In case you missed it, Chryslerâ€™s gone paws-up. But this is no normal bankruptcy.Â This is 2009. Rules are made up as governments go along. And moneyâ€™s no object.
The automakerâ€™s corporate failure will cleansed by Ottawa and Washington in order that one goal be accomplished: save jobs. Well, some jobs.
Shareholders were long ago reamed out. Politicians are taking the car company through bankruptcy court to ensure bondholders and other legitimate debtors and creditors are completely and remorselessly screwed. Then, without a vote going to the peopleâ€™s representatives in either capital, $15 billion in public funds will be pumped into a new company which an Italian carmaker will effectively be given.
In return for pumping cash into a moribund outfit that crashed because it built too many cars people didnâ€™t want, overpaid its workers and was run into the ground by millionaire managers, taxpayers will get equity. In Canada, according to PM Stephen Harper and Ontario preem Dalton McGuinty, the people will own 2%. That will cost $3.8 billion.
So, will anything be different going forward? What do Canadians get for spending $375,000 on every single job at Chrysler Canada? If there is no guarantee Chrysler will build new products, be run better, inspire buyers once again and suffer no more ruinous losses, would it not have been safer just to inject 375K into every autoworkerâ€™s RRSP?
Maybe. But that would be outrageous, and unfair to every other working Canadian who does not earn $75 an hour as these company employees did (the union says people on the line get $45, the rest is ‘all-in’ cost). Hey wait, thatâ€™s just about everybody! And I even hear most people who are laid off donâ€™t collect 90% of their normal wages, as idled autoworkers do. No wonder these jobs are special.
Itâ€™s just a damn shame nobody asked taxpayers if this was okay.
But you know why.