Romney to world: “We will we will cut you.”
Image: Boston Globe
Who is Mitt Romney? He’s a cost-cutter—and a cheapskate. He never met a cost he didn’t want to cut—unless it involved real estate for his wife Ann. When he talked this week about cutting waste at those companies he took over when he ran Bain Capital, that waste was largely jobs. He’s a job cutter. What’s more, he’s a debt loader. As one of the inventors—or early copycats—of corporate raiding, he perfected the art of buying companies, stripping assets, loading them with debt and selling them. That debt funded his takeovers, so the equity he destroyed was funded by the victim company. Sweet.
He may be moral in the limited church-on-Sunday sense of the word, but his ethics are mitigated by a strain of capitalism that destroyed millions of jobs in America; not by Mitt alone, of course, but by Mitt’s brand of Wall Street capitalism. So if you want a president who will gut the federal government not willy-nilly like Michele Bachmann would do, but strategically, Mitt’s your man.
Mitt doesn’t get investment. It’s foreign to his nature. When one of his top guns at Bain, Geoffrey Rehnert, bought a 1986 cell phone as an early adopter, Mitt castigated the guy, insisting that Bain’s anvil-of-the-gods-level corporate raiders use pay phones. If you want a federal government that offers benefits like the National Institute of Health, that tracks the spread of dangerous diseases, for example; that’s just…waste. Waste. Waste. Waste. That’s what Mitt sees. He’s a one-trick pony.
CBS News reports that the U.S. has lost eight million manufacturing jobs since 1980. A good number of those were not offshored, or cancelled due to lack of interest. They were caught in squeeze plays of the type that went down at American Pad & Paper Company in 1992. Here’s how the Boston Globe described the deal:
The firm [Bain Capital] put just $5 million into the deal, but realized big returns in short order. In 1995, several months after shuttering a plant in Indiana and firing roughly 200 workers, Bain Capital borrowed more money to have Ampad buy yet another company, and pay Bain and its investors more than $60 million - in addition to fees for arranging the deal.
One of the things that is hard to fathom about Mitt is how he can consider corporations to be people, too, and then torture them the way he does. It is ingenious how he accomplishes the mission to capture and destroy wealth using other people’s money—and certainly that is one of the hallmarks of the takeover industry. Frankly, if he had to use his own money, I don’t think he could stomach it. After all, this is the guy who, while raking in millions at Bain in the 1980s drove a Chevy Caprice with vinyl seats and a banged up front end to work every day. But rather than this just being another example of financial perversity in Boston, there is a method to this madness. That car was driven strictly for show. Mitt’s message is that he wants you to live within your means. He’s the austerity guy, or rather, he wants you to be the austerity guy, or gal.
Yes, I know, he’s a contradictory guy if you count his tens of millions in real estate holdings (all for Ann), $100 million in family trust funds (lots of kids) and that unfortunate $10,000 wager (made only to “prove a point”). But you—austerity suits you. Investment? That vision thing? Not so much. Cut, cut, cut; that’s Mitt. I’m not saying he’s alone here, or that he’s a nutcase. Angela Merkel is pretty much on the same page. And we shall see whether her propensity to ignore the fact that nations must grow their way out of debt, which of course they can’t do while under the yoke of draconian austerity, will lead to redemption or disaster. I predict the latter. Mitt, not so much, I would bet.
Why a gazillionaire who owns a stable of homes and packs a net worth estimated at $200 million would rent a U-Haul to move his family’s stuff between them I don’t know. He’s frugal. This point is driven home by son Tagg as quoted in an illuminating article in the New York Times, “Two Romneys: Wealthy Man, Thrifty Habits .” “There isn’t much that bothers him more than wasting money,” says his son. I just have this feeling about him as president…that he is going to view a rather large slice of governance as simply...wasting money.
In this sense, he actually aligns perfectly with the Tea Party, and that, too, is a little hard to reconcile. Newt (Tiffany) Gingrich is a spender. Herman Cain was the same, an upgrade guy. Lots of folks the Tea Party has embraced or is now embracing are simply not on the same page about WFAs (WasteFraud&Abuses). But Mitt is. Here’s my bet: he would gut government (except defense, always except defense) more efficiently than any sane candidate out there in Primaryland. (And yes, I have employed the Bachmann exclusion.)
There’s this relativity that’s troubling. At the risk of quoting excessively from the Times article, Romney is kvetching about Bain Capital capitalists using their own money to buy some shares in a private jet—because Romney’s Bain, of course, won’t. As related by Marc Wolpow of Bain:
“I don’t see how anyone could spend $2 million on the share of a private jet,” says Romney.
“Mitt, I don’t see how anyone could spend $4 million trying to beat Ted Kennedy,” says Wolpow.
That’s a really good point.
Part of what concerns me about all this is the old adage about if you only have a hammer, everything begins to look like a nail. Well, if you only have a scissors, everything begins to look like waste. New technology: waste. Jobs: waste. But political self-aggrandizement: worthy of extravagant investment. And how could we consider Romney’s quest anything less? He’s been running for president full-time for nearly seven years. But you? Austerity becomes you.
There’s a phenomenon in the hog industry where downed hogs—the ones who’ve fallen and they can’t get up—are allowed to be “assisted” on their way to the killing floor. Just a little case of heat exhaustion explain the slaughterers, though we suspect those hogs have been under a somewhat disgusting and crushing burden during their last days at the feed lot and in transit. That’s sort of how I see the companies like American Pad & Paper that Mitt and the gang took over. Once AmPad was larded with crushing debt they never stood a chance as they were set to be sold—or slaughtered. Thus, they were vaporized in the maw of “industry consolidation” or somesuch. The truth is, like those hogs, they never stood a chance. And I wonder, what would the federal government look like after a term or two of Mitt?