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CONGRESSMAN PETERS TO BANKS: STOP SEEKING MORE TAX DOLLARS THROUGH AUTOMAKERS

Washington, D.C. – Congressman Gary Peters, whose Michigan Congressional district is home to Chrysler World Headquarters, today called on the four major financial institutions holding the vast majority of Chrysler’s secured debt to extinguish a substantial portion of that debt as required in President Obama’s auto viability plan.  The plan requires Chrysler to achieve several objectives before the end of this month or Chrysler will likely face bankruptcy, and the unwillingness of automakers’ debt holders to negotiate a settlement is the largest hurdle that must be overcome. 

In a letter to the CEOs of JP Morgan, Citigroup, Goldman Sachs and Morgan Stanley, Congressman Peters noted that these institutions have already received billions of dollars in taxpayer investments (both in TARP funds and as counterparties to AIG) and that any debts they collected from Chrysler would simply be more tax dollars. 

“These banks hold the key to Chrysler’s survival,” said Rep. Peters.  “Despite taking billions in taxpayer support to keep themselves solvent, these creditors are unwilling to reach a fair deal to keep Chrysler alive and to protect hundreds of thousands of American families.  These financial institutions are already leading recipients of taxpayer support and any money received from Chrysler will simply be more tax dollars.  The banks that hold Chrysler’s debt were provided federal support for the good of the economy, and they should negotiate in good faith with automakers for the same reason.”

Mr. Peters’ letter to JP Morgan follows.  Letters to Citigroup, Goldman Sachs and Morgan Stanley are identical other than figures on federal support each institution has received.  To date, these financial institutions have received:

• JP Morgan: $25 billion through TARP, $400 million as an AIG counterparty
• Citigroup: $25 billion through TARP, $2.3 billion as an AIG counterparty
• Goldman Sachs: $10 billion through TARP, $12.9 billion as an AIG counterparty
• Morgan Stanley: $10 billion through TARP, $1.2 billion as an AIG counterparty