Below The Beltway

Dan Gerstein at Forbes details what may be the biggest snow job in history:

Buried on the business page of The New York Times Saturday were the details of Detroit’s biggest snow job yet–literally as well as figuratively. Turns out that Cerberus CEO John Snow, who spent three-and-a-half lackluster, and some might say lap-doggish, years as President Bush’s second Treasury secretary, is leading a who’s who of crony capitalists in a lobbying campaign for a taxpayer bailout to “salvage Cerberus’ investment in Chrysler.”

That’s right. Not to save the jobs of Chrysler employees or America’s disappearing manufacturing base, mind you, but to prevent “one of the world’s richest and most secretive private investment companies” from having to take a relatively modest financial hit and use some of its own capital to prop up the smallest of the major automakers.

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Last year Cerberus and about 100 co-investors bought an 80% stake in Chrysler and its financing arm at what financial analysts universally say was a fire sale price of $7.4 billion. (Cerberus’ own stake was $2 billion.) Business Week described it as Cerberus getting Chrysler “essentially gratis.”

To date, Cerberus has barely tapped any of its massive holdings–its investments in Chrysler are estimated to be just 7% of its assets under management–to stabilize Chrysler’s precarious finances; the exception was a $2 billion loan in July. Instead, the company has shed 30,000 jobs, a specialty of cost-cutting corporate flip artists like Cerberus.

The main reason for that slimming down? Cerberus has been anxiously trying to fit into its Wall Street wedding gown. According to close followers of the auto industry, Snow and company have been courting GM for a merger with at least the same fervor as it has lobbied the government for a bailout.

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Now Cerberus is looking for the taxpayers to buy them time before they can get a buyout. And to add insult to fiduciary injury, the company has not offered to put any of its money at risk to match the government relief dollars and show good faith to the taxpayers. The best they could do, according to the Times, was to pledge to forgo any fees that it might have collected on its investments if it receives a government loan.

“We’re not in this for the money,” said Cerberus COO Mark Neporent, in what easily qualifies as the most laughable statement in American politics since Sarah Palin said seeing Russia qualified her to be commander in chief.

And what’s particularly outrageous is that our so-called representatives are letting  the thieves at Cereberus get away with it.

It’s really quite simple — if Cereberus believes that it’s investment in Chrysler is so important, it needs to put it’s money where it’s mouth is and stop asking taxpayers for a hand-out.