I'm very proud to be a Hoosier... and this reinforces it.
Three of Chrysler's secured creditors are mounting a fresh attempt to thwart the carmaker's Chapter 11 reorganisation on the grounds that it violates their legal rights and the US government's authority under the Troubled asset relief programme.
The three - all Indiana state pension funds...
SNIP
The Indiana funds say the current plan will strip their collateral into the new company, benefiting more junior creditors. The funds also allege that Tarp funds were meant to be funnelled only to financial institutions.
"Whatever powers the Treasury department may have under Tarp," the funds said, "it does not have the power to control the entire restructuring of a company to the detriment of the company's secured creditors and for the benefit of other interest groups so that certain broader policy and political objectives may be achieved."
Some days, I question the wisdom of our Federal system... other days, as in when the states serve as a check on the Federal government (rather than an impediment to good government), I really am happy that our system allows dissenting voices to appeal to the judiciary.
Here's hoping the courts realize just how badly the government's Chrysler plan will undermine the financial system in this country, and rule in favor of creditor's rights (also known as the rule of law). If you think about it, basically the federal government is forcing a transfer of wealth from one pool of citizens (in this case Indiana taxpayers and the constituents of those pension funds) to another (UAW workers) by elevating the UAW claims in the Chrysler capital structure.
