Obama’s Bain Attacks Aren’t Working

The Obama campaign's focus on Mitt Romney's years at Bain Capital don't seem to be working.

It was inevitable that the Obama campaign would make Mitt Romney’s time at Bain Capital an issue in the campaign. After all, it worked fairly well for Newt Gingrich in South Carolina, and the stories of isolated companies in Missouri or Indiana that were bailed out by Bain but failed to survive (mostly for reasons that had nothing to do with what Bain did) are fairly easy to turn into simplistic “rich v. poor” and “robber barron” type rhetoric. It may not be accurate, but this is politics, and accuracy doesn’t really matter. Personally, I tend to agree with Steve Rattner, President Obama former “car czar,” who argued in The New York Times earlier this week that Bain Capital and other private equity firms perform any essential role in the economy, but that it’s important to remember that “job creation” is not their primary goal.

Indeed, that is true of any business. 

When someone goes into business for themselves, whether it’s Mitt Romney or Steve Jobs, they aren’t dong so for altruistic purposes, they are doing so for the purpose of making a profit. The jobs that may be created as a result of their actions are really just a secondary benefit from their own pursuit of the goal of making money. That’s the way it always has been in the business world, and that’s the way it always will be. Businessmen start out trying to make a profit. Often they fail, but when they succeed their success has benefits for others, including those they employ. As I pointed out back in January, though, that’s just a secondary benefit:

None of this is to say that Romney, or the people are Bain are altruists dedicated to saving struggling companies for the good of America. They went into this business because they believed they could make money, the benefits that others accrue from their actions are, at least to them, purely incidental.  The same is true of Steve Jobs and Steve Wozniak when they started Apple, Bill Gates when he started Microsoft, Sergey Brin and Larry Page when they started Google, and Henry Ford when he started making cars. They were all interested in making a profit and, in doing so, they created things that benefited everyone. One doesn’t have to believe that actors in the economy are altruists, though, or ignore the idea that they are primarily concerned with earning a profit to recognize the role that what they do plays in the process of economic progress.

All of this is a difficult political argument to make, of course. It’s far easier to empathize with the workers featured in the video embedded above than to wrap ones brain around the idea of creative destruction and accept the fact that progress often means temporary loss.

In the end, Romney was probably mistaken to point to his business record as evidence of his ability to “create jobs,” but that’s water under the bridge at this point. Romney made the claim, and both his Republican opponents and the Obama campaign took the logical step of trying to undermine it.

Emphasis on the word trying. 

Jan Crawford at CBS News takes note that the Bain-based attacks on Romney don’t seem to be working:

In the past two weeks, the Obama campaign has rolled out several attacks on Romney and his time at Bain Capital.

“He’s running for president, and if he’s going to run the country the way he ran our business, I wouldn’t want him there,” a steelworker says in one ad.

But so far, it’s not working.

Instead of a bump in public opinion for the president, recent polls show Romney’s approval ratings on the rise — and sharply so in the key swing state of Florida.

With the attacks failing to resonate, the Obama campaign is hitting even harder.

In California Wednesday night, the president turned up the volume with attacks that sounded almost personal — and placed himself on the side of “regular” Americans.

“I think he’s drawn the wrong lessons from these experiences,” Mr. Obama said of Romney. “He seems to believe that if CEOs and wealthy investors like him are getting rich, that the rest of us do, too.”

It’s rhetoric that works well with the rank-and-file, no doubt, but as former Clinton Adviser Lanny Davis points out, it just isn’t right:

Private equity firms often invest in distressed companies by putting in cash and cutting expenses in order to save a company that is already close to bankruptcy. Sometimes the investment works and the company and jobs are saved. And sometimes, to save the company, jobs need to be cut or wages and benefits reduced.

Does that sound familiar? It should. It’s called the General Motors bailout, widely touted by President Obama and Democrats as a success story, which it was. GM, facing bankruptcy, laid off tens of thousands of workers, reduced wages and benefits among some remaining workers, and the rest is the good news. GM was saved and is now making billions in profits, with most of the “equity” tax dollars having been repaid. Romney opposed that successful “taxpayer” equity investment for reasons that escape me.

The Obama anti-Romney Bain Capital campaign ad focused on a Kansas City steel company, GS Technologies, which was on the verge of bankruptcy when Bain Capital purchased it in 1993 for $80 million. GS went bankrupt in 2001, with several hundred workers losing their jobs. The ad featured several of them blaming Romney and Bain for the lost jobs, but it omitted several facts, such as:

Mitt Romney had left Bain Capital two years before bankruptcy had been declared.

The head of Bain at the time of the GS bankruptcy decision is now a major Obama fundraiser.

Bain invested another $100 million in plant modernization and four years later the company reportedly had reached more than $1 billion in revenues.

After the company went bankrupt in 2001, the president of the plant’s union didn’t blame Bain but rather, cheap foreign imports. “We can’t compete against the steel imports that are being sold under cost,” he said.

But, of course, as I said this is politics and facts don’t really matter very much in politics. What’s interesting is that there seems to be a contrast between what happened to Romney when Newt Gingrich, and to some extent Rick Perry, unleashed these Bain attacks during the South Carolina and now. While Romney was already running from behind in South Carolina, his numbers started to drop precipitously once Gingrich and his SuperPac went on the air with the anti-Bain advertisements. That’s not happening now. Instead, as we saw this week in both the national and swing state polling that was released, Romney’s numbers have improved and, more interestingly, his favorable/unfavorable numbers have improved as well. Some of this is due, as I noted in my posts on the polls, to the fact that the race for the GOP nomination is finally over so he isn’t being subjected to daily attacks from members of his own party (not to mention their surrogates), but there doesn’t appear to be any evidence at this point that the attacks on Romney’s record at Bain are resonating with the public at all.

FILED UNDER: Barack Obama, Campaign 2012, Politicians, US Politics, ,
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010. Before joining OTB, he wrote at Below The BeltwayThe Liberty Papers, and United Liberty Follow Doug on Twitter | Facebook

Comments

  1. al-Ameda says:

    They aren’t working because Americans know that Romney is a job creator, and that is completely consonant with the fact that Bain purchased companies, cut back operations, shut down plants, and laid off American workers.

    Who can’t see that?

  2. Hey Norm says:

    Well if Lanny Davis says it then it’s gospel.

  3. Ron Beasley says:

    As I said the other day:

    The Obama campaign should start going after Romney’s foreign policy. Collin Powell gave them the talking points.

    WASHINGTON — Former Secretary of State Colin Powell on Wednesday questioned Mitt Romney’s choice in foreign policy advisers, saying that some are so right-wing that the advice they give deserves “second thought.”

    “I don’t know who all of his advisers are, but I’ve seen some of the names and some of them are quite far to the right. And sometimes they might be in a position to make judgments or recommendations to the candidate that should get a second thought,” Powell said during an appearance on MSNBC’s “Morning Joe.”

    He gave the example of Romney recently saying that Russia is the “number one geopolitical foe” to the United States.

    “Come on Mitt, think,” Powell said. “That isn’t the case.”

    Romney’s team of about 40 foreign policy advisers includes many who hail from the neoconservative wing of the party, according to a May analysis conducted by the The Nation. Many were enthusiastic supporters of the Iraq War, and many are proponents of a U.S. or Israeli attack on Iran.

    If you liked George W Bush you will love Romney. More wars and more tax cuts.

  4. Jay Dubbs says:

    The Bain attacks are part of the strategy to keep the “I created 100,000 jobs” speech from continuing. Plus it is part of the meta narrative that this guy isn’t going to look out for you.

    I think Romney’s rising poll numbers are based on two factors. 1) The GOP base is coming home and 2) he isn’t on TV all that much. The more Romney is just the “not Obama” the better he will do.

  5. michael reynolds says:

    Republicans invented this “job creator” label in an attempt at rebranding their Randian me-me-me philosophy. Now they’re getting some pushback. Finally.

    There’s no telling at this stage if it’s working or not.

    Mr. Bush gave business everything it asked for. What we got back was a record-setting recession and near-collapse. So it follows of course that Romney wants to take us back to those halcyon days.

  6. Dazedandconfused says:

    Too early to tell. It’s probably just started, and the public’s reaction to handling it like Jon Stewart handled it here is not yet known. And I suspect they will get around to that, when the election gets closer.

    http://www.thedailyshow.com/watch/tue-january-31-2012/indecision-2012—bain-man

    Right now, the media is only dealing in generalities.

  7. MBunge says:

    The Doug Mataconis School of Politics – If something isn’t totally and undeniably successful within the first two weeks, abandon it like it was a diseased piece of pork.

    Mike

  8. James says:

    Jon Lovett recently pointed out the brash hypocrisy of superlobbyists like Lanny Davis:

    Washington is filled with people making other people’s arguments for money. Anyone trying to do anything of good purpose is in a constant struggle to keep from drowning in the river of steaming bullshit served up by lobbyists and politicians and pundits and PR firms. They bend statistics, they do impressions of people who believe what they say, and all the while the country burns. And it is the height of arrogance to decry what’s happened to our politics when you are a bonded practitioner of what’s happened to our politics.

  9. Ron Beasley says:

    We would not even be having this argument if not for the absurdity of 35 years of the idiotic supply side economics. Rich may hire people but they don’t create jobs – it’s customers that do that. They hire people when their customers have enough money to buy more of their stuff. They don’t hire people because they get tax cuts – no customers no jobs.

  10. Septimius says:

    So, let me get this straight. Bain Capital bought a steel company on the verge of bankruptcy, invested $100 million into it, kept it going for another 8 years before it finally went bankrupt (2 years after Romney left Bain). Only in the fever swamps of the liberal mind could this be considered a negative.

  11. James says:

    @Septimius: Overrepresenting an anecdote, on the other hand, must certainly be the mark of a conservative.

  12. KariQ says:

    I suspect that the Obama team is satisfied with the way this discussion is going.

    Romney needs to make the case that Obama should be fired If we’re focusing on whether or not Romney actually created jobs at Bain, then Obama is winning. Time spent arguing about whether or not Bain created jobs is time not spent convincing people to fire Obama. Romney’s approval numbers are still low of a presidential challenger and Obama’s are right on the bubble for reelection.

  13. Jeremy R says:

    Today’s Wapo-ABC Poll:

    Q: Regardless of who you support, which candidate do you trust to do a better job creating jobs?
    Obama – 47%
    Romney – 44%

    Q: Regardless of who you may support, who do you think better understands the economic problems people in this country are having?
    Obama – 48%
    Romney – 40%

    Q: Regardless of who you may support, who do you think has the better personal character to serve as president?
    Obama – 52%
    Romney – 38%

    Q: Regardless of who you may support, who do you think is more likely to stand up for what he believes in?
    Obama – 51%
    Romney – 38%

    Q: What do you think is the bigger problem in this country – (unfairness in the economic system that favors the wealthy), or (over-regulation of the free market that interferes with growth and prosperity)?
    Unfairness – 56%
    Over-regulation – 34%

    Q: Who do you think would do more to advance the economic interests of middle class Americans?
    Obama – 51%
    Romney – 41%

    Q: Who do you think would do more to advance the economic interests of wealthy Americans?
    Obama – 24%
    Romney – 65%

    Q: Is Romney’s work buying and restructuring companies before he went into politics a major reason you to (support) that candidate, a major reason you to (oppose) that candidate, or not a major factor in your vote?
    Major reason to support – 21%
    Major reason to oppose – 21%
    Not a major factor – 54%

    That last survey question is most important. Romney had constructed a voter conventional wisdom that he was the job creation/economy guy because of his business experience. The Bain attacks from the GOP primary and the Obama Campaign have his Bain experience down to being a positive with only 21% of the electorate… They’ve basically eliminated it from the equation before they’ve even moved on to his epicly awful MA job creation record. It’s been effective.

  14. Jeremy R says:

    Reagan budget director David Stockman on how the Leveraged Buy Out business has nothing to do with job creation:
    http://www.youtube.com/watch?feature=player_embedded&v=Fu4-6o44d6M

  15. André Kenji de Sousa says:

    When I was a kid there was a very popular restaurant chain in Brazil. They offered a pretty good roast chicken in restaurants that were located next to major highways. You could buy the roast chicken and other foods to eat when you arrive at home, you could eat at the restaurant. They also had a store, where you also could all kinds of things, like candies, fruits, etc. It was a very nice business preposition because it offered a nice place to stay during a long highway trip.

    Then, a private equity based firm bought the chain. The food is now horrible and expensive, the roast chicken that was the symbol of the restaurant does not exist anymore. My problem with Bain Capital is that private equity is precisely that: management aiming short-sighted profits, with excessive cost cutting(Someone has to pay the salaries of the CEOs), with no innovation, and without any respect for customers.

    This kind of management is destructive, you don´t have to hate capitalism to recognize that.

  16. David M says:

    I liked the Tony Soprano narrated version of the ad better.

  17. michael reynolds says:

    Kinda looks like you won the thread there dude.

  18. jan says:

    @Septimius:

    “So, let me get this straight. Bain Capital bought a steel company on the verge of bankruptcy, invested $100 million into it, kept it going for another 8 years before it finally went bankrupt (2 years after Romney left Bain). Only in the fever swamps of the liberal mind could this be considered a negative. “

    Yes, but the hypocrisy gets more out there in those ‘fever swamps!’

    Jonathan Lavine is a top Obama bundler, who is also a managing director at Bain. In fact, Mr. Lavine, was at the firm when GST Steel Plant in Kansas went bankrupt. But, people are all too busy pointing fingers at Romney, who had left 2 years earlier, heaping criticism on someone who was elsewhere, rather than someone who was actually was front and center at the time of the bankruptcy. It’s a circular story that keeps going back to Obama and his handlers, money guys, private equity connections, etc.

  19. OzarkHillbilly says:

    @Ron Beasley:

    Rich may hire people but they don’t create jobs – it’s customers that do that.

    I have to say Ron that this hits to the heart of my argument (that I don;t think I have articulated here yet)

    PEOPLE do not create jobs…. Neither do CORPORATIONS…. (If they did, they would be “job destroyers” as well..)

    Economies create jobs. They also destroy them.

    Everybody else is just following the herd.

  20. Exasperated says:

    This may fly with the “chumps” but for the rest of us, not so much. Could it be that both parties are embarrassing as evidenced by Mr. Clyburn’s goofy remarks? Who, except for the very young, doesn’t get that paid shills cherry pick the facts to create somemawkish scenario of contrived outrage?
    Be wary of people who don’t comprehend this and expect the goal posts to be moving when one scenario falls as flat as “Armco was a thriving quality steel maker before being gutted and stripped by Bain”. What a joke; they lost $600+ million dollars before the acquisition per the WSJ.

  21. WR says:

    @Hey Norm: Wow, first you quote Harold Ford, now Lanny Davis. You’ve clearly got your finger on the pulse of the Democratic mainstream. We must be doomed!

  22. Jeremy R says:

    @WR:

    Wow, first you quote Harold Ford, now Lanny Davis. You’ve clearly got your finger on the pulse of the Democratic mainstream.

    Quick! Someone find out what Pat Caddell and Doug Schoen have to say about this!

  23. Drew says:

    Its nice to see that an OTB essayist has taken up the subject in earnest.

    While it a fair and correct observation that private equity (or as Doug correctly points out “any business”) is not set up with the goal of creating jobs, it does not follow logically that they don’t. In fact for two segments of the private equity business, venture and growth LBO (the dominant segments) it is the pursuit of growth and increasing profitability that create the conditions for job creation. In the third segment, turnarounds, it would more correctly called job preservation.

    How many know of declining businesses that create jobs? That current dynamo of buggy whipmaking, perhaps? How about those absurd “stars-in-the-eyes efforst like braod based solar energy. Silly. And at this juncture, for those who tend to invoke the immature observation of “profits vs jobs,” I must observe you have no clue about capital mobility, and the impossibility of preventing it. You can throw a temper tantrum, but you will just end up with sore limbs and disappointing reality.

    As for some Bain specifics. Let’s first take the tremendously dishonest attitude towards steel operations, my original industry. For those of you who don’t know, the Armco Steel operation that was spun off to help form GST along with Georgetown Steel were dog operations destined for shutdown. It made grinding balls and wire rope. In steel, this is the equivalent of making buggy whips, and is super low value added. Grinding balls are used to crush aggregates for mining. Wire rope is used to pull mining cars, as well as in dredging operations etc. Those markets were flat on their backs and Bain thought they could make a go of it. Foreign competition, along with union intransigence eventually took the company down. And 700-800 jobs were lost. If you look at the steel industry in its 80’s and 90’s totality employment contracted by 2/3rds. Let’s contrast Bain and Steel Dynamics, a manufacturer of modern products in a non-union environment in Indiana. 6000 jobs, from scratch. You tell me which you prefer.

    We can go on and on about successes. There’s alot of retail. notoriously volatile. But Staples has gotten alot of press.How many jobs? Brookstone, Dominoes, Guitar Center, Dunkin Donuts.

    How about HCA? Alliance Laundry?

    And if you look at their coinvestors, its like an All-Star team. Clayton Dubilier. Goldman. Tommy Lee, KKR and on and on. Its like Michael, Magic, Scottie etc.

    As for is this a good background for a President? Well, noted solar venture capitalist Barack Obama and is Secy of Energy clearly fall short. I think Mitt Romney at least understands the basic environment conducive to business growth, and yes, therefore employment. Empirically, Obama is a total dud right now.

    I’ve long known the majority of the commenters here just don’t know crappola about business, much less finance. Some do. But the thread was disappointing. I can chalk up much of the drivel to ignorance. But some is clearly just dishonest partisanship. Whether you support Mitt Romney for President or not, attacking his investment and management record is an act of deliberate public humiliation.

  24. Hey Norm says:

    @ WR…I didn’t quote Lanny Davis.
    @ Jan…you forgot to mention the millions in corporate welfare Bain collected.
    @ Doug…1st OWS wasn’t working but they changed the national conversation. The Obama’s populism wasn’t working but his numbers went up. Now focusing on why the Bain experience has no bearing on the office of President isn’t working.
    Wait for it.

  25. Jeremy R says:

    @Drew:

    Romney has run from his actual relevant experience (his governance experience in MA) because his job creation record was anemic and because he’s cowering from his base, so instead he’s tried to market himself as a job creation wunderkind and a macro-economic turn-around artist, based on his Bain experience. You say attacking his Bain record is “an act of deliberate public humiliation,” well, I don’t know about that, but when that’s what he’s used as the central pillar of his candidacy, challenging that record is basically a prerequisite for any opponent who’s actually campaigning to win. It would be like Romney not challenging the President on various aspects of his first term narrative.

  26. steve says:

    1) There is zero evidence that being a good businessperson translates into being an able politician.

    2) Most of the jobs cited by Drew are not really what we need. Look at Staples. If we did not have Staples, we would be buying from a larger Office MAx or WalMart. This is local, retail marketing. Doing it better means you do it with, maybe, 2% fewer people while making a profit. Ok, we need this in our economy, but what we really need are new products. We need innovation. Based on Romney’s past, and the companies Drew cites, our future is finding cheaper ways to sell donuts and stuff made in China. That is not the path to prosperity for the US. One Jobs is worth more than a dozen Romney’s.

    Steve

  27. jukeboxgrad says:

    david:

    I liked the Tony Soprano narrated version of the ad better.

    Wow, that thing is awesome. Everyone should watch it. It tells the truth about ‘private equity:’ that it’s a bunch of crooks from good schools in good suits.

    See it on youtube if you want to be able to avoid an annoying commercial.

  28. WR says:

    @Hey Norm: Sorry, that was meant to be addressed to Doug. I promise I’ll never confuse you two again!

  29. WR says:

    @Drew: Dishonest drivel? You mean, like justifying Bain looting millions from the companies they run into the ground by bringing up — yes, the biggest cliche of the right wing — buggy whips? Why don’t you actually address the point of how much Romney pulled out of the steel company before died of the wounds inflicted before he got there? How many hundreds of millions in “management fees”? How much debt was loaded on to the company that went right into his pockets?

    In fact, why don’t you stop lecturing us all on your brilliance and actually address the real objections to Romney’s business practices? Or is it that you can’t, so you need to bluster about how smart you are and hope we let you change the subject?

  30. jukeboxgrad says:

    septimius:

    So, let me get this straight. Bain Capital bought a steel company on the verge of bankruptcy, invested $100 million into it

    If you’re trying to “get this straight,” you need to keep trying. No, it’s not honest to claim that Bain “invested $100 million into it,” because that suggests that Bain provided that much capital. Trouble is, they didn’t. The amount of capital they provided was much less:

    The L.A. Times said Bain invested a total of $24 million in the entire steel company deal (including the merger in South Carolina) and ended up with a $50 million return — “a 100 percent gain.”

    Reuters also noted that Romney continued receiving dividends from Bain after he left, and Bain collected $900,000 a year from the steel company for management consulting services through 1999.

    Yes, Bain issued this dishonest statement: “We invested more than $100 million.” What they didn’t tell you is that most of that money was borrowed money, not Bain’s money. And the whole idea of using lots of borrowed money is that Bain can dress up the books, make a killing, leave town, and then let the bankruptcy be someone else’s problem. This is sometimes known as financial engineering, which is a genteel way of saying ‘racket.’ It has nothing to do with real entrepreneurship.

    ‘Private equity’ is called ‘private’ for a reason. It means this: ‘we like to keep things private because it’s much better if no one really understands what the hell we’re actually doing.’ Making dishonest statements like “we invested more than $100 million” is part of that same philosophy. It’s no surprise that Mitt was a virtuoso in private equity, because he’s a virtuoso liar.

  31. jukeboxgrad says:

    doug:

    Obama’s Bain Attacks Aren’t Working

    It’s way premature to say that. Here’s a big reason why. From WSJ, 5/25:

    A Wall Street Journal/NBC News poll released this week showed the majority of voters—53%—haven’t heard of Bain Capital

    That number is large and important. People like us were paying close attention a few months ago when Gingrich and Perry made a fuss about Mitt’s vulture capitalism, but most voters were not. And Obama has just started pushing this message, and most people haven’t heard the message yet. So on this issue, Mitt has nowhere to go but down:

    The poll showed that among those who have heard of Bain, 19% view the firm negatively, compared with 9% who view it positively.

    Chances are that pattern won’t change.

    Every day that people are talking about Bain is a bad day for Mitt, and there are going to be a lot of days like that. He set that up when he decided to package himself as a ‘job creator.’

  32. michael reynolds says:

    Romney is citing Bain as evidence that he can “create jobs.” An interesting claim given that Republicans don’t believe government can create private industry jobs.

    So basically Romney is saying this: Because I ran a business I can use government to create jobs despite the fact I don’t believe that government can create jobs.

    In other words, by his own standards, according to his own belief system, he’s lying.

    And what exactly are his other claims to the presidency? RomneyCare? Selling sponsorships for the Olympics? Hello? Anything?

  33. jukeboxgrad says:

    what exactly are his other claims to the presidency?

    He knows what it’s like to hold someone down and give them a forced haircut while they cry and scream for help. So if that’s the experience we’d like to have, he’s the right man to deliver it.

  34. Herb says:

    there doesn’t appear to be any evidence at this point that the attacks on Romney’s record at Bain are resonating with the public at all.

    Depends on how you look at it….

    There’s also no evidence that the public is buying Romney’s Bain record as a compelling reason to elect him either. It seems many commentators are judging Obama’s Bain attacks not as an election strategy, but as the opening salvos in an overall “War on Private Equity,” a war that will not occur and that no Democrat really wants to wage.

    What we have here is the Obama campaign Rovingly going after Romney’s strengths. Two months from now, we’re not going to hear Mitt Romney talking about all the jobs he created with Bain like he wants to. “Vote for me. I’m good at business.” Nope, he’s going to be lying about the president’s fictional “War on Private Equity,” raising all kinds of boogeymen, scaring the folks. “Vote for me. Because the other guy will drink your milkshake.”

    It’s almost as if Obama is playing on the paranoia, straw manning, and bad faith endemic on the right wing, knowing full well they will not be able to resist.

  35. This is a funny article. In the body you accept Steve Rattner’s argument that capitalists are not primarily about job creation. That’s huge, and is a win. Obama’s attack “worked” in that it set back the old “I created 100000 jobs” line and the whole “rich men create jobs” sentiment.

    In fact, look at Drew’s first comment, as the voice of rich business:

    While it a fair and correct observation that private equity (or as Doug correctly points out “any business”) is not set up with the goal of creating jobs, it does not follow logically that they don’t. In fact for two segments of the private equity business, venture and growth LBO (the dominant segments) it is the pursuit of growth and increasing profitability that create the conditions for job creation. In the third segment, turnarounds, it would more correctly called job preservation.

    Do you see a promise of jobs there? I don’t. In fact it talks about “higher productivity” which, unfortunately can be achieved two ways. You can make more money, or you can reduce workers. Oh, or you can increase the use of foreign plants and suppliers, and then not count their workers when you calculate on-shore US productivity numbers.

    Does that, as in Drew’s weak claim, “create the conditions for job creation?”

    If so, the conditions have been in place for some time, right? Corporate productivity, corporate profits, and corporate cash are way up. Where are those jobs?

    I’m pretty sure they were pretty close to “promised” some time back.

  36. Mikey says:

    As someone who has a job because a private equity firm bought my company before it went under, I’ve got a bit of an “insider” perspective.

    First, yes, there were layoffs, but (in my opinion) 90% of them were people who shouldn’t have been there in the first place. The layoffs were a good opportunity to shed the worst performers.

    Second, yes, I understand the acquisition has nothing to do with “creating jobs” and everything to do with getting the company profitable and taking it public. GOOD. A profitable company benefits all us employees because our bonus structure is tied to profitability. The equity firm will benefit greatly, of course, but so will we. And an IPO means we get stock.

    None of us is harboring any illusions as to the motivation of the private equity firm. We know what they’re about. But, in today’s shaky economy, it’s private equity or bankruptcy, and bankruptcy would probably mean 10,000 more of us on the unemployment line. Hell, some of us might end up there anyway, but at this point it’s been five more years of employment than we would have had otherwise.

    The Bain line of attack is dishonest, exploits ignorance rather than trying to educate, and is willfully misleading–in other words, it’s everything that’s wrong with modern political rhetoric.

  37. @michael reynolds:

    Romeny was never going to do a Green Jobs program. He was going to position himself in the traditional GOP position, saying that his role in government was to reduce roadblocks to business and employment.

    I think there are roadblocks, but not the “convenient” ones the GOP likes to push. They want lower taxes and an elimination of the EPA or something.

    They’d be better off starting with Alex Tabarrok’s Launching the Innovation Renaissance … but the anti-IP stuff might be a little anti-corporate for the mainline GOP. Too bad, because unlike Romney’s replay of the GWB method, Tabarrok’s tweaks might actually work.

  38. @Mikey:

    I think you missed the key. If you cut taxes on people making over $250K per year, and reduce food stamp payments, will that help private equity “create or save” jobs(*)?

    Because that’s what the Ryan-Romney budget is actually about. It shifts burdens and benefits to favor the rich, on the argument that doing so will free them to create jobs.

    * – it is slightly amusing that “create or save” was roundly laughed at when Obama did it.

  39. Herb says:

    @Mikey:

    “The Bain line of attack is dishonest, exploits ignorance rather than trying to educate, and is willfully misleading”

    And yet your response indicates you’re more familiar with the caricature of the Bain argument rather than the actual argument that’s being made. (In other words, way to beat the stuffing out of that straw man.)

    I know it’s easier to defend private equity firms in general than it is to defend Bain’s operations specifically. But to do so while crying about dishonesty and being misleading is rich.

  40. jan says:

    @michael reynolds:

    “So basically Romney is saying this: Because I ran a business I can use government to create jobs despite the fact I don’t believe that government can create jobs.”

    What Romney is saying is that by working in the private sector he knows what it takes to run a successful business, saving it from it’s own mismanagement errors which oftentimes leads to business failures. Businesses also run aground because of too much government interference and over-regulations.

    Therefore, by re-wiring government’s relationship to business, the private sector will be able to inject more energy into it’s businesses, thus creating more jobs. This is a far different role that Romney wants to instill in job creation by the government, in that he wants it to step aside more and quit blocking job creation. This interpretion is also far different than what you are trying to spin, Michael.

  41. michael reynolds says:

    @jan:

    Now explain to me how Romney’s approach is any different than George W. Bush’s — also a Harvard MBA — and why we would get a different result by doing the exact same thing.

  42. jan says:

    Reading through threads here are both humorous as well as alarming. They’re oftentimes ‘funny’ because the adamancy of claims is fueled mainly by purist ideology rather than hands-on knowledge. The repetition of ‘talking points’ is also amazing, as if they were on some kind of speeded up political conveyor belt.

    It’s ‘alarming’ because people don’t seem to read nor respect the posts of those who actually have knowledge or experience with the type of businesses described. For instance, ‘Mikey’s’ own job has been served well by the augmentation of private equity firms. ‘Septimus’ gave a succinct overview of investment outlay, time involved, which ultimately ended with one company’s financial reprieve not working out in the end. Then you have ‘Drew,’ who actually knows the steel business, giving an informed appraisal and details surrounding it’s operations. What follows, though, is a stream of biased responses, cawing and downing these serious remarks with ludicrous, generalized and juvenile reasoning.

    So many of you just see Romney as a political opponent, a republican. No matter how many bases he is able to tag, or business acumen he has shown, you simply call him ‘out’ because he is not of your political ilk. You wil also downplay, or overlook altogether, the terrible economy and healthcare mess he ‘inherited’ in MA, and how he actually turned deficits, UE, and HC around in that state in 4 years, and instead call his governorship sub par or a disaster.

    But, when it comes to Obama, his ‘inherited’ financial crisis becomes a permanent excuse to blame a predecessor for the continuing fiscal malaise in this country. He is now even foisting the almost trillion dollar stimulus, signed and pushed by him, onto the previous administration’s back so as to make himself appear more fiscally conservative for the 2012 election! And, even though there is an infestation of private equity firms, lobbyists, scandals, high deficits, no budgets, skewed UE numbers, slow to no growth indicators, burdening his first term in office, Obama is just ‘fine’ to put in place for a second term.

    …simply stunning.

  43. Mikey says:

    @john personna:

    That’s a whole separate question from whether or not private equity = vultures swooping in to pick at the zombified corpses of companies and then dump the hapless employees into the meat grinder.

    I think many of the Republican political pronouncements are just as dishonest as this one about Bain. “Tax cuts automatically equals jobs added” is one of those.

  44. André Kenji de Sousa says:

    The idea of Private Equity just searching for poorly run companies to buy and then do turnaround is romantically, but it´s not entirely true. There are lots of times when they buy smaller companies. It´s also common that the company founder dies and their family does not want to have the work to run the company.

    I think that Romney´s record as governor is more important, but, then we´d not only be discussing his relatively moderate record, but the fact that e has only four years of political experience. There is also the point that he would be trounced in a landslide had he run for reelection. It´s Romney that wants to discuss his record at Bain.

    My point is that financially-driven management is destructive. The best run American companies are companies where Wall Street and firms like Bain have no say, like Amazon or Apple. Asian and European companies like Hyundai, Samsung and Volkswagen looks like to be so efficient when compared to their American counterparts precisely because they does not have Wall Street or Bain oriented management.

    Toyota could build the Prius brand because there was no Bain Capital or no Wall Street demanding fast and big dividends. Ford or GM could not because there was these MBA styled managers demanding fast profit. Mitt Romney is not the kind of manager that America needs.

  45. PogueMahone says:

    @jan:

    Therefore, by re-wiring government’s relationship to business, the private sector will be able to inject more energy into it’s businesses, thus creating more jobs.

    How? What specifics? When, where, and what was it that Romney said he wanted to do to re-wire government’s relationship to business?

    BTW, “private sector will be able to inject more energy into it’s businesses, thus creating more jobs” is the same meaningless vague platitudes like “getting government out of the way” and “end destructive government regulations”. For any of that to have any real meaning, it must be accompanied by specifics.

    You make it sound like you know what Romney is saying better than Romney does. Enlighten us, please.

    Cheers.

  46. michael reynolds says:

    @jan:

    Hah! Democrats aren’t the ones downplaying Romney’s job as governor, Romney is. He’s terrified of admitting that RomneyCare = ObamaCare. He’s terrified of admitting that he was pro-choice. Every time he opens his mouth about his Massachusetts years he’ll point up what an empty fraud he is.

    And I don’t see your explanation of how Romney’s economics is any different than Bush’s.

  47. Mikey says:

    @Herb: Insofar as the caricature of Bain is being used to bash Romney, and private equity firms in general, of course I’m going to address my remarks toward the caricature.

    But I do agree with Bain’s defenders that private equity in general plays a valuable and necessary role, in that it can often find companies that are in dire financial straits but still salvageable and carry them through the hard times. That this does not always succeed is irrelevant–would we rather have 50% of such companies fail, or 100%?

    All that being said, I think Romney’s tactic of trying to use Bain as he did was unwise and he pretty much set himself up for this line of attack.

  48. Jenos Idanian says:

    It’s amazing — and entertaining — how many of the anti-Romney attacks have turned around on the Obamabots.

    Romney negligently abused a dog. Obama ate one.

    Romney’s a member of that crazy, scary cult called Mormonism. Obama spent 20 years as a devoted follower of Jeremiah Wright.

    Romney’s company shut down a steel company, throwing hundreds out of work. Which happened two years after Romney left, and was headed by a guy who’s now a major Obama bundler.

    Now, it’d be fun to compare Bain Capital’s record on jobs with Obama’s “Green Energy” initiative, and the lengthy list of companies that failed — putting a lot of people out of work — after the Obama administration gave them large amounts of loans and grants. Of course, that’s not a fair comparison; Bain only played with its own money and that of its investors; Obama played his games with our tax money.

    And remember, Obama’s biggest achievement on job creation before he became president was helping his wife pull down six figures at the University of Chicago Hospitals, where her work was so critical that when she left, they didn’t bother to replace her. At least Ann Romney’s horse hobby isn’t paid for with taxpayer money.

  49. michael reynolds says:

    @Jenos Idanian:

    Of course it doesn’t stop with your comparisons, does it? RomneyCare is the same as ObamaCare, Romney was pro-choice before he was anti-choice while Obama was anti-Gitmo before he was pro-Gitmo. So many similarities. Obama evolved on gay marriage, Romney devolved.

    And of course Romney’s work first as a missionary and now as an official in the LDS church is the equivalent of Obama’s community organizing. Right?

    So you’re arguing that Obama and Romney are roughly equal. Okay then, I’ll take the one with actual government experience.

  50. KansasMom says:

    @jan: Wow jan, you just used a whole lot of words to say what you could have just as easily said with a sound that every newborn knows, WAAAAHHHHHHH!

  51. WR says:

    @Jenos Idanian: Chapter 12, in which Jenos rediscovers the joy of the false equivalence and realizes he never even has to pretend to make a point again.

  52. jan says:

    @michael reynolds:

    “Now explain to me how Romney’s approach is any different than George W. Bush’s — also a Harvard MBA — and why we would get a different result by doing the exact same thing. “

    Why are we bringing Bush into this? Is that because you lump all republican’s as only being able to perform in one way?

    I think it’s far more pertinent to talk about how Romney’s approach would be different from Obama’s. don’t you think, as there are only two choices —> Romney and Obama!

    The problems we now face are fiscal impairment. Our economy is not moving, nor is it generating the type of employment opportunities we need or the revenues required to run the country. Borrowing has only increased our deficits. Printing more money and keeping interest rates artificially low has only weakened our dollar. The stimulus has reaped few benefits, and mainly deepened our debt and aided in softening our credit standing. Growing government has discouraged self-reliance in people. And, extending the tax breaks have done little because businesses look beyond a year’s reprieve when calculating their investments.

    We need a leader who understands the market place, is more pragmatic than ideological to oversee unpopular changes in fiscal policy, as well as being able to work across the aisle to bring a contentious Congress to a place where real tax and entitlement reforms have a chance.

    Romney has done that in his MA experience. He brought deficits and UE down (it was higher when he first took office), reforming HC in a way that is still seen approvingly by the majority of people and physicians in that state. Here, there was a working consensus created with a legislature that was 85% democratic — a far greater percentage of opposition than Obama has ever faced. Romney’s record is what I am looking at, a record that has been dismissed and distorted by democrats and the MSM, in their passion to make Obama look good.

    Having said this, it remains to be seen, should Romney be elected, if he can both have the backbone and flexibility to make the changes that need to made, and coalesce enough people around his ideas to forge positive policy reforms. But, one thing for certain is that Obama hasn’t been able to do this. He is distant from his own party members. He stays out of the fray as much as possible letting people like Pelosi take control as well as the hits. The two budgets submitted by him have been more symbolic, garnering not a single vote for passage from either republicans or democrats.

    If Obama is reelected, like the majority of you want, we will only see another 4 years that will be identical, or worse than the last four. However, if Romney is elected, there is at least a possibility of a change in course that will be better. His fiscal competence and working business relationships have already been tested. His years as a governor were more productive than the presidential years of Obama.

    IMO, Obama was given the reins of leadership and failed. It’s time for another change….

  53. jan says:

    @KansasMom:

    Your’s is an example of an idiotic reply. It takes no brain power to be glib, nor does it extend the dialogue into anything but a jab.

  54. KansasMom says:

    @jan: @jan: Sorry, I live with a 4 year old a couple of 2 years olds. Whining is my pet peeve.

  55. michael reynolds says:

    Why are we bringing Bush into this? Is that because you lump all republican’s as only being able to perform in one way?

    I think it’s far more pertinent to talk about how Romney’s approach would be different from Obama’s. don’t you think, as there are only two choices —> Romney and Obama!

    That doesn’t even qualify as a nice try.

    We have two sets of policies — those of Mr. Bush and Mr. Romney, who are identical on economic issues, and those of Mr. Obama.

    After 8 years of the Bush/Romney theory we had zero net jobs, collapsing banks, financial panic, a massive deficit and debt, and a recession that came within inches of being a depression.

    After 4 years of Mr. Obama we have a sputtering, weak recovery, massive but leveling deficit, massive debt, a relatively stable financial sector and a strong stock market.

    Now you’re arguing that we should back to doing precisely what got us into trouble in the first place.

    The Republican argument is this: Remember how we f*cked everything up so badly that Obama couldn’t fix it? Let’s go back to the guys who f*cked it up to begin with.

  56. jan says:

    @michael reynolds:

    “He’s terrified of admitting that RomneyCare = ObamaCare. He’s terrified of admitting that he was pro-choice. Every time he opens his mouth about his Massachusetts years he’ll point up what an empty fraud he is. “

    Again, Michael, it’s your interpretation that is talking. However, is it a correct interpretation? Romney has explained his HC legislation in MA, as well as his abortion stances, over and over again. But, those, on both the right and the left, only take what they want from it and then dish out their own conclusions.

    Healthcare was cratering the MA economy when Romney became governor. The government was threatening to cut off medicaid funding. The legislature and independent groups were in the process of putting together a haphazard HC plan. So, he collaborated with people, from all sides of the political spectrum, to come up with a more suitable state HC solution (isn’t that what we need in today’s polarized environment?). Even the one created, by a consensus of right/left consultants, had 8 parts vetoed by the democratic legislature before it finally passed in a compromised format.

    Romney’s own life and religious practices have shown his pro-life stance. Like Mitch Daniels, though, he didn’t stress these social issues in his political life, and has focused more on where his expertise was, the fiscal arena. People, though, like to twist his personal/political history around, for instance, taking nuances of one donation to a pro-choice group to mean more than what his entire life has depicted.

    Again, you all look at Obama’s philosophical evolution on various social issues as being so authentic, as you hold Romney up against a wall of criticism for what amounts to a similar metamorphosis. Isn’t that called being hypocritical, or using a double standard?

  57. jan says:

    @michael reynolds:

    Michael,

    …..however, Obama has basically been an extension of so many of the Bush policies, hasn’t he? At least that is what an increasing number of political pundits are saying.

    While Obama complained about Bush, when he was doing his electioneering, he ended up following in the same vein once he was in office — Guantanomo, continuation and amping of Afghanistan, the tax cuts, no immigration policy (although Bush did try), higher deficits than Bush, more spending than Bush, a smaller work force than when Bush left office (which accounts for the less than accurate UE numbers). The men are one in the same, in so many ways, which is why I think it would be much more accurate and honest to talk about Obama (our current president) and compare and contrast him to his opponent, Romney.

    Bush is gone. Obama is the one in office. It’s Obama’s policies that run the country — actually, are running down the country. It’s time for libs to get past the Bush excuses.

  58. anjin-san says:

    actually, are running down the country

    Tell us Jan, if you could go back to the economy as it was on Bush’s last day of office, would you? Or would you stick with what we have today?

    That is a yes/no question, btw…

  59. grumpy realist says:

    @Mikey: They would do a damn better task if they didn’t at the same time load up the new beasties with debt, suck out all the money they can with high “management fees”, then, when they can’t service the debt, whine to the courts how they have to now go after the pension plan. Restructure THAT, strip out more money with more high management fees until the company goes bankrupt. Then they shrug their shoulders and walk away.

    Sorry, but if the company you have invested in goes bankrupt, you shouldn’t be making 200% plus return on the money you put it. Explain to me how you haven’t just created a “heads I win, tails you lose” situation.

  60. michael reynolds says:

    @jan:

    And how does Romney differ from Bush?

    Even if I accept your premise, (I don’t) you are now arguing the following:

    1) Obama = Bush

    2) Romney = Bush

    Therefore vote for Romney.

    You see the logic fail there?

    I’m struck by the fact that I have not yet seen anyone — including the candidate — make any sort of positive argument for Romney. The sum total of the argument is that Romney was a venture capitalist (evidently he was not governor of Massachusetts and did not pass RomneyCare) and he is not Obama.

  61. jan says:

    @michael reynolds:

    You’re the one, Michael, who said Romney = Bush, not me. The comment I made was that more and more people are saying that Obama has been following Bush’s policies. You’re twisting my post to fit into your assertions. Because Romney and Bush are both affiliated with the republican doesn’t make them the same man. It’s similar to Obama and Clinton both being dems, but certainly governoring in different ways.

    Furthermore, I am encouraging people to compare Obama’s policies with Romney’s track record in MA was, which was explained above, but will probably go through equal distortion. In comparing the two men who are actually running for POTUS in 2012, instead of dragging a previous president in, like he was a current contender, people can not only look at the actions of Romney but also his “promises.” That’s essentially what people voted Obama on, was his promises, as he had no real legislative record!

    Also, you Michael, will probably never be satisfied with anyone’s positive argument for Romney. You will either superficially peruse it, or it simply will not be able to get past your partisan filter.

    For instance, I’ve already brought up the lopsided democratic legislature Romney worked with, his deficit reduction and balancing the state budget. Look at the UE figures when he came into office, and then when he left. But, all the dems talk about is where MA stood on the scale of job creation in the nation, coming up with a figure in the high 40’s. However, it was 50th, and rapidly going south in 2003-2004, at the start of his term in office. He decreased it to the lower 40’s and then it went up again with the decline of the tech bubble in MA. In contrast, when Obama took control of the country the UE was somewhere around 6.9 to the low 7’s. It’s now 8.1, but would be higher if you were measuring a similar work force. It is currently the smallest work force in decades!

  62. anjin-san says:

    @ Jan

    Tell us Jan, if you could go back to the economy as it was on Bush’s last day of office, would you? Or would you stick with what we have today? Yes or no…

    It’s a simple question Jan.

  63. michael reynolds says:

    @jan:

    You’re the one, Michael, who said Romney = Bush, not me.

    Okay, tell me how they differ on economic policy.

    I am encouraging people to compare Obama’s policies with Romney’s track record in MA

    Your candidate isn’t. He talks about Bain and he talks about the Olympics. You know why? Because he’s disavowed everything he did as governor. He passed the model for ObamaCare and he has nothing else to point to. He did not create jobs in MA, he created socialized medicine and the individual mandate he now pretends to hate.

    In fact, Jan, your party doesn’t believe government creates private sector jobs. Remember?

    Your last paragraph is just funny. Short version: Romney accomplished squat, but it’s the fault of Democrats or economic factors beyond his control. Which of course is exactly what Obama is saying in reverse.

    So, sorry, unless you can show me how Romney differs from Bush (and you can’t) it remains that you are arguing:

    Romney = Bush = Obama. Which leaves you to explain how the conclusion is “vote Romney.”

  64. James says:

    @jan: Since you’re so adamant for “libs” to engage your assertions:

    Romney has explained his HC legislation in MA, as well as his abortion stances, over and over again.

    He has. Each time he just gives a different position.

    when Obama took control of the country the UE was somewhere around 6.9 to the low 7′s. It’s now 8.1, […]

    You’re completely ignoring the ~9% contraction US GDP underwent in 2008’s 4th quarter; a final, if not fitting, parting gift from the George W. Bush administration. You’re free to play around with economics numbers, but you’re pretty nakedly ignoring context to suit your conclusions. At any rate, it’s quite rich how you’re accusing others of “partisan filters”.

    Bush is gone. Obama is the one in office. It’s Obama’s policies that run the country — actually, are running down the country. It’s time for libs to get past the Bush excuses.

    This is rich. You want to “libs to get past Bush,” arguably, the most disastrous presidential administration in the modern presidency because….well…that’s just not fair? Or something?

    George W. Bush’s polices are the drivers of our current Federal Budget deficit. We’re still very much feeling the effects of Bush’s recession, and Mr. Romney has clearly stated in his positions that he would continue Bush polices and priorities of tax cuts for high income earners, and deeper cuts for healthcare and safety net spending.

    You’re just playing a plausible deniability game premised on this idea that “if Romney is elected, there is at least a possibility of a change in course,” when you know, full well, that Mr. Romney’s platform contains scant, if any, major departures from the last Bush administration.

  65. jan says:

    @michael reynolds:

    Like I already figured, Michael, you just distort replies that disfavor your own assumptions.

  66. Jenos Idanian says:

    @anjin-san: Tell us Jan, if you could go back to the economy as it was on Bush’s last day of office, would you? Or would you stick with what we have today?

    That is a yes/no question, btw…

    I think you mean “the economy as it was after two years of Democrats holding both Houses of Congress, or today’s after two years of the Republicans holding the House?”

    Here’s a little hint, chump: United States Constitution, Article I, Section 7.

  67. michael reynolds says:

    @jan:

    Anjin and I both asked you simple, straightforward questions you obviously cannot answer. That speaks for itself.

  68. Herb says:

    @Jenos Idanian:

    “I think you mean “the economy as it was after two years of Democrats holding both Houses of Congress, or today’s after two years of the Republicans holding the House?”

    I seem to remember Bush’s entire run was characterized by various bubbles, recessions, and stimulus checks. (I got 2 of them myself.) Contrary to wingnut opinion, electing Democratic majorities does not conjure economic calamity on its own.

  69. Jenos Idanian says:

    @Herb: And contrary to jackwagon blog arguments, I didn’t say that. But it is worth noting that the Democrats, while controlling both Houses and the presidency, couldn’t even pass a budget for two years — and the Senate has kept the streak alive.

    Here’s a little something from Civics 101 you obviously slept through: presidents can’t do much about the economy without at least a little help from Congress. Congress controls the money, Congress passes and repeals laws and regulations, Congress sets the tax rates. Bush took the 2006 elections maturely, and cooperated with the Pelosi/Reed Congress to get the things he cared about. Not the smartest move, but who really knew how wretched those two were?

  70. Herb says:

    @Jenos Idanian:

    cooperated with the Pelosi/Reed Congress to get the things he cared about. Not the smartest move, but who really knew how wretched those two were?

    Well, one thing can be said about the Pelosi/Reed Congress. They didn’t play chicken with the country’s credit rating like Boehner/Cantor did last year. They want to do it again this year, too.

    Not because they want the country to default on our debt. Because they want people like you to continue to complain about Democrats. “They didn’t pass a budget for 2 years.”

    Mann and Ornstein were right:

    Today, thanks to the GOP, compromise has gone out the window in Washington. In the first two years of the Obama administration, nearly every presidential initiative met with vehement, rancorous and unanimous Republican opposition in the House and the Senate, followed by efforts to delegitimize the results and repeal the policies.

    and

    This attitude filters down far deeper than the party leadership. Rank-and-file GOP voters endorse the strategy that the party’s elites have adopted, eschewing compromise to solve problems and insisting on principle, even if it leads to gridlock.

    Should have added, “Then they will complain about the gridlock as if that wasn’t the point in the first place.”

  71. Jenos Idanian says:

    @Herb: Well, one thing can be said about the Pelosi/Reed Congress. They didn’t play chicken with the country’s credit rating like Boehner/Cantor did last year. They want to do it again this year, too.

    Funny, it takes two to play chicken. And in an argument between “we shouldn’t keep spending billions and billions that we don’t have” and “we need to keep spending billions and billions that we don’t have,” I’ll side with the former.

    Maybe your side shouldn’t keep agreeing to raise the debt ceiling if they don’t intend to actually treat it like a ceiling.

    Or, you know, put forward an actual budget. That would be novel.

  72. Jenos Idanian says:

    @Herb: You know why people keep saying “they didn’t pass a budget for two years?”

    Because they didn’t pass a budget for 2 years.

    When you whine about people saying true things, your problem isn’t with the people. It’s with reality.

  73. Herb says:

    @Jenos Idanian: “And in an argument between “we shouldn’t keep spending billions and billions that we don’t have” and “we need to keep spending billions and billions that we don’t have,” I’ll side with the former. ”

    That wasn’t the argument. The argument was “Should we pay for the things we bought? Or become a deadbeat?”

    Maybe your side shouldn’t keep agreeing to raise the debt ceiling if they don’t intend to actually treat it like a ceiling.

    My “side?” You mean the fiscally responsible side that pays its bills? Or the side that incurs the bills, refuses to pay them, then points the finger at other people?

    Oh, if only we could bottle John Boehner’s tears…..

  74. Jenos Idanian says:

    @Herb: Dude, you’re arguing that borrowing more and more money equals “paying for things we’ve already bought” and “pay(ing) bills.” I can’t decide which sums up your attitude more — “why can’t I pay off my Visa with my Mastercard?” or “I can’t be broke — I still have checks left!”

  75. jukeboxgrad says:

    jenos:

    you’re arguing that borrowing more and more money equals “paying for things we’ve already bought”

    You have a hard time grasping the most basic fact about the debt-limit battle: it was indeed about borrowing money in order to “[pay] for things we’ve already bought.” And there’s a word for someone who thinks default is a better idea: deadbeat.

  76. Herb says:

    @Jenos Idanian: ““why can’t I pay off my Visa with my Mastercard?”

    Um…you can do that. It might even be a good idea. Surely you don’t need Suze Orman to explain why. Lemme do it: transfer a balance from a high-interest rate card to a low-interest rate card. Happens all the time.

    As to the debt limit….you must understand that the whole debate was not about how to pay for future spending, but how to pay for past spending that had already occurred. Good thing the GOP has people like you to NOT GET THAT and still carry water for their insolvency plan.

  77. Related:

    I recently was at a dinner in New York City and one of the people there was a very, very successful man who is on the borderline between venture capital and private equity. And this guy went into an extended rant about how he was at a disadvantage because he had to pay 15 percent capital gains taxes. When I was first dealing with venture capitalists in a significant way, the capital gains tax rate was 28 percent, and nobody was complaining. Then they got them reduced to 20 under Clinton, and then later 15 under Bush. Plus, they got a rollover provision so if they took the proceeds of a venture capital investment and rolled it over into a new venture capital investment it was tax-free. At that point, we’ve reached nirvana, what more could there be?

  78. @Mikey:

    That’s a whole separate question from whether or not private equity = vultures swooping in to pick at the zombified corpses of companies and then dump the hapless employees into the meat grinder.

    Yes and no. It should be a separate discussion whether private equity is useful to the economy (yes) and whether it provides a short term fix to economic recovery (no).

    The problem is, as you agree, Romney introduced his history at private equity as a pattern for economic recovery, including, explicitly, jobs.

    And so both parties play a broader economic policy battle on the ground that was given them.

  79. (Basically tying together those to previous comments, we’ve got guys ranting that 15% is too much to pay, on the argument that they are so useful to society … and then the fall-back that no, their first responsibility is to profit, and jobs are sometimes a side-benefit.)

  80. Also related:

    Hewlett-Packard’s chief executive, Meg Whitman, plans to cut 30,000 or more jobs next week

    You may recall Meg as a Republican candidate for Governor of California … one who ran on “jobs.”

  81. Jenos Idanian says:

    @john personna: Basically tying together those to previous comments, we’ve got guys ranting that 15% is too much to pay, on the argument that they are so useful to society …

    If you felt like being honest, you might add in the argument made: the money in question has already been taxed. So they don’t like the government double-dipping.

  82. Jenos Idanian says:

    @Jenos Idanian: It’s too late for me to edit that last remark, so I’ll just apologize: john, I am sorry. I should not have put in the “if you felt like being honest” line. I was in a pugnacious mood from some other comments, and should not have let it carry over into that one.

  83. john personna says:

    @Jenos Idanian:

    It’s not so much that it’s mean, its that it is hard to parse. Given that money circulates, most money has been taxed a few times. What’s special about capital gains?

    I don’t see a perfect match. Consider Apple’s offshore profits and their affect on share price.

  84. Jenos Idanian says:

    Basically, the money was taxed as income when the company earned it. Plus, “capital gains” are risky investments — I knew someone who had enough negative “capital gains” (just to be consistent) in one year to carry forward for about a decade.

    It boils down to this: do we want people to invest money in ways that have the chance of yielding capital gains? To me, the answer is obviously yes. So we need to offer incentives for doing so — a lower tax rate on investments is one way of mitigating the risks.

    Plus, as I said, it’s already been taxed. It was taxed when the investor got the initial money that they invested.

  85. I know that “mulitple taxation” is popular rhetoric in conservative circles, but there are reasons it doesn’t hold up.

    One, as I said above, it is not true that all profit from capital gains is covered by US corporate tax. There are offshore corporate profits. And then their are capital gains not derived from corporate income. There are all sorts of derivatives. There are commodity funds. There is real estate. There are currency bets. And on and on.

    Second, consider the VAT. Conservatives love it, but it is completely a “multiple tax,” coming in again and again as goods and services change hands. The theory must be that it doesn’t matter so much if a dollar was previously taxed, as much as it matters how much the total tax is, and if it restrains commerce.

    I could go on, but that should be enough. It is not true that all capital gains was taxed as corporate income, and it is not true that conservatives always oppose double taxation. They just do when (if you don’t think too hard) it makes an argument.

  86. BTW, I’ll repeat from that link above:

    But now we’re in this environment where this guy was loudly and aggressively complaining that he has to pay 15 percent to the government. And if that’s where you’re at, then of course you are going to complain about Dodd-Frank. You are going to complain about everything. If you have already got 96 percent of what you want, why not take the remaining 4? That’s where the culture of American finance is right now, and I think it’s really dangerous for the country.

  87. Meli B says:

    This is a great article. Obama’s platform of BAIN for his campaign is a joke.

    Too many families are struggling..but dont use woe tactics to rub it in. DO SOMETHING.