Thursday, October 21, 2010

Detroit Economic Club cancels disgraced car czar Rattner

Appropriately, the thuggish face of the Obama Administration's auto task force — the aptly named "auto czar," Steve Rattner — is now up to his neck in legal soup. With charges of financial kickbacks sullying his name, Rattner's triumphal return to Detroit to promote his tell-all book about his reign over the Detroit auto bailouts was canceled this week.
His host, the Detroit Economic Club, was not willing to hold its nose.

The Democratic czar has been disgraced by reports that he has settled with the SEC for $5 million for lying about an illegal kickback scheme he concocted while managing public pension funds. In short, his firm, Quadrangle, bribed key pension fund officers in order to get their business. "His settlements with the S.E.C. could reduce the chances of prosecution," reports The New York Times.

Funny. . . isn't the Democratic 2010 campaign theme that Republicans bilked Main Street in favor of Wall Street?

Rattner's legal troubles were too much for the Economic Club, but Rattner has a history of playing fast and loose with the law while running with the fast and loose Chicago crowd of President Obama. A year ago, in an outrageous abuse of bankruptcy law, Rattner trampled the legal rights of secured investors in order to hand Chrysler over to the Democrats' preferred investors, the UAW and Fiat.

Some secured bondholders — many of them big Democratic Party donors — refused to accept a mere 29 cents on their investment dollar ("an offer they couldn't refuse," as Don Corleone might have observed). That's when Rattner's goon squad, according to the lenders' lawyer, Tom Lauria, reminded the holdouts how difficult life can be for anyone who messes with Washington. One investment fund, Perella Weinberg, immediately buckled, Lauria told the website Business Insider, "under threat that the full force of the White House press corps would destroy its reputation if it continued to fight."

Michael Barone called these tactics "gangster government." Financial analyst and law professor Glenn Reynolds called it "waterboarding bondholders." "We might expect this behavior from Hugo Chavez," said George Mason law professor, Todd Zywicki.

But it was all in the good service of the Obama Mob and its Big Labor backers.

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