Wednesday, May 6

Update: Chrysler's Government Debt to be Written Off

In a previous post, 'Why Not 'Cram-Down' Chrysler's Government Debt?', I asked why the Government wasn't pushing for Chrysler's debt to the US Government be written off, just like they want US Bankruptcy Judges in the US to have the ability to write off part of a homeowner's mortgage.

Well, it turns out that Chrysler's Bankruptcy Judge will not need to do this as part of the reorganization plan includes not paying back the $8 Billion loaned to Chrysler by the Government.
Chrysler LLC will not repay U.S. taxpayers more than $7 billion in bailout money it received earlier this year and as part of its bankruptcy filing.

This revelation was buried within Chrysler's bankruptcy filings last week and confirmed by the Obama administration Tuesday. The filings included a list of business assumptions from one of the company's key financial advisors in the bankruptcy case. - Volokh (found via Instapundit)
So there goes $7 Billion down the drain. For that $7 Billion, the Government could have just given each of Chrysler's 58,000 employees $120,000.

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