Thursday, January 12, 2012

Mitt's "Tough" Decisions

On my second cup of coffee this morning digesting my daily diet of political shows. Let me share a few instant observations.

First, the attacks on Romney's record at Bain are hurting him. If that weren't true, Nikki Haley would not be delivering a lecture on capitalism and why sometimes jobs are eliminated.

I am not saying that Gingrich and Perry are not also hurting themselves by adopting what some Republicans have called the language of Zuccotti Park. That may be true too. But there is no question that the Romney campaign finds itself on the defensive at a time when they should be doing victory laps.

Second, most of the self-appointed defenders of financial capitalism seem unaware of what private equity firms do. They also seem to operate on the belief that any questions about the amounts of money someone makes in a financial transaction is indicative of socialist tendencies.

The reality is that excessive markups and commissions are violations of securities rules and regulations. We have statutes against gouging and usury. Let me be clear, I am not suggesting that Bain did anything illegal. I am just pointing out that questioning how profits are generated is not an automatic attack on capitalism.

Finally, it is clear that the latest spin on Romney's job destruction record at Bain is that it is evidence that Mitt can make tough decisions. Jim DeMint said on Morning Joe that sometimes (I am paraphrasing) some jobs have to be eliminated in order to save companies and the problem in DC is that there are not enough people willing to make the necessary tough decisions to save the country.

Pretty clever spin. Unfortunately, for Romney some of the "tough" decisions at Bain were more along the lines of whether to extract $1 million or $4.5 million in management fees from a company they were driving into bankruptcy. Whether to send taxpayers a $20 million or $44 million bill for underfunding the pension fund of a company Bain purchased. Real "tough" decisions indeed! (insert sarcastic tone)