King Obama Will See You Now

The WSJ's Holman Jenkins goes off on the Obama administration's treatment of GM and its bondholders and applauds the bondholders for standing up for themselves.

I'm actually glad that Obama is smacking GM around -- without our money, the company would already be bankrupt. But it's the inconsistency I can't stand.

How can my favorite president (seriously) let car czar Steve Rattner charge in, fire CEOs, and demand that bondholders voluntarily give up 85 cents on the dollar...while Treasury Secretary Tim Geithner just keeps sounding and acting like a lobbyist for Wall Street? What's up with that, Mr. President?

It's good to be the king -- until you start tripping over your own robe.

So King Barack the Mild is finding as he tries to dictate the terms of what amounts to an out-of-court bankruptcy for Chrysler and GM. He wants Chrysler's secured lenders to give up their right to nearly full recovery in a bankruptcy in return for 15 cents on the dollar. They'd be crazy to do so, of course, except that these banks also happen to be beholden to the administration for TARP money.

Wasn't TARP supposed to be about restoring a healthy banking system? Isn't that a tad inconsistent with banks just voluntarily relinquishing valuable claims on borrowers? Don't ask...

Why on earth would GM's creditors -- who include not just bondholders but the UAW's health-care trust -- want any part of this deal?