Yes, according to an attorney representing numerous Chrysler bondholders. Apparently, in an attempt to get investors to approve a brokered deal to resolve the automaker’s debt, the White House threatened to use the White House Press Corps to destroy the reputations of investors opposed to the deal.
Lauria: Let me tell you it’s no fun standing on this side of the fence opposing the President of the United States. In fact, let me just say, people have asked me who I represent. That’s a moving target. I can tell you for sure that I represent one less investor today than I represented yesterday. One of my clients was directly threatened by the White House and in essence compelled to withdraw its opposition to the deal under the threat that the full force of the White House Press Corps would destroy its reputation if it continued to fight. That’s how hard it is to stand on this side of the fence.
Beckman: Was that Perella Weinberg?
Lauria: That was Perella Weinberg.
The White House apparently called those bondholders who insisted on their rights as senior creditors “vultures”. Now, it’s entirely possible that the attorney is being less than truthful in an attempt to drum-up attention. But you’d think the media would be interested in whether or not the White House is using them to threaten investors. Instead, we’ve basically heard crickets from all corners of the corps.
Exit question: Would this really surprise anyone if it’s true? We’re talking about the same President Obama who proclaimed that he was the only thing standing between the CEOs and the angry crowds with pitchforks. And the same one who fired General Motors’ chief executive officer. Strong-arming isn’t exactly a new tactic to the Chicago Democrat.
Update: The White House is strongly denying the claim:
The White House said the story was false.
“The charge is completely untrue,” said White House deputy press secretary Bill Burton, “and there’s obviously no evidence to suggest that this happened in any way.”
Of course, this would be the same Bill Burton who sarcastically blew off the posting of a photo containing a CIA document…right before the White House completely scrubbed its Flickr account of the picture.
More: Ed Driscoll, Infidels Paradise, Danishova, Rhymes with Right, Nice Deb.
by Stephan Tawney on Sat, May 2, 2009