It was almost like waiting for the other shoe to drop.
Recall last spring when General Motors CEO, Ed Whitacre, was on national television flat-out lying to the American public regarding paying off their TARP loan when in reality they were simply using another TARP line of credit to do so?
Now, if you were looking for a reason to not buy from Chrysler as well, you just may have found it.
American taxpayers have already spent more than $13 billion bailing out Chrysler. The Obama administration already forgave more than $4 billion of that debt when the company filed for bankruptcy in 2009. Taxpayers are never getting that money back. But how is Chrysler now paying off the rest of the $7.6 billion they owe the Treasury Department?
The Obama administration’s bailout agreement with Fiat gave the Italian car company a “Incremental Call Option” that allows it to buy up to 16% of Chrysler stock at a reduced price. But in order to exercise the option, Fiat had to first pay back at least $3.5 billion of its loan to the Treasury Department. But Fiat was having trouble getting private banks to lend it the money. Enter Obama Energy Secretary Steven Chu who has signaled that he will approve a fuel-efficient vehicle loan to Chrysler for … wait for it … $3.5 billion.
Technically speaking, the DOE loan program is for specific, qualifying re-tooling projects but when your re-election campaign efforts will rest, in large part, on the health of the two domestic auto-makers to which you are wed, why bog down that $3.5 billion in bureaucratic red tape.
So, to recap, the Obama Energy Department is loaning a foreign car company $3.5 billion so that it can pay the Treasury Department $7.6 billion even though American taxpayers spent $13 billion to save an American car company that is currently only worth $5 billion.
Kind of tough to cram onto a campaign button but you leave out enough of the details, it just might fit.