Bailout Watch 415: Feds: Hakuna Matata as GM, Chrysler Blow Through Debt Swap Deadline

Robert Farago
by Robert Farago

Once the feds bailed out GMAC—despite the failed lender’s inability to meet federal regulations—there wasn’t an industry expert who seriously believed that GM could convince its bondholders and union reps to swap $30 billion worth of GM debt for $30 billion of worth GM equity. (No sniggering.) Who cares that the swap was required as part the conditions of the automaker’s $13.4 billion “emergency bridge loans?” Nobody. To its credit, GM played the requisite game of charades, holding “marathon” negotiations with the bondholders and union reps. To no avail. According to Dow Jones, Uncle Sam reacted to the missed deadline with a stern, “Never mind!” And “Chrysler LLC, which received a $4 billion loan, was subject to the same terms as GM and also failed to reach deals with the UAW or debtors, although talks still continue.” See? As long as they’re talking, there’s hope! So . . . back to your smoke-filled room! And no more deadlines for you, Mister! Obviously, there’s more important game afoot: the MSM feeding frenzy over the whips driven by the presidential automotive task force. Question: when did the media and our elected pols become such wimps, weasels, scoundrels and patsies?

Robert Farago
Robert Farago

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  • Psarhjinian Psarhjinian on Feb 24, 2009
    Psarhjinian blaming it on George Bush? I wouldn't say "blaming", per se. Certain administrations (Kennedy, Reagan, Clinton) were very good at steering the media, while others (H.G. Bush comes immediately to mind) were very bad at it. G.W. Bush's administration took that level of steering to a new level. The press' access to information was rationed to a degree that you typically didn't see before. You could make the argument that the Internet and cable news made the media easier to manipulate, because it made getting the news quickly a more immediate need. If you want to put it in crude terms, Clinton was a media darling, but Bush made the media his bitch. It was only when he became weak---around 2006 or so---that the media became accordingly more critical. Note that I don't have any love for the major media outlets, and as such I don't feel this is a condemning point for Bush. I don't like a lot of what he and his colleagues did, but for a good six years he and his staff did an impressive job of curbing the kind of magpie tendencies that's typical of the major outlets. What has changed is that their control over the news (which is not the same thing as control over the organizations that report the news) has lessened over the last decade with the rise of the internet and development of sites such as this. I agree with you to a point: the major media still has a lot of (possibly undeserved) credence, especially in certain demographics. It's especially true of older people, or those who depend entirely on push content. While the internet has broken that somewhat, I think the real tipping point will be the coming mass collapse of Big Media. If you think the business model of GM is broken, that of the likes of Fox or Time-Warner is only slightly less so. Give it a year or so and I'd expect several of these outlets to fold as their revenue streams dry up.
  • Wsn Wsn on Feb 24, 2009

    Robert Farago said: Question: when did the media and our elected pols become such wimps, weasels, scoundrels and patsies? Sherman Lin said: George Bush and Bill Clinton both played and manipulated the MSM like the patsies they are. But then again every President does. Bill Clinton was being impeached for a blow job. No one tried to impeach George Bush when he violated the constitutional rights of American people (those who tried probably ended up in Guantanamo). That's when.

  • Wsn Wsn on Feb 24, 2009

    psarhjinian : While the internet has broken that somewhat, I think the real tipping point will be the coming mass collapse of Big Media. If you think the business model of GM is broken, that of the likes of Fox or Time-Warner is only slightly less so. Give it a year or so and I’d expect several of these outlets to fold as their revenue streams dry up. I totally agree. Technology is the fundamental game changer in politics.

  • Gogogodzilla Gogogodzilla on Feb 24, 2009

    To wsn: Clinton wasn't impeached for a blow-job... he was impeached for lying about it. It he had testified, under oath, that yes... indeed he had gotten a blow job, the storm would've 'blown' over.

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