Clem’s Chronicles: Chrysler/North Korea/Air France Mystery

By Clem Lane

Jun 8, 2009 9:22pm

Clem Lane here. Happy Monday. Here's our nightly news note—–

CHRYSLER HITS A BUMP IN THE ROAD-Chrysler’s march thru bankruptcy court hit a snag today when Supreme Court Justice Ruth Bader Ginsberg stayed the sale of most of the company’s assets to Fiat pending “further order”. A federal appeals court in New York approved the sale Friday but gave opponents until 4 p.m. EDT today to try to get the Supreme Court to intervene. Ginsburg issued her order right before the deadline. So who are the opponents of the Chrysler sale? Chris Bury, filing for WORLD NEWS, tells us: “Three Indiana pension funds-representing police, teachers, and taxpayers, stands  to lose at least $6 million if the deal goes through-a tiny fraction of the billions at stake.” That relatively small stake, the government argues, pales in comparison to the potential shuttering of Chrysler’s entire business. And what of the deal with Fiat? Bury tells us “Timing is critical. The deal with Fiat is set to close by June 15th and if the court case is not resolved by then, the Italian automaker could cancel the proposed merger.”
Sounds bad doesn’t it? Jan Crawford-Greenburg gives us some context on Ginsburg’s actions. “The key word is temporary” Crawford-Greenburg told Charles Gibson on WORLD NEWS. “She’s just giving the justices more time to think about the major legal issues in this case.” Crawford-Greenburg admitted that if the entire Court were to get involved “it would take a long time, much longer than next Monday when this deal has to go through or Fiat could walk away.” But there are a couple of other explanations for today’s order. Crawford-Greenburg: “Remember this appeal just came to the Supreme Court this weekend. There are hundreds of pages of briefs for the justices to read. The lower court opinion hasn’t even been released as of this afternoon, so there’s still a lot for them to study.” Chris Bury notes that it’s not just Chrysler watching how this case unfolds but General Motors as well: “Some of the disappointed creditors in that case are making the very same arguments made by the Indiana pension funds. So what the Supreme Court ultimately decides has enormous consequences.” What sayeth the Obama Administration, who encouraged the deal with Fiat? They issued a statement which said "We understand this to be an administrative extension designed to allow sufficient time for the Court to make a determination on the merits of the request for a stay."

JOURNALISTS CONVICTED IN NORTH KOREA: Journalists Euna Lee and Laura Ling became diplomatic pawns between North Korea and the United States after Pyongyang sentenced the two to 12 years of hard labor Sunday. “Today top U.S. officials expressed their hope that North Korea will set aside the 12 year sentence…But that may be wishful thinking.  Laura Ling and Euna Lee are now a powerful bargaining chip. And that raises the stakes for the Obama administration,” David Wright reported on WORLD NEWS.  Kirit Radia has more: “The challenge for the US now will be to balance punishing Pyongyang for its recent nuke test without antagonizing the North as it seeks to win the release of the two Americans. It's terrible timing for the US which wants to tighten the screws on North Korea… but perhaps worse timing for the two Americans.  The US has sought to de-couple the two issues, though it will be difficult for Lee and Ling not to become a pawn in the delicate diplomatic dance.  [Secretary] Clinton today did her best to separate the sanctions from their detention, echoing lines we've heard from the US in recent weeks.  ‘We view these as entirely separate matters.  We think the imprisonment, trial and sentencing of Laura and Euna should be viewed as a humanitarian matter.  We hope that the North Koreans will grant clemency and deport them,’ she said. ‘There are other concerns that we and the international community have with North Korea, but those are separate and apart from what's happening to the two journalists.’”  Ling and Lee will likely be sent to one of Pyongyang’s six labor camps.  This evening the families of Lee and Ling issued a statement that said “We ask the Government of North Korea to show compassion and grant Laura and Euna clemency and allow them to return home to their families.  We remain hopeful that the governments of the United States and North Korea can come to an agreement that will result in the release of the girls.” (thanks to Marisa Bramwell for this entry)

AIR FRANCE LATEST:  The Brazilian navy is sorting through an “ocean of debris” – including airline seats, oxygen masks and fuselage – from Air France flight 447, which crashed last week in the Atlantic Ocean.  The navy recovered a large tail section of the plane, as well as eight more bodies of passengers today, bringing the total recovered to 24.  Recovery of the large tail section may help investigators determine whether the jet broke up mid-air or upon impact, and help narrow down the search location for the plane’s black boxes.  Searchers will employ a French submarine and underwater listening devices from the U.S. Navy to aide in locating the boxes this week.  Investigators are also looking into whether faulty speed sensors – called Pitot tubes – played a role in the plane’s demise.  Lisa Stark reports: “Airbus had recommended changing the sensors because of reliability issues, and Air France had noticed sensors icing up on some flights.  Faulty speed readings can cause the jet to fly dangerously slow or fast.  The sensors had not yet been changed on the plane that crashed. Today two airlines that operate Airbus jets, Delta and US Airways, told ABC News they are now replacing these speed sensors as a precaution.” (thanks to Marisa Bramwell for this entry)

LEBANESE ELECTIONS-A victory for US allies in Lebanon’s parliamentary elections. Results from Sunday’s voting declared by Interior Minister Ziad Baroud showed Saad al-Hariri's pro-Western bloc had won 71 of parliament's 128 seats, against 57 for an opposition alliance that groups Shi'ite factions Hezbollah and Amal with Christian leader Michel Aoun. Simon McGregor-Wood, filing for WORLD NEWS, notes that “the son of the assassinated Prime Minister Rafik Hariri is now a favorite to lead Lebanon.” President Barack Obama, whose country has backed the anti-Syria bloc, said Washington would "continue to support a sovereign and independent Lebanon, committed to peace". "It is our sincere hope that the next government will continue along the path towards building a sovereign, independent and stable Lebanon," he said in a statement. That’s no easy task. McGregor-Wood notes that Hariri “must build a new coalition government not only with his allies, but also with opponents. That may have to include Hezbollah-who may have failed to increase an influence on Lebanese politics but it still has widespread support among Lebanon’s poorest Muslim communities.” So why did the pro-US allies win? The conventional wisdom suggested a slim victory for Hezbollah and its’ partners. Obama Administration officials might like to think that the President’s recent “speech to the Arab world” was the difference maker. Associated Press suggests it was  a more local influence that tipped the balance. A last-minute appeal from Lebanon's influential Maronite Catholic Church to Christians, the main swing vote. Cardinal Nasrallah Sfeir warned of what he called a threat to Lebanon's character and its Arab identity, a clear reference to Hezbollah and its Persian backer, Iran. Regardless of who gets the credit, the news is good for the United States. Mideast special envoy former Senator George Mitchell is expected to visit Lebanon later this week after meetings with the Israelis and the Palestinians. Mitchell will also go to Damascus to meet with Syrian officials. For more on this, please see Kirit Radia’s note to the Foreign News DL.

FORMER GITMO DETAINEE SPEAKS-On WORLD NEWS earlier this evening, Jake Tapper brought us the story of Lakhdar Boumediene, a Bosnian who was freed from Guantanamo Bay prison after seven years of incarceration. Boumediene, Tapper tells us,  lived “in Sarajevo, Bosnia with his wife and two daughters, working for the Muslim Red Crescent charity, helping orphans and others in need.” But then “five weeks after 9/11, because of a confidential source, he was arrested by Bosnian police and he says falsely charged with conspiring to blow up the US and British embassies there.” Boumediene talks of torture at the hands of his American captors at Gitmo and says that he was never asked about the embassy charges while at Guantanamo. Instead, Tapper tells us, “(Interrogators) demanded information he did not have about Osama bin Laden and al-Qaeda.” There’s a (somewhat) happy ending-Tapper says that “last month, Boumediene was flown from Guantanamo Bay to here in France. He was in very poor health and had lost 40 pounds so he was taken to a French military hospital. Ten days later, seven and a half years after he was first arrested, he was reunited with his wife and daughters.” A lawsuit against the US government? Maybe, but Tapper says “of higher priority, getting his life back.”

REPUBLICAN FUNDRAISER/PALIN, GINGRICH AND THE GOP-From Associated Press- Alaska Gov. Sarah Palin appeared at a Republican congressional fundraiser Monday night, ending a will-she-or-won't-she mystery that overshadowed the event and frustrated the GOP. Palin – the party's 2008 vice presidential nominee who was initially slated to headline the annual Senate-House dinner – left organizers hanging as late as Monday afternoon after she was told she wouldn't have a speaking role at the event.  It was the latest twist in an unusual public flap between the potential 2012 presidential candidate and the Republican congressional leaders who run the party's fundraising committees.  In March, organizers replaced Palin as the keynote speaker with former House Speaker Newt Gingrich after she wavered over accepting the invitation. She hadn't been expected to attend until last week, when her advisers approached organizers saying she would be near Washington and would like to come.

GAS PRICES-Dan Arnall: “The Energy Department says customers are paying more at the pump for the sixth week in a row. The official EIA numbers show the average price of a gallon of regular unleaded gasoline up $0.10 this week to $2.62. This is the highest weekly average since the end of October 2008. Even with the increase in retail prices, gasoline is still 35% lower than a year ago ($4.04).”

FED APPROVES STRESS-TESTED BANKS PLANS- The Federal Reserve today said the 10 banks that need to raise more capital as a result of the government’s stress tests have all submitted plans that “would provide sufficient capital” and now the Fed will work with the banks to implement the plans “quickly and effectively”. (Matt Jaffe)
DON’T ASK, DON’T TELL SCOTUS- On the orders list, the Court refused to get involved in a challenge to the military's "don't ask/don't tell" policy, leaving unresolved the ultimate question of its legality. This is not a ruling on the merits.  The Obama Administration had asked the Court to take a pass on the case, which had challenged a lower court decision upholding the policy, in a lawsuit by a dismissed Army captain. Meanwhile, a separate case from a California-based federal appeals court has allowed a similar lawsuit filed by a dismissed nurse to proceed–and the Obama administration did not defend the policy and ask the Court to step in there and rule against the nurse.
The administration has indicated it won't enforce the policy–but is in no hurry for the Supreme Court to step in at this point. (Jan Crawford-Greenburg)
BANKRUPTCIES UP- Bankruptcy filings for the 12-month period ending March 31, 2009 were up 33.3 percent over bankruptcy filings for the 12-month period ending March 31, 2008, according to statistics released today by the Administrative Office of the United States Courts.  Chapter 11 filings rose 69 percent and Chapter 7 filings were up over 46 percent in that time period. (Jan Crawford-Greenburg)
–“CLARK ROCKEFELLER” KIDNAPPING CASE IN THE HANDS OF THE JURY-A jury of eight women and four men deliberated for about 3 ½ hours before going home for the day without reaching a verdict on charges of kidnapping, assault and providing a false name to police. Rockefeller, whose real name is Christian Karl Gerhartsreiter, is accused of snatching his daughter, Reigh, during a supervised visit in Boston last July after losing custody of the girl to his ex-wife. Father and daughter were found in Baltimore six days later. The girl was unharmed. Andrea Canning will be live for GOOD MORNING AMERICA from Boston.
ROBERT BYRD UPDATE- Sen. Robert Byrd remains in the hospital, where he has been since May 15th. A statement released by his office, below, says he is not expected on Capitol Hill this week. Next Monday will mark a month in the hospital for the 91 year-old longest serving Senator, who has a staph infection. Byrd received a note in the hospital from Sen. Ted Kennedy, the second longest serving sitting Senator, who has his own health problems and is rarely seen on Capitol Hill as he fights brain cancer. "Banish the germs and hurry back!" Kennedy wrote to Byrd according to Byrd's office. "West Virginia needs you, the Senate needs you, the nation needs you, and so do I." (Zach Wolf)


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