomes a new financial liability of the company. in that example, the company's net worth remained unchanged
the point being that it would NOT have 'shaved' off any debt
and in fact GM received from the taxpayer money which exceeded what was required to pay current and delinquent obligations. it received the additional money as working capital to survive while it reorganized to achieve profitability
and the stock value restored.
this cannot be possible
the stock of the original shareholders became worthless once the amount GM owed exceeded GM's ability to pay. that shareholder equity which once existed was dissipated by the auto maker's losses
again, take note how your far fetched description has no relationship to reality
Obama's plan was not about protecting GM. It was about sidestepping US bankruptcy laws for the unions.
Obama inherited the mess from the shrub, not unlike the economy in general
what he did was monitor GM's actions in such a way as to maximize its ability to survive to repay the money the taxpayers had provided to GM as a bailout
NO bankruptcy laws were sidestepped
but if you insist they were, please list them so that this discussion can be continued
