Representative Thaddeus McCotter (R-MI), Chairman of Republican House Policy Committee, responded to a letter sent by four of his GOP colleagues to Treasury Secretary Geithner complaining that the rights of GM bondholders have been subverted under the continued auto restructuring:
“The selective sympathy for institutional bondholders voiced by my colleagues would be more compelling if they had expressed similar concerns for the auto workers’ and retirees’ who invested their lives in earning benefits from a health care fund that is owed $20 billion by GM. Regardless, if not satisfied with the results of their negotiations, these institutional bondholders’ can always seek equitable redress during a GM bankruptcy these Congressmen have long championed.”
According to reports, Representatives Jeb Hensarling, Eric Cantor, Mike Pence and Pete Sessions sent a letter Friday to Secretary Geithner claiming the proposed restructuring favors the claims of the United Auto Workers union over the rights of the bondholders. The four Congressmen wrote: “We are extremely concerned that in the name of restructuring General Motors, the Presidential Task Force on the Auto Industry … has begun waging what some believe amounts to a war on capital: contractual rights of investors are being trampled by the government under the rationale of ‘extraordinary circumstances.”
To this, McCotter was compelled to remark:
“If my colleagues believe there is a ‘war on capital,’ they should say so outright. I, for one, believe there is a governmental assault on working people and capital in our country. We must defend both and defend them in that order. Thus, my colleagues must remember how this administration inherited the powers and the rationale of ‘extraordinary circumstances’ that spurs such assaults on working families and capital – namely, from the failed Wall Street Bailout. A bailout which, it must be noted, would NOT have been applied to America’s domestic auto industry if the House’s original bridge loan legislation had become law.”
