Thursday, August 17, 2006

Making Debt Look Good

"I've got to tell you I'm elated for every member of this company,” said former Pacific Lumber President Robert "Hatchet Man" Manne regarding PL's newly aquired $85 million in debt and at least $135 million in credit.

”We're about to turn another page,” he said. “We now have more money to rebuild things and get this back on track.”

Manne said that Palco is in a good position now, and that the principal payment of more than $9 million was actually ahead of schedule. -Times-Standard

A week after this cheerful announcement Manne announced his resignation.

"This is the man who came in to finish the liquidation and conversion of a proud healthy company with four mills and nearly half of its timber in old growth, reducing it down to a company on life support, with just one small-log mill, virtually no old-growth timber, and even more debt than when he arrived." - Mark Lovelace of the Humboldt Watershed Council.

"The Scotia mill, the Britt mill, the co-generation plant, the trucks and the town of Scotia are all on the hook for $135 million in credit. The new liquidity providers are now first in line for the company's assets, ahead of the company's workers, its contractors and even the noteholders."

"Palco is in a hole and they need to stop digging, but instead Manne just bought the company a bigger shovel as a parting gift."

That pretty much sums it up for now.


At 8/17/2006 06:06:00 PM, Blogger noel adamson said...

"16 tons and whadda ya get?
another day older and deeper in debt,
Saint Peter don't ya call me 'cause I can't go;
I owe my soul to the company store"

16 tons-Johnny Cash version (this is a RealMedia version I made for another web site a while back...I lost the MP3 version I started with...sorry)

The 'company store' has long been a notorious system of enslavement especially in mining and timber operations and other business that saw it's workers in isolated locations. The use of forced indebtedness came into it's own in the days of the Robber Barons which began in ernest when the emancipation act, which officially outlawed slavery in the U.S., was passed in 1863, the year Pacific Lumber was founded I'm told. While it was a way to enslave workers by forcing them into permanent debt to the company it is still the same thing in this scenario and the workers are ultimatly amongst the numerous victims. It is now the method of choice for enslaving entire nations via the International Monetary Fund and the World Bank. It is no different than Mafia loan sharking except that instead of Vinnie coming to break your legs when you get behind in your eternal payments law enforcement, the U.S. military or CIA proxy death squads are dispatched depending on the situation.

It's not that this class of people started out with a soul and gradually lost it. That was the original asset which was sold off many, many years ago.

I think most people who visit this blog know this from one vantage or another and don't think embellishment on the original article is necessary but if it is new to one person it seems worthwhile to me to write.


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