Add Crash Victims to the List of People Obama Screwed Over in His Rush to Create Government Motors

Orwellian, and yet, Kafkaesque at the same time.  At this point in time, I’m beginning to wonder if Orwell and Kafka didn’t grow some sort of freakish love child in the laboratory and name him Barack Obama:

Car Bailouts Left Behind Crash Victims


Vicki Denton died several years ago after the airbag in her 1998 Dodge Caravan minivan failed to deploy during a head-on collision in the Georgia mountains. In 2009, a jury found Chrysler responsible for her death because of a manufacturing defect, awarding her surviving son and other relatives $2.2 million.

The family was near collecting those damages on the eve of Chrysler’s government-brokered bankruptcy. Now, two years removed from a $12.5 billion bailout, Chrysler Group LLC still hasn’t paid the damages, and doesn’t have to.

The reason: The company’s restructuring allowed it to wash away legal responsibility for car-accident victims who had won damages or had pending lawsuits before its bankruptcy filing. The same holds true for General Motors Co., which discarded the liabilities as part of its own $50 billion bailout and restructuring.

In rescuing the car makers, the U.S. government […] created a wide universe of relative winners and losers. The U.S. Treasury received large ownerships stakes in the restructured auto makers, as did union retiree trusts. Chrysler’s banks got some, not all, of their loans repaid in cash, and GM’s lenders were fully repaid. On the other side, thousands of dealers, asbestos victims and other creditors received little to no recompense.

Among the creditors who suffered most, car-accident victims represent a distinct mold. Unlike banks and bondholders, this group didn’t choose to extend credit to the auto makers. As consumers, they became creditors only after suffering injuries in vehicles they purchased.

“This was not a normal case. The government was deciding who was going to be taken care of and who was not,” said David Skeel, a University of Pennsylvania law school professor and bankruptcy expert who has testified before Congress on the auto bailouts.


Among the largest unpaid awards is nearly $23 million owed to the parents of Joshua Flax, an eight-month-old infant who died when the Dodge Caravan minivan he was riding in was rear-ended.


Mr. Sparkman, Joshua’s grandfather, still seethes that the auto maker hasn’t paid his daughter’s damages.

“We did what we were supposed to do, we went through the legal system,” he says. “This is a real person. It’s not just something to write off on the ledger book.”


Explore posts in the same categories: Abuse of Power, Obama Sucks, Orwellian, politics

2 Comments on “Add Crash Victims to the List of People Obama Screwed Over in His Rush to Create Government Motors”

  1. Gonzo Says:

    At first I was a bit confused by this blog, as I knew it was Bush that gave Chrysler $4 billion bailout, not Obama. But then I found this article which indicates that it was the Obama administration which not only forgave that debt, (Chrysler wont have to pay it back) but nearly doubled the total amount (now given instead of loaned) of bailout cash to $7 billion. Additionally, the Obama administration approved the bankruptcy plan which shots creditors in the foot – creditors who needed the money to pay employees, who would then have to lay people off because they ended up bankrupt.

    What was all this big talk from Obama about holding institutions accountable?

    • PB-in-AL Says:

      But, Gonzo, the government isn’t an institution. Chrysler and GM are now owned by the government, so they’re not institutions anymore either. Thus the government isn’t accountable, nor are these two former institutions. Hence, FREE MONEY!!!! wooo hoo!

      But seriously, when I read this I wasn’t surprised, disgusted – yes, surprised – no. All the Dem talk about the “little guy” and they’re the worst in attitude and effect on the true “little guy”. I suppose that “little guy” is a pre-defined term indicating the favored-status special-interest group-of-the-day. Because, of course, that “favored status” can be reeled back in at a moment’s notice for some violation of the unspoken rules, or pricking of the thin skin, whatever.

      I feel for these folks, as the one guy says, they went through all the legal hoops and won a judgement; now they’ve been hung out to dry by executive fiat. That is absolutely WRONG!

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