There is a word for this type of activity

It's called extortion.

From the L.A. Times:

"The Obama administration is threatening to rescind billions of dollars in federal stimulus money if Gov. Arnold Schwarzenegger and state lawmakers do not restore wage cuts to unionized home healthcare workers approved in February as part of the budget."

As part of the budget deal passed earlier this year, the legislature cut
$74 million from its budget that would have helped pay workers that care for low-income and elderly Californians. The Department of Health and Human Services, at the request of, surprise, the SEIU, sent a letter to the Governor saying that if he didn't reinstate those lost wages, California would see $6.8 billion less in stimulus money. Nevermind that the state is already facing a $23 billion shortfall in revenues this summer and could go "broke."

Yes, this is nothing short of extortion- the Federal government, at the request of the union, is threatening the state to comply or else. The Federal government is threatening to withhold a significant amount of money to the state, all to show how far this Administration will go to bend at the will of the unions, the economy be damned. They've already catered to the unions on Chrysler, so it's no surprise that they would cater to the unions on this.

Not to mention allowing GM to simply stop the Saturn line, which, as the Newsweek article explains, was once the next big step in U.S. automaking, but soon found itself mired and stuck in union anti-competitiveness assurances (or, as Mickey Kaus puts it, "Could it have been that Saturn's success--in a plant where workers traded inflexible work rules for responsibility and job satisfaction--threatened the hide-bound Wagner Act rulebooks of all of the UAW's other locals? So that the UAW pressured Saturn to build cars outside of its Spring Hill, Tennessee home--while it supported GM in systematically starving Saturn of new products? Just asking!"). Once GM announced the end of the Saturn line, as part of their post-bailout plan, the Administration quickly bestowed upon them another batch for federal funds to keep GM going.

Again, not that the Administration really cares about the viability of the automakers, all the Administration cares about is the continued support of the unions, at the expense of the automakers, and the American public at large, who will be on the hook for all of this.