This is a complete perversion of the bankruptcy process. If I were the other creditors of the company, I’d be in federal court tomorrow suing the government for breach of fiduciary duty. The trouble is, many of those creditors are banks that the U.S. Treasury already controls. It’s sweet to be able to pull so many puppet strings at once to benefit the unions, isn’t it?

It’s also a perfect example of what I posted earlier— the Article I section 8 bankruptcy power of Congress, as enacted into the bankruptcy statute, is being used as political cover for a government takeover of a major, publicly held company at taxpayer expense, and then to cover a sweetheart deal with the labor unions.

The U.S. government is taking sides in labor-management issues as to which it traditionally had remained neutral. The labor relations laws enacted this neutrality, which Obama now has abandoned without enabling legislation. I have no doubt that Congress will ratify all of this, papering over the highhanded use of executive power.