Just a few observations:
1) The broadness of Gingrich’s critique seems to vary by the minute. He has sometimes suggested that his objection to Bain concerns those cases where Bain made a lot of money even though the company it was trying to save died on the operating table. But he also says things like this: “If the rich guy is taking all the money and the working guy is being left an unemployment check, that’s not sound, healthy capitalism.” So rescuing the company isn’t enough, if it involves firing a bunch of people, which it sometimes does. In comments like that, Gingrich sounds like someone who has been a public employee for most of his life and has no understanding of how competitive markets work. I don’t think his narrower critique makes any sense, either, by the way.
2) Romney may in some sense be the “moderate” candidate in the race, but his business background and the likelihood that Obama will go after it means that his nomination would oddly raise the ideological stakes of the race: make it a referendum on free markets.
3) Notwithstanding his recent self-presentation, and perhaps his self-image, Gingrich has been very comfortable inside the party establishment. The way he’s campaigning now makes it less and less likely he will be able to find a home there after this campaign is over. He’s making himself radioactive. And it’s less and less clear that he’s operating on any rational understanding of his own interests, as opposed to gratifying his emotions.
I had questions about Newt's ethics. Nothing that has happened during the campaign has solved that. And they say Mitt has no core.
Reply to this commentLinkReport Abuse"I don’t think his narrower critique makes any sense, either, by the way."
Of course it does. Just look at what Bain did with KB toys: bought the company using the assets of the company itself as collateral. Forced them to take out giant loans in order to pay themselves $85 million. Then cackled all the way to the bank as the company folded under the massive debt a year later.
Bain profited tremendously and created exactly zero additional jobs along the way. Because, that's what companies like that DO. It wasn't a mistake. They find companies who are hurting, come in with needed cash, force the companies to pay them large amounts (for 'consulting fees') and then skip out when the whole thing crashes. Truly vulture capitalism.
And it won't stand up to a lot of public scrutiny. How many ex-employees of companies Bain shut down - all while putting money in Mitt's pocket - do you think Obama already has lined up? There are literally dozens of thousands to choose from...
Reply to this commentLinkReport Abusehehehehe...
Democrats don't understand the Free Market, it is vivid.
Reply to this commentLinkReport AbuseWhat an amazingly detailed and incisive response! But, can you go into more detail about how the looting of companies by Bain is how the 'free market' is supposed to work?
Look, Old Fan, as a member of Romney's paid political staff, can I ask you to try a little bit harder when it comes to defending the record of his company on issues such as this? It would be a lot more interesting than your incessant and vapid recitations of the same fluff regarding Romney.
Reply to this commentLinkReport Abuseyou think bain was buying healthy thriving companies and shutting them down? the companies they bought were distressed which is why the got them cheap. the idea was to turn them around. when a company is in trouble a lot of the time labor costs are directly responsible. but even in cases where it isnt its usually the easiest and fastest way to stop the cash from flowing out and provides money to be used to fix things. there was never a guarantee those companies could be fixed.
one major component of the free market is that non-competitive ocmpanies fall by the way side and that market share is snatched up by competitors. propping up a dying company is the worst thing that can happen to a free market economy.
Reply to this commentLinkReport AbuseOf course Bain isn't buying healthy companies - they are buying sick companies, and profiting tremendously on killing them. They aren't trying to save these companies or save these jobs, they are trying to loot a sinking ship.
When you buy a company and then force that company to take out large loans to pay your 'consulting costs,' you aren't doing anything other than dooming it to death and all the workers who work there to unemployment. Yay, free market economy!
At least the other former Bain executives are a lot more up front about the whole thing; they didn't see themselves as 'job creators.' They existed to make money for their clients, and that's it. Creating jobs was never anything but a rare side effect.
Reply to this commentLinkReport AbuseOf course creating jobs for other people is never anything but a "side effect."
It is not, however, rare, or anything remotely like rare; rather, it's the foundation of all employment:
Your employer pays you for your work not because he loves you, but because it's valuable to him and helps him make more money. If you can't figure this out, you are brain-damaged.
Back to your populist no-nothing water-hole, Mr. Fish.
Reply to this commentLinkReport AbuseSorry, embarrassing brain toot there: "Know-nothing," I meant.
Reply to this commentLinkReport AbuseI do think that misspelling 'know-nothing' is highly ironic, but I see that you corrected it quickly. Pretty funny though!
Regarding the creation of jobs: most employers at least TRY to create self-sustaining jobs and situations, that will create further wealth for their companies and investors for a long time, if not in perpetuity. Bain in many cases didn't even try that. They came in, bought up a sick company, looted everything they could from it, fired as many people as they could, and then left. That has nothing to do with 'job creation' at all. So, when Mitt calls himself a 'job creator' or anything even remotely similar, he's lying. Absolutely and totally lying.
Reply to this commentLinkReport AbuseHow did they buy up the company? I assume it was through the purchase of common stock.
Reply to this commentLinkReport AbuseDepends on the company in question, but I believe you are correct that this is how it is done in most cases. KB in particular was bought using guarantees of the company's OWN ASSETS! So, before Bain even acquired the company, they had already mortgaged the company to the hilt, just to do so...
Reply to this commentLinkReport AbuseWell if, for example they do it by making a stock purchase, that elevates the value of the stock for the shareholders who cash out. Big investors, small investors, mutual funds, pension plans, grannies, and all the rest. That leaves people the ability to reinvest, perhaps in more successful enterprises. What am I missing here?
Reply to this commentLinkReport AbuseYou're missing out on the 'loss of jobs' part. Yes, some institutional investors probably made a good amount of money off of Bain's purchase; but what about the poor schlubs working the counter?? Remember them?
This wouldn't come up at all if it weren't for Romney's penchant for referring to himself as a 'job creator.' That's the opposite of what his company did.
Reply to this commentLinkReport AbuseThat's fine, Fish. I'm not saying that we shouldn't be mindful of people who lose their jobs and, frankly, I wouldn't mind seeing us do something collectively to help get people back on their productive feet. I think Newt made a passing reference to something like this awhile back.
Having said that, whether a company is publicly traded, or not, it's still private property, and you still haven't made the case for what I think it is you want to do, which is to severely curtail how that property may be disposed of, nor do you appear to be fully cognizant of how such policies will come with adverse effects.
Reply to this commentLinkReport AbuseAlso, Fish I'd add that if Bain's actions diverted peoples productive capacities away from poor performing enterprises, that makes the economy more efficient in some marco sense, which does indeed lead to job creation.
Reply to this commentLinkReport AbuseI'm not advocating for any regulation to prevent what Bain was doing. The Vulture does indeed play an important role in the ecosystem. But, let's not pretend the Vulture is an Eagle.
Reply to this commentLinkReport AbuseThe fact that you describe the work of Bain as "looting of companies" means you don't have a real interest in wanting to know how the free market works. You think you know how it works, but you really don't. You're cynical of it - not skeptical. You are a leftist. Most everyone else here is not. Most everyone else here does not look at the business world or free markets like you do. You don't trust free markets. You like government interference, preferable a lot of it. Once you can wrap your head around that concept, you might earn some respect from more people who disagree with you, and who might want to give more thoughtful answers. Otherwise, you get back what you put into it.
Reply to this commentLinkReport AbuseThanks for your opinion! But, I don't agree with what you've written here. I've been studying the 'free market' here in America, both personally and professionally, for my entire life; and I feel perfectly confident in saying that it is a fantastic system, one with unlimited potential - potential for both profit and growth, and abuse and destruction. So yes, regulations are necessary; and I believe pretty much everyone alive agrees with me on that one, even if it's fun for you to hate on them.
I note that you have presented no factual rebuttal regarding how Bain treats companies it invests in, such as the KB example I gave above. I understand that it's difficult to discuss without coming to the conclusions I did, and that makes you loathe to do so, but hey; you'd better get ready for another 10 months of conversations exactly like this, because this is exactly what Obama/Axelrod will do, and it will be effective.
Reply to this commentLinkReport AbuseSo yes, regulations are necessary; and I believe pretty much everyone alive agrees with me on that one, even if it's fun for you to hate on them.
One of the many problems having a conversation with you is that you make up $#!% like this. You didn't define "regulations", you assume everyone loves them like you do, and you assume I hate them, whatever they are. That's a minimum of three levels of wrongness. Multiply this over a series of paragraphs, along with a economic knowledge superiority complex, and you have a convolution that few people here want to bother with.
Reply to this commentLinkReport AbuseCan you please limit your comments to a discussion of the actual topic of the thread? This is the second one in a row you've posted that carefully avoids any real discussion of the behavior of the company in question.
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