It appears Obama's general plan for the economy was, among other things, to encourage credit. Credit, we are told, makes our modern economy go around, and apparently it would be a terrible tragedy if anybody had to save a bit of money before indulging in the latest impulse buy. Meanwhile, in Detroit, Obama's administration strong armed the bond holders.
The bond holders are people who lend money. In normal bankrupcy situations they get paid first. If you really want credit to flow you couldn't do anything dumber than mess with their contracts. Bond holders can't calculate risk under these conditions, so they will be very unwilling to lend regardless of what the government tries to do, and I wouldn't be surprised if government moves into widescale lending as it becomes apparent those that would normally lend won't under these new conditions.
We have already had an example of government lending: Fannie Mae and Freddie Mac.
And then there is all the TARP and automaker bailouts that were obvious failures at this point. Dave at Southern Bread dusted off his Communist Manifesto and mined it for answers, mainly because the ways in which the administrations actions make any sense are few and far between.
Pride, whether communist or otherwise, clearly plays a part.