Welcome to double-standard America

[David Farber <dave () farber net>]

Begin forwarded message:

From: dewayne () warpspeed com (Dewayne Hendricks)
Date: March 22, 2009 4:48:44 AM EDT
To: Dewayne-Net Technology List <xyzzy () warpspeed com>
Subject: [Dewayne-Net] Welcome to double-standard America

Welcome to double-standard America
The AIG scandal has made it apparent that we are ruled by a government  
of men, not laws.
By David Sirota

Mar. 21, 2009

<http://www.salon.com/opinion/feature/2009/03/21/sirota/print.html>

United Steelworkers president Leo Gerard likes to say that Washington  
policymakers "treat the people who take a shower after work much  
differently than they treat the people who shower before they go to  
work." In the 21st century Gilded Age, the blue-collar shower-after- 
work crowd is given the tough, while the white-collar shower-before- 
work gang gets the love, and never before this week was that doctrine  
made so clear.

Following news that government-owned American International Group  
devoted $165 million of its $170 billion taxpayer bailout to employee  
bonuses, the White House insisted nothing could be done to halt the  
robbery. On ABC's Sunday chat show, Obama advisor Larry Summers  
couched his passive-aggressive defense of AIG's thieves in the  
saccharine argot of jurisprudence. "We are a country of law -- there  
are contracts (and) the government cannot just abrogate contracts," he  
said.

The rhetoric echoed John Adams' two-century-old fairy tale about an  
impartial "government of laws, and not of men." Only now, the  
reassuring platitudes can't hide the uncomfortable truth.

Last month, the same government that says it "cannot just abrogate"  
executives' bonus contracts used its leverage to cancel unions' wage  
contracts. As the Wall Street Journal reported, federal loans to G.M.  
and Chrysler were made contingent on those manufacturers shredding  
their existing labor pacts and "extract[ing] financial concessions  
from workers." In other words, our government asks us to believe that  
it possesses total authority to adjust contracts at car companies it  
lends to, and yet has zero power to modify contracts at financial  
firms it owns. This, even though the latter set of covenants might be  
easily abolished.

According to New York Attorney General Andrew Cuomo, these allegedly  
inviolate AIG agreements promised bonus money the company didn't have  
and were crafted by executives who knew the firm was collapsing,  
meaning there is a decent chance these pacts could be invalidated  
under "fraudulent conveyance" statutes. They also might be canceled  
via "force majeure" clauses allowing one party to rescind a pact in  
the event of extraordinary circumstances -- like, perhaps, the  
collapse of the world economy. (Note: BusinessWeek reports that  
corporations are already citing the recession as reason to invoke such  
clauses and nix their business-to-business contracts.)
[snip]
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