Senator Corker calls the car company takeover “a power grab.” And it also seems to be a grab for the mere sake of asserting the government’s muscle. If this report is to be believed, then this is all an elaborate charade to hide . . .  yes . . . a good old fashioned bankruptcy proceeding:

The Obama’s administration’s leading plan to fix General Motors Corp. and Chrysler LLC would use bankruptcy filings to purge the ailing companies of their biggest problems, including bondholder debt and retiree health-care costs, according to people familiar with the matter.

The move would in essence split both companies into their “good” and “bad” components. The government would like to see the “good” GM to be a standalone company, according to an administration official. The “good” Chrysler would be sold to Fiat SpA, assuming that deal is completed, this person said.

GM and Chrysler have had bankruptcy attorneys devising plans for such a move in recent months.

President Barack Obama’s task force has told both companies that the administration prefers this route as a way to reorganize the two auto makers, rather than the prolonged out-of-court process that has thus far frustrated administration officials.

So if they are going to use bankruptcy to “cleanse” debt and rewrite labor agreements why not, you know, just do it? Why make this all about the president throwing his weight around and personally firing the head of a major corporation? You got me. Perhaps there is some hidden economic rationale or required bargaining ploy, but it seems that President Bush and then President Obama should have pointed these companies to the bankruptcy courts some time ago, spared the tax payers billions, and gotten started on the needed restructuring. But that wouldn’t place the president in the center of the action, I suppose.

At some point it becomes clear that this administration’s main goal is not recovery but the elevation of the government, and of this president in particular, above all other economic players. Some would say it’s bold. Others would say it’s the road to tyranny.

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This entry was posted on Monday, March 30th, 2009 at 4:53 PM and is filed under Contentions. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.