Union vs Union

When the terms of the proposed Chrysler bankruptcy settlement were announced, it looked to me as if the Obama administration was riding roughshod over bankruptcy law in order to aid it’s friends (the UAW) at the expense of the politically unpopular hedge funds. I pointed out that the hedge funds were mostly managing other people’s money and that those “other people” were the true victims. Now some of those victims have emerged:

In several motions with the Chrysler docket earlier, the Indiana State Teachers Retirement Fund, Indiana State Police Pension Trust, and Indiana Major Movers Construction Fund, fiduciaries for “approximately 100,000 civil servants, including police officers, school teachers and their families” have objected to the 363 sale, and demand Judge Gonzalez should block the sale, claiming “the plan is illegal and tramples their rights.

Naked Capitalism

Oh boy. This is the problem with playing fast and loose with the law and an excellent example of a cross-cutting cleavage. While it may have sounded politically expedient to help the union and screw the creditors, we now see that unions are the creditors. I can hardly wait to hear Team Obama’s justification for sacrificing the schoolteachers to help the auto workers.

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