If you listen closely, you can hear the screams beginning:
Members of the business community today are starting to sound off in opposition to President Obama’s new plan to crack down on offshore tax evasion, denouncing the initiative as a “foolish” program that would do more harm than good.
Critics argue the president’s effort to raise taxes on the overseas profits of U.S. companies could damage U.S. multinational corporations.
“His proposals would put American corporations at a great disadvantage, which is a very foolish policy in a competitive global marketplace,” said Dan Mitchell of the Cato Institute.
Announced earlier today, the Obama administration’s two-part plan would remove tax deductions for companies that take jobs overseas and reduce the amount of taxes lost to overseas tax havens.
“If financial institutions won’t cooperate with us, we will assume that they are sheltering money in tax havens and act accordingly,” Obama said in announcing the plan today in Washington, adding that the government will also hire 800 new IRS agents to enforce it.
Not only is closing these loopholes the right thing to do, but it should be fun watching the Republican party and the entire right-wing blogosphere coming out as objectively pro-corporate tax cheats and pro corporate tax loopholes. Should be fun.
Tom65
Would this be the same Cato Institute that advocated privatization of Social Security funds?
Yes? STFU.
schrodinger's cat
I am sure this is driving the Corner around the bend.
passerby
Yes, re-stock the popcorn. We’ve already got ’em coming out for torture (not funny), but, their “up with tax cheats” ought to provide lots of laughs.
Plus, Obama announced that he was sending in an army of 800 additional tax agents to handle this. Take that! tax evading bitches!
Rainy
Besides low taxes, these corporations would rather pay us 5 bucks a day without healthcare and benefits.
Bulworth
Maybe the teabag partiers can get on this.
Gus
Well you see the argument they’ll make. This will somehow make U.S. companies uncompetitive. Many people will swallow that hook, line and sinker.
John Cole
I’m particularly interested in watching the freak out at Reason.
Speaking of, here is the formerly sane Matt Welch just repeating whatever the hell the Hedge Fund manager lawyers say. Funny, you would think someone who spent as much time in LA would remember OJ’s lawyers saying he was innocent.
Reason is such a damned joke anymore, and it upsets me.
Mike G
Did Obama get around to closing the hedge fund loophole — where those assholes take their pay as ‘capital gains’ with a 15% tax rate?
asiangrrlMN
No, you have it all wrong. The right are PRO-AMERICAN BUSINESSES*, and this will just cripple those businesses. Cripple them, I say. Yeah, whatever.
You know, I am to the point that if a corporate advocate said it was in the best interest of businesses to be taxed at a higher rate, I would be calling for lower tax rates for businesses.
*making as much as they can while paying as little as they can–not even a living wage if they could get away with it. It’s the American way, don’t you know. Free market and whatnot.
Comrade Darkness
Awesome. Can we please have this as a reality teevee program so I can breathe in the bitter scent of their tears even more deeply?
slag
Why do libertarians and Republicans think that American businesses are so weak that they can’t innovate within constraints? Shouldn’t multinationals stop whining and just pull themselves up by their bootstraps?
Republicans and their soft bigotry of low expectations.
Sloegin
Would be fun if it weren’t for the fact that they’ll probably win.
Zifnab
It would be a great disadvantage if we were forced to pay our taxes like any of those other “little people” businesses that reside state-side.
And if you close down our legal tax shelters, we’ll just be forced to spend more money and more labor opening up new tax shelters, some of which may not be legal at all. This would deprive the US of revenue over the long run and raise overhead costs in the short run.
Furthermore, the costs on the US Government and on the various corporations in the ensuing legal conflict would be astronomical, as you know mega-corps will be fighting this tooth and nail till they can wedge a Republican back into office.
So please, for the good of the nation and its sweet happy wonderful economy which we love, we implore you to let us remain in tax obscurity. Do it or we’ll call you a super Muslo-terrorist.
scav
think of as a shovel ready project for lawyers! Ah, sweet screams……
DougL (frmrly: Conservatively Liberal)
So our new President created 800 new jobs today?
Excellent!
Dungheap
I imagine what will happen is some horse-trading by the remaining moderate Republican Senators (all 2 of ’em!) and the Democratic mushy middle that results in a closing of tax loopholes together with a reduction in the corporate tax rate.
In the end, the Republicans vote against it en masse, essentially voting against tax cuts and in favor offshore corporate tax havens.
I don’t think they get how Obama plays the game quite yet.
Billy K
Obama sure is making a lot of enemies (CIA, ginormous corporations, unhinged gun-nuts). It seriously worries me.
Thankovsky
They’re setting themselves up for such a kick in the balls on this one. They don’t have much of a choice, though, quite frankly; either they alienate the most-important part of their base, or they alienate everyone else. The GOP has really managed to back itself into a corner on this one.
robertdsc
Pro-business Dems in the Senate will kill this.
LD50
Oh come on. We all know which one they’ll pick there.
James K. Polk, Esq.
This Blackie-X Obama guy is damn good.
Michael
Cato tears taste like puppy kisses…….
JenJen
@John Cole: It drives me crazy when Matt Welch writes stupid stuff. It just feels more painful when you know for a fact the writer is whip-smart, you know?
Just heard Mitch McConnell on TV, saying the President is “pro-foreign companies only.” I guess that’s they’re line, and they’re gonna stick with it.
MikeJ
Corporations only exist to allow people escape personal responsibility. Of course republicans love them!
Incertus
@DougL (frmrly: Conservatively Liberal): Yeah, but they’re government jobs, so they’re not really jobs. /Michael Steele
Thankovsky
@Billy K:
I wouldn’t say he’s made an enemy of the CIA yet. It all depends on how carefully he handles the prosecutions issue. One thing to keep in mind is how unpopular Bush was with a good portion of the intelligence community. He didn’t pay attention to the CIA when they told him that there was no al-Qaeda/Iraq connection, and yet they’re the ones taking the heat for it. Obama is doing a good job of demonstrating that he appreciates the intelligence community and will take the whole of their recommendations more seriously than his predecessor. If he can keep doing that, and at the same time prosecute the worst of the torturers and torture-lawyers without looking like he’s carrying out a witch hunt, I think he’ll still be able to maintain a decent relationship with the CIA.
Which is good, because a lot of his foreign policy is going to depend upon their being helpful.
Michael
How can they go Galt if they can’t shovel money out of the country?
Incertus
@robertdsc: Probably, once they get cover from the Villagers to do it.
AnotherBruce
Because you know that if we close corporate loopholes for foreign tax shelters, businesses will have to ship our jobs overseas, bust unions and get rid of our pensions and health care benefits.
Oh wait…. they already did that.
Politically Lost
Don’t buy those popcorn futures just yet. As we saw with the cramdown legislation, the congress is a wholly owned subsidiary of just one tax haven. Get it through congress before any celebratory high fives.
JM
This is not new spin. The WSJ was casting tax-havens as an example of “economic competition.”
yeah
demkat620
Oh what fun! Wait until they are shocked, shocked I tell you that they can’t get any sympathy from working Americans. See, kids, this is how you do it. You put your apposition on the wrong side of every issue early.
passerby
I caught the Obama/Geithner announcement on C-Span. They both speak, short and to the point, with a pretty confident air. The clip is 10:36.
Hope the link works. (and hope the reform passes.)
John Cole
@JenJen: He is putting out so much nonsense I’m re-evaluating how smart he is.
Shawn in ShowMe
Fixed.
Ash Can
Yeah, this’ll put them way behind those foreign corporations — you know, the ones that are so horrifically overregulated by their Commie Pinko governments and which stand as paralyzed, crippled monuments to what our Good Uhmerrican Bidnesses should never do, for fear of being thoroughly trashed by Teh Sozzializm like them…
Fuck, my brain hurts from writing this shit…
jake 4 that 1
No, no. The best part will be watching what happens after they come out in favor of offshore outsourcing. Those of you who are upset by the sight of blood are urged to look away.
Miriam
I agree with Politically Lost, unless Obama can make these changes by executive order, this initiative has about as much chance of passing as cram-down.
And offshoring jobs is just part of Free Trade – its un-American to be against Free Trade.
The conservatives still have the power in Washington D.C.
TenguPhule
Today Tax cheats, Tomorrow Puppy Kickers.
When will the tyranny end? /wingnut
gnomedad
@passerby:
Liddy will know what to do.
Michael
As somebody who used to occasionally set up offshores for liability protection, here’s how it works:
1. You set up your offshore bit in the Caribbean, or the Isle of Man, or Panama, or Pitcairn, or Jersey, or any one of dozens of (primarily British Crown Colonies or Commonwealth Nations).
2. You get a tax free haven, so long as you commit to performing no business there, other than shuffling your money.
3. Barclays and Scotia have branches in all these places.
4. You can draw funds off those accounts everywhere in the world from those banks, but the info on those accounts is firewalled within the borders of the jurisdiction you established them in.
4tehlulz
>>Just heard Mitch McConnell on TV, saying the President is “pro-foreign companies only.”
But American car companies deserve to die….
Cris
Why shouldn’t they? In the world of working-class Republicans, you’re not a laborer, you’re a rich business owner who simply doesn’t own his own business yet. The GOP has managed to hypnotize the people they’re screwing over into believing they are actually the overclass-in-waiting.
fledermaus
Are these whiners the same bunch in this post?
Zifnab
@JenJen:
That makes perfect sense to me. If a multi-national corp hires people in India, pays them in India, sells the product/service through a US dealer, and keeps the lion’s share of the profits in India, the President would do well to think about the interests of this “domestic” company he’s hurting.
passerby
@Politically Lost:
This is a good point and raises the question in my mind about how the law about offshore tax havens for corporations is currently interpreted. Obama suggested and IIRC actually used the word scam (or was it fraud) when referring to the current situation during this morning’s announcement.
So the congressional debate may become about changing the rules to legalize this behavior. (???) Don’t know.
TenguPhule
Because they think everyone is like them.
SATSQ.
El Cid
Maybe Obama could remind the zombie worshipers that Reagan’s 1986 tax reform ushered in the largest corporate tax hike in U.S. history, based entirely upon closing loopholes.
This is just closing loopholes for traitors who hate America but want to profit off our consumers. (How ya like them apples?)
DougL (frmrly: Conservatively Liberal)
@Incertus:
You’re truly channeling the wingnut vibe there d00d…
Scary. ;)
El Cid
Hey, would this be a good time to tell them that any electronic surveillance gathered by a government security agency can be shared with another government agency in relevant criminal investigations — i.e., they righties just spent the last 8 years of Unitarded Executrix worship enabling the IRS to spy on them?
Ash Can
@El Cid: These people are doing good if they can think past their next meal.
Comrade Darkness
@robertdsc: Make a list, the calls start now.
Unpatriotic bastards. *Takers* of government services.
Olliander
This really had nothing to do with the hedge-fund loophole. The Chrysler issue had to do with creditors lien positions.
These hedge-fund investors (who took NO TARP money) abided by the law and were in a first secured position against Chrysler’s assets. But the government has decided, to hell with contract law, and the hedge-funds, which have legal right to those claims, got the shaft. Not to mention millions of retirees’ assets, retirees who invested in Chrysler corporate bonds for their retirement.
I guess trashing the law of the land is palatable only when you’re a Democrat.
kay
@passerby:
The links works, and thank you. Geithner sounds fairly convincing as a populist.
I flipped through Geithner’s calendar. The NYTimes printed it He works really hard, unsurprisingly.
I thought it was a little sad, though. He has 15 and 30 minute meetings, back to back, most days, beginning at 6:30 AM and ending at 7:30 PM.
Then, beginning in January, he starts attending something called “media training”. Also, “mock hearing”. Poor thing.
Tsulagi
Umm, not so sure. For some of the more brilliant among them, they could see an opportunity just waiting to be seized. Or suckled by the more considerate.
Since they’ve tasted teabagging and are now yearning for more, could expect them to put on some tea party get-togethers in support of tax cuts for patriotic businesses exporting jobs and capital. The Bush admin said outsourcing jobs was good for America. Because as with taxes, less jobs equals greater income.
Only stupid soc ialists would think differently. Even Morans Guy now busy hanging tea bags as ornaments on the tinder-dry Xmas tree next to the BBQ in his living room could tell you that.
Drive by Wisdom
Predictions:
1) more corporations move headquarters offshore
2) corporate tax revenues fall
All for some quick populist adulation.
Next up? Mr. Obama’s NIH wonders why gays in Argentina go to gay bars do gay things:
http://www.cnsnews.com/public/content/article.aspx?RsrcID=47523
These peope are rocket scientists.
kay
@Olliander:
Well, now they can battle for Chrysler’s dwindling assets in bankruptcy court.
Since they’re secured, and all. I don’t see the problem. The trustee will sort it out.
They were holding out in hopes of another bail-out, and Obama called their bluff.
Maybe they should have accepted the offer. Too late.
tc125231
@Mike G:
The Grand Panjandrum
@Drive by
WisdomWingnut: Shorter: Ooh look at me! I haz smarts.Comrade Kevin
cnsnews.com is about as reliable a source as Sean Hannity.
Xecky Gilchrist
@Drive by Wisdom: These peope are rocket scientists.
Physician, heal thyself.
Cris
@Drive by Wisdom: Galts are go!
robertdsc
I’ll go you one better: the President’s own email list now formed under the group Organizing For America. Where are they now? Certainly not applying citizen pressure where it’s needed most.
Sarcastro
Next up? Mr. Obama’s NIH wonders why gays in Argentina go to gay bars do gay things:
Ouch!
tc125231
@Ash Can:
Cris
@Sarcastro: If the Obama Recession could begin before he was even elected, so could his Wasteful Government Spending.
Zifnab
@Drive by Wisdom:
Raising taxes only lowers tax revenue! Giving tax cuts to rich people will encourage them to cheat less! We must burn our house to save it!
We’ve heard it all before, Wizkid. If Obama cracks down on tax cheats than the number of tax cheats can only increase, by the infallible logic of wingnutnomics. The only way to keep people from cheating on their taxes is to lower their tax brackets so low that they don’t mind paying anymore.
This, from the Law and Order Pro-Death Penalty 2nd Amendment crowd that doggedly insists the harsher and more aggressive the prosecution or deterrent, the lower the crime rate.
I guess threat of years in jail only intimidate poor people.
Calouste
@JenJen:
Which is why all the foreign car makers in the US have their plants in Illinois instead of Kentucky, South Carolina, Mississippi, Tennessee, Alabama, Texas and Georgia?
Not because of all the money that they got from state governments in the South?
Mnemosyne
@Olliander:
It’s against the law for a failing company to go into bankruptcy, so the administration should have prevented Chrysler from doing so? Huh?
gwangung
Apparently the minority of the creditors. Folks who held 10% of the secured debt. The folks with the other 90% were just fine with Obama’s position.
And those 10% could possibly be forced to go along the 90% when they do go in bankruptcy, so they’re pretty much gambling and spending court time and moneyon this.
JL
@Drive by Wisdom: Since the program to study gays started under Bush, you might ask the former President why he allocated grant money.
flounder
A few months ago, the wingers that comment at my local paper kept calling Democrats “tax cheats” because of the Geitner situation.
I started posting about how much of tax cheat CEO Dick Cheney of Halliburton and 90 some offshore subsidiaries was, how just because something was legal didn’t mean it couldn’t be un-American at the same time, and how none of them ever freaked over his sins.
I got some good, very convoluted answers as to why stealing from America is perfectly responsible. I doubt the big boys are going to do any better.
Tsulagi
@Drive by Wisdom:
Hard to tell which is funnier: Predictions by wingnuts or their thinking anyone would take them seriously given their track record.
@Sarcastro:
I’m guessing RedState lobbied the Bushies hard for that study in the hopes of having a better understanding or feel for Latin rough men at the ready.
Jay B.
@Olliander:
Blow it out your ass, drama queen. Obama has done exactly nothing to the hedge fund people except call them out. I guess obtuse observations and a perfectly-timed 8-year memory loss is only possible when you’re a Republican.
Dennis-SGMM
Next from the Republicans: “Americans’ taxes will go up by over $1100 for every taxpayer!”
($210,000,000,000/188,000,000 taxpayers)
And if I hear “This will hurt our competitiveness in the global marketplace” one more time I will probably hurl. If American businesses are uncompetitive it’s likely because the dumb bastards running them can’t think beyond the next quarter. And while I’m ranting, these are the same greedy, shortsighted, sons-of-bitches who cry about how costly it is to employ Americans after fighting Universal Health Care tooth and nail for years.
JL
The stock market reacted negatively today upon hearing the news that Obama was going after tax cheats. Instead of rising 500 pts. like most investors thought, it only gained 214 pts.
How did I do? I too can be a whacko.
gwangung
Hm. Foreign competitors “hobbled” by universal health care and the like.
And the bastards STILL can’t compete? Wouldn’t that make these captains of industries utter morons?
The Other Steve
Completely off topic, but someone had an awesome letter to the editor in yesterday’s newspaper…
Dennis-SGMM
@gwangung:
If Congress reinstated involuntary servitude it would take the captains of industry about four quarters to begin making the case that only the reinstatement of slavery would make them competitive in the global market.
Olliander
Majority rules is not how liens work. The 10% holders were first priority liens—they were senior creditors. They get top priority. Until now.
The White House—yes, the WHITE HOUSE, determined that it was beneficial for a certain auto union to be brought ahead of the line, for what? Since when does the White House make these determinations? To essentially void a legally binding contract with no strings (again, the debt holders in question received NO TARP money)?
Again—abuse of power for me but not for thee…
asiangrrlMN
@The Other Steve: Full of win! Hee hee.
@Dennis-SGMM: And, god forbid, they take a teeny-weeny cut in their own salaries….
Badtux
Olliander, the UAW is getting a chunk of Chrysler in exchange for giving up the tens of billions of dollars that Chrysler owes them. The UAW was in front of even the “secured” creditors because pension obligations come out in front of all other obligations in a situation like this where the pension fund has been looted by management. Your bashing of labor unions is tiresome and old and your assertion that pension funds that invest via hedge funds are somehow more entitled than pension funds run by auto unions makes about as much sense as any other Republican anti-worker drivel.
Dennis-SGMM
Well, dumbass, it could be because before the BK was announced the UAW swapped a ten billion dollar payment that Chrysler owed its pension fund for a 55% stake in the company. Don’t let facts dissuade you though: it’s the conservative way.
Edit: Badtux beat me to it. Curse my arthritic typing thumbs!
Woodrow "asim" Jarvis Hill
Conveniently, I just discussed this elsewhere:
Well, let’s look at the FAQ on this exact subject — Chapter 11 Bankruptcy — from the official US Court System website. In it’s Bankruptcy Basics section, it says:
It is Not the Law that “secured creditors” always get paid first; even the complaining group, in their press release on this issue, notes that it is, rather, “long recognized legal and business principles [that] junior creditors are ordinarily not entitled to anything until senior secured creditors like our investors are repaid in full.”
And then, in the very next sentence, they note that they had already “offered to take a 40 percent haircut even though some groups lower down in the legal priority chain in Chrysler debt were being given recoveries of up to 50 percent or more and being allowed to take out billions of dollars.”
So no, it’s only a general legal sense that secured credit wins out first; [bankruptcy] negotiations can, and do, change that aspect. One presumes this is why the actual laws, summarized in the above section, do not comment on this. Secured creditors do have other legal rights, as noted in the FAQ.
[To the original comment — the ENTIRE POINT of Bankruptcy is to render existing contracts null and void, and to re-negotiate under different terms.]
Shawn in ShowMe
Where is it written in the bankruptcy code that small creditors get precedence over much larger creditors?
TenguPhule
Also known as bankruptcy.
asiangrrlMN
I love it when people more knowledgeable than I (in this case, comments #82-86) succinctly explain the fallacies in GOP logic. Thanks, guys! I like it when I learn the reasons behind why things happen the way they do.
HitlerWorshippingPuppyKicker
Olliander is a spooftroll.
kay
@Olliander:
I know what you’re saying. I know you’re saying the hedge fund owners were prior. I know they have a secured position that’s prior.
Who is the debtor in possession lender? What is the asset the debt is secured WITH?
Answer those, and you’re getting close to understanding why what you’re saying is an ill-thought out talking point.
I read the talking point too. It’s bullshit, and if you know as much about bankruptcy as you’re pretending to here, you’d have figured it out by now.
Use your head.
Jess
@The Other Steve:
That is an awesome letter–can we invite Amy to Balloon Juice to play with us?
Phoebe
Do you remember during the campaign when Obama would say, in a lot of speeches, that he was going to need people – citizens, the public – behind him on certain stuff if he was ever going to have a prayer of getting it done? I think this is going to be one of those things. Because if this is not done with a lot of public fanfare and spotlight, then a ton of corporate sponsored politicians would vote against it -Rep and Dem.
The only hope we have is if they know we’re paying attention, and they are called upon to state their positions and justify them ahead of time. Particularly the Dems.
Zam
@JL: I give it a 7, 10 points if you manage to argue how the stock market going up is actually a bad sign.
gwangung
THis is not necessarily the case, according to what I’m reading.
gwangung
THis is not necessarily the case, according to what I’m reading.
Shawn in ShowMe
And besides being bullshit, it’s null and void. The four largest holders of Chrysler’s secured debt jumped on the government’s offer. The two remaining holdouts were left sucking their thumbs while their lawyer tries to build an entire case around the fact that they didn’t take TARP money. Good luck on that.
asiangrrlMN
@Zam: If the stock market goes up, people will become overconfident, and there will be another bubble which will then pop and ooze gooey slime over all of America again. Therefore, it’s best to keep the stock market prices down so people don’t lose their heads.
TenguPhule
1. If they move offshore, they’ll get taxed.
2. If they try to stint on their taxes, Jailtime!
kay
@Shawn in ShowMe:
Who bankrolled the possibility of a reorganization here?
The federal government is the debtor in possession guarantor, correct?
I mean, who are they kidding with this “we’re PRIOR”?
Prior to what? Liquidation?
kay
“The move with Chrysler signals to GM’s creditors that bankruptcy is a viable option. The government is not just going to throw money at this without getting a consensual accord”
That’s the bankruptcy lawyer for GM, today’s WSJ.
Obama called their bluff, Olieander.
Shawn in ShowMe
Unfortunately, Newt Gingrich, Steve Forbes and whoever Olliander got his talking point from is what passes for thoughtful Republicans these days.
kay
@Shawn in ShowMe:
The whole thing was such an incredible ruse. They didn’t take the offer, now regret it, and are going to whine for months.
We need more resilient and manly bidnessmen. Really. They’re just incredibly wussy.
DougL (frmrly: Conservatively Liberal)
Cris:
Hypnotize and mesmerize. One idiot Repub called into Washington Journal (C-SPAN, the topic was ending offshore tax havens) this AM and the moran said that the government is trying to steal the money that the rich have rightfully earned and are trying to protect from the greedy government. He further stated that if he was rich he would do the same thing.
They deride Obama about ‘hope’ and yet that is all that sustains idiots like this guy. Hope that one day their ship will come in and they too will be able to enjoy the perks of being a rich person in Amerika and leave the poor to pay for everything.
A lobotomy would only improve the IQ of idiots like this.
kay
@gwangung:
It IS how it works. He’s wrong. The government needed a 2/3 majority to force a cram-down. They had 70%.
The hedge fund holders knew it, too. They were waiting for a bail out.
someguy
The hedge funds have a good legal case that their debt – at least some of them own bonds secured by the physical plants – has seniority over the fed’s post-bailout stake. Forcing the holders of a secured interest in an insolvent company to fork over their bonds and accept an “equal” amount of common stock (q: what’s 30% of an insolvent company worth?) isn’t exactly a fair trade. It is literally something for nothing – unless one of you guys thinks that Chrysler is likely to be worth anything ever again. This is an emergency though, so I’m down with the president forcing the hedge funds (and their rich ass clients) to eat shit on their investments, just as long as everybody is cool knowing there isn’t going to be a whole lot of private investment coming from that sector in the future, not where the government can get its hands on any sunken money. Worst case scenario, the government and the controlling shareholder (UAW) shut the factories down and sell off the equipment, so the taxpayers get their money back and the union gets at least part of its unfunded liabilities covered.
The Very Reverend Battleaxe of Knowledge
@DougL (frmrly: Conservatively Liberal):
That’s it in a nutshell. Remember the outrage when, after getting a negative reaction at some political rally to his proposal to raise the maximum marginal tax rate (back) to ~95% (?) over $100,000, McGovern was overheard muttering: “They must think they’re going to win the lottery?”
That’s exactly it: these redneck douchebag morans all think they’re going to win the fucking lottery. McGovern was only 37 years ahead of his time.
That One - Cain
Oh man, I was reading the slashdot article on this and the libtarts were all running amok. I couldn’t believe they pretty much wanted no taxes on corporations. They have some seriously naive ideas and the Laffer curve is like their God.
cain
grumpy realist
I was wading into the swamp that consists of ABC comments on this above topic and it was incredibly obvious that nobody commenting had any idea of a) what goes on in a bankruptcy, b) the qualifications you need to be able to invest in a hedge fund, c) what “takings” are, or d) what the POTUS can or can’t do, legally. (Of course, now that Dimwit Jr. mutated the POTUS into the Unitary Executive position, I’m not so sure of the last myself.) Anyhoo…
Would everyone shrieking about “secured debt!” and “unsecured debt!” and “junior debt” vs. “senior debt” please calm down and go read a book on bankruptcy law or two? Yeah, for the *most part* senior gets dibs over junior, etc, but once you waltz through the doors of the court along with the other hundred similarly hungry (and lawyered-up) claimants and plonk yourself down in front of a judge, you don’t know where the Good Ship Bankruptcy will take you. What Obama et. al. were trying to do was get everything as settled as possible beforehand; the hedge funds now will have to take their chances in an arena where cramdowns *will* happen, where 70% of the players *can* impose their will on the other 30%, and the only ones who will benefit are the lawyers, charging by the hour while the remaining embers of Chrysler continue to get ever colder and more and more lifeless and more and more useless. At the end, the lawyers will walk away with the bulk of the $$, the UAW will get a bunch of worthless stock, and the banks and the hedge funds will be left with a bunch of cars and factories suitable only to sell for scrap, for much, much less than if they had decided to go along with the original agreement. Great work, Wizkids of Wall Street—you done us proud!
kay
@someguy:
I think that’s nonsense too. This idea that the government is just dying to swoop in and re-order debt, and so investors can’t rely on a secured position, so won’t take the risk of investing, is FOX News fodder.
How did it come to pass that Chrysler ended up needing a bail out?
Where were the hedge fund investor’s tears when the government was bailing out AIG?
They didn’t take TARP money directly. They benefited.
TenguPhule
Which was trumped by Union claims to have pension and health obligations funded.
TenguPhule
“Paying Taxes hurts American Companies!”
JFCNTZYM, these people are just dying to be lynched by street mobs.
The Very Reverend Battleaxe of Knowledge
@TenguPhule:
Exactly. This time, it’s going to be crystal clear exactly what they want, and the American people can see whether they like it or not.
That does not constitute a prediction that they won’t get what they want, or that the American people won’t be hypnotized into liking it, but that seems a little less likely this time around.
WereBear
It’s really on the order of sympathetic magic; the poor deluded Teabaggers actually worship Mammon, and when Mammon looks down and sees them sticking up for the rich, they will get smiled upon.
Mnemosyne
@grumpy realist:
Yep. That’s why the whining is getting to that high pitch that only dogs can hear. The holdout minority shareholders gambled that the government would rather do another bailout than let Chrysler end up in bankruptcy court and they lost. Now they have to start over at square one and probably won’t get as much as they would have if they’d taken the government’s deal. Whoops. Coulda shoulda woulda.
Charity
OT, but loving the new mobile friendly site. Thanks, gents!
liberal
@Mike G:
I don’t think so.
joe from Lowell
Funny, John: I saw your headline, and went over to Hit & Run to take in the spectacle.
Unfortunately, they’re still recovering from the shock, and don’t have anything up about this yet.
Oh, well. No sweet, sweet libertoid tears for me tonight. I trust that Matt “People who say there’s a recession are scaremongers” Welch will be frothing about the end of the world tomorrow morning.
God, that rag has gone downhill.
CeriConversion
@slag: Why do libertarians and Republicans think that American businesses are so weak that they can’t innovate within constraints? If you take their words seriously (which is of course a mistake), this is really a running subtext through a lot of conservative rhetoric: “We all suck.” Our businesses can’t compete if they have to be honest. We shouldn’t have health care for all, even though everybody else makes it work, because we’re all evil scumbags and would mess it up. On and on. If I thought that badly of Americans at large, I’d be in favor of serious education reform…but they say suck too much for that, too.
Chuck Butcher
A funny thing, the VIN plate on my Harley says “Proudly Union Made In The USA.
The proudly cleaned and modified In My Garage In NE OR USA carb isn’t providing gasoline and the beast won’t fire. Aggravated is a good word. I’m probably the only one here who gives a damn, but I thought I’d share…
seehearBL
Maybe I’m missing something (and maybe this was mentioned in the comments earlier), but I seem to remember Dubya openly mocking tax enforcement in the 2000 and 2004 campaigns, telling crowds (and I’m paraphrasing) that “rich people and corporations have enough money to hire good accountants to help them avoid taxes, so trying to enforce taxes on them is a waste of time.” Let that sink in: the President of the United States was saying that enforcing the law was basically a joke. And he didn’t pay any political penalty (and certainly our brave journalistic corps. never called him on it) for that position, and I can’t imagine it would be any different for the GOP now.
But here’s what really chafes my nads on this entire issue: the United States of America is the best place on Earth to do business BECAUSE of the infrastructure that was developed using federal income tax revenues. These Fortune 500 companies were able to grow into global behemoths BECAUSE of our federal aviation system, BECAUSE of our federal highway system, BECAUSE of our federal telecommunications system. Big companies and rich people do so well here because we have police, firefighters, national guardsmen and guardswomen to protect their interests and keep them safe from bandits, terrorists, thugs, and other miscreants. Sure, the Bahamas has more favorable tax laws, but they also don’t have the protections this nation offers. You gotta invest in the system to get something out of it. Period.
DougL (frmrly: Conservatively Liberal)
@Chuck Butcher:
Gas in the bowl yet not getting into the engine, like a plugged jet (pilot/main)? Many bike choke circuits tend to draw their fuel via the main jet and if it is plugged then you get nothing at crank w/choke.
DougL
It would be irresponsible not to speculate. Amirite?
Freedom Now
Why is that American firms are double taxed when they do business overseas and many European countries do not have such taxes?
In addition, unusually high American corporate taxes are a burden to businesses.
To fund the stimulus, other pork barrel projects and a bloated budget Obama advocates raising taxes even further on businesses.
This is not a matter of free market over a socialized economy… Its a matter of common sense in opposition to Obama’s inept and dangerous economic policy.