2016 Postmortem
Related: About this forum"Why Bain Questions Matter" by Eugene Robinson at truthdig.com
Why Bain Questions MatterPosted on May 25, 2012
By Eugene Robinson at truthdig.com
http://www.truthdig.com/report/item/why_bain_questions_matter_20120525/?utm_source=twitterfeed&utm_medium=twitter&utm_campaign=Feed%3A+Truthdig+Truthdig%3A+Drilling+Beneath+the+Headlines
"SNIP.........................................
Theres nothing inherently wrong with private equity, which plays an important role in the economy. And, of course, theres nothing wrong with wealth; those who risk their capital in private-equity ventures should be rewarded when those deals pay off. No one begrudges Romney his offshore investment accounts, his mansions or his wifes Cadillacs.
But as Romney himself acknowledges, free markets need rules and regulations in order to function. Some kinds of dealings are prohibited or even criminalizedinsider trading, for example, because of the way it benefits a select few at the expense of other investors.
It is reasonable to ask whether some highly leveraged buyout deals, of the kind that Bain and other private-equity firms often conduct, should fall into the same thumb-on-the-scale category as insider trading.
Suppose a company is failing and appears beyond rescue. Suppose a private-equity firm buys the company with borrowed money, burdens it with more debt, and then spends the next few years firing workers, selling assets, eliminating pension plansall the while collecting handsome management fees. Then the company fails anyway, as it was fated to do.
.............................................SNIP"
Voice for Peace
(13,141 posts)& rec
AynRandCollectedSS
(108 posts)Of course it matters! He's running on the promise of being able to fix the economy because he supposedly knows how to run a business.
I've been talking about this on our FB page all damn week. Here's the most recent exchange:
Comment:
"That's the way cappitaliosm works.
Sheesh!
Romney has a great record of success in the business world.
Whereas obama has no experience at all."
My reply:
Yep, that's the way Capitalism works alright. The more greedy, depraved and willing to be a scumbag you are, the more money you make! He does NOT have a great record of success. He has a great record of making money. There's a big difference. Ask the THOUSANDS of people Bain laid off how "successful" they feel.
No one's attacking Capitalism or or private equity if it's done in an ethical way. Buying a company, bankrupting it and making a government agency cover the pensions to the tune of over 44 million dollars, that are gone because of your gross mismanagement (as happened with GS in Technologies 2002) while walking away with millions in profit for yourself and investors is NOT what made this country great. The end scenario was 750 people out of work and a handful of people much wealthier. There are many more examples just like this marring his "successful" record.
How long do you think that can sustain an entire country? Who will buy their products and keep the economy going after people like Romney either lay everyone off due to their own business incompetence or because they want to squeeze more profit from the company they're picking apart and ship all the jobs overseas? Explain to me how venture capitalism carried out in that way enriches us as a nation or helps build a strong foundation we can stand on for generations to come?
All he did was make a few people rich at the expense of what he considers inconsequential middle class American workers.
Lugnut
(9,791 posts)sulphurdunn
(6,891 posts)is not a civil right. Being rich is not a qualification. Protecting riches is not a duty. Creating a more perfect union is.
MindMover
(5,016 posts)this perfect union around/with the help of, a document that is several hundred years old and interpreted thru the lens of a religious book/belief that is several thousand years old.....
raouldukelives
(5,178 posts)But there is something wrong with Wall St. I'm not sure it is able to be regulated. At least, not at the level that would make me comfortable with it and not without taking years and years of fighting while all the while what little is left of our planet is bring ground into pennies. It's not making anything better. Maybe in a pre-climate change world that was acceptable.
"Pollution is going to happen, someday it will be figured out by smart people so for now I'll just keep investing."
Those days are long gone. We know that every day that passes without radical change equals that much more misery and death. Every dollar in the market is just heaping coals on the lives of people and wildlife of tomorrow. We literally know our actions today are making life a living hell for critters and kids and we laugh and sip our lattes.
"Somebody will figure it out." Uh No, they won't. It will be stripped bare and when the people suffering ask "Why?!" we will tell them it was the only way we could figure out to put food on the table. That some people felt the world was theirs alone and that killing it and everything on it for a little money was a God given right.
Crazy world. When I first became a Democrat it was because of the environment. The great people I met fighting against deforestation and offshore oil drilling. I was surrounded by proud Democrats who believed in protecting the earth and it's wonders to their core. I'll climb a tree and fucking live in it. People who were willing to forgo some of the pleasures of life in order to create a better world. Who wouldn't dream of making money by investing in military contractors or oil exploration.
I feel like the majority of those people are all gone now. I'm a Democrat because I am a liberal. I am not a liberal because I'm a Democrat.
Who knows. Maybe it's a lost cause. But sometimes those are the only ones worth fighting for.
tcaudilllg
(1,553 posts)Very, very wrong.
siligut
(12,272 posts)What does this mean? I think this justifies one wrong while qualifying another.
goclark
(30,404 posts)Tell it like it is ---
maindawg
(1,151 posts)Back in the 80's while Mittens was destroying companies and lives for fun and profit, W was destroying companies using sheer incompetence . Companies his daddy set gave him, companies he illegally traded insider info on ruining peoples lives for fun and profit . No one on the right cared about all that back in 99'.
The mere fact that Mittens is not the idiot son, makes him a better candidate already.That he is crooked is expected on the right. Its a bonifide. Its a plus.
DallasNE
(7,403 posts)Venture capitalism becomes vulture capitalism. The problem Romney has is that Bain all too often crossed over into the latter group.
applegrove
(118,778 posts)moderately successful enterprise goes into partnership with people with money and they grow the company and more often than not create jobs. That is not what Bain was doing. Don't use the term venture capitalism in reference to Romeny. Use the term private equity.
goclark
(30,404 posts)Rmoney is a Vulture......
"A person of a rapacious, predatory, or profiteering nature"
http://www.thefreedictionary.com/vulture
MightyMopar
(735 posts)Private equity isn't usually a bad thing but leveraged buyouts are a bad thing. I think Main Street and the masses will finally be paying attention to the difference if someone will explain it. Obama? Warren? Who will step up to the plate and tell the people how the cow always eats the cabbage? Tony Soprano maybe?
applegrove
(118,778 posts)it for the public. A look behind the curtain. About time.
democrat2thecore
(3,572 posts)He ran it. He needs to answer for his time there.
w4rma
(31,700 posts)What lies does Bain tell their subsidiaries' creditors to get those loans?
goclark
(30,404 posts)for bringing this to our attention.
JHB
(37,162 posts)...they just had to be easy targets for this sort of takeover.
A better word than "failing" would be "underperforming", was Wall Street defines the term, basically not sending as much money upward as possible. Not failing, just lackluster and with ripe assets.
That could mean it had cash reserves or property that readily-converted into dividends and pay management fees.
Many of the companies were Several generations removed from their founders, and an LBO buyout gave heirs who weren't particularly interested in running the company a chance to cash out. And thanks to lowering of taxes around that time, it made sense to do so, whereas earlier Uncle Sam would have taken a bigger bite. The lower taxes also made the extraction of cash from the company easier, as there too a smaller chunk would have to go to taxes, and the debt the company took on often wiped out even that bill.
The main point being that it was the chAnges in regulation and taxation that made these deals attractive, not any rational business need.