Thursday, May 07, 2009

Obama Kills the Rule of Law

The "Rule of Law" is a foundational principle upon which America's entire legal system is built. It means that a court renders its decisions based on already-established principles, applied without discretion. This principle prevents arbitrary governance based on the whims of judges or politicians. This is what makes America "a nation of laws, not men."

With the Obama administration's intervention in the Chrysler bankruptcy, the rule of law has been violated. One group (the UAW) has benefited from Obama's arbitrary decision to put unsecured debt (UAW benefits) above secured debt (lenders and bondholders.) In fact, one of the lawyers for a holder of secured debt said that the White House even threatened to use the White House press corps to "ruin" anyone who wanted the proper and expected distribution of funds from Chrysler by opposing Obama's decision to give the UAW 55% of Chrysler and put unsecured debt before secured . That lawyer's client eventually succumbed to the pressure, and meekly agreed to the settlement. Other bondholders did not.

After that threat was made (allegedly, of course,) Obama stayed true to his word, according to the Washington Post: "The [non-compliant] lenders were sharply criticized last week by President Obama, who blamed them for forcing the third-largest U.S. automaker into bankruptcy. Obama characterized the group as "speculators" who were fishing for "an unjustified taxpayer-funded bailout." In Obama's definition, "speculators" includes pension funds that invested in Chrysler with the full expectation of earning a profit or, failing that, getting all or most of their money back if Chrysler went broke. After all, theirs was secured debt. They are discovering that Obama does not bluff when it comes to rewarding political allies and attacking political enemies. (In direct contrast to how he treats those who attack America.)

Of course, Obama learned politics in the heart of corruption, the Chicago political machine. With this violation of a bedrock legal principle, and Obama's strong-arm tactics, we see now the consequences of electing a candidate whose history was full of terrorists, criminals and marxist mentors, and who the mainstream media supports without challenge. We have become a nation not of laws, but of one man.

What did you expect?

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