“Betraying His Calling”: Romney Denies What He Knows About The Private Sector
Mitt Romney is betraying his calling.
He brings to the presidential race a record of accomplishment to which few White House contenders can lay claim: W. Mitt Romney knows how to make money.
Some may argue that a money-making ability alone is no qualification to be president. I agree that having a high net worth is insufficient reason to be declared presidential timber.
But attaining a personal fortune of as much as $250 million, as Romney has done — and not through inheritance or grand theft — is a testament to creative abilities, a strong work ethic, a focused mind and keen understanding of the economic environment.
Romney, however, is blowing it by seeking to appeal to the average voter by selling himself as something he’s not. He also is running away from the opportunity to show voters that he, above all other candidates, knows how Americans can reap a better return on the investments they are making of time, energy and talent in our country.
For the record, and as regular readers of this column know, I regard the political and moral priorities of the current White House occupant to be more in tune with my own. That said, Romney, by reason of experience, has a legitimate claim on the presidency.
A year ago, I said on the TV program “Inside Washington” that Romney understands how the economy works and that he should use the campaign to explain the private sector’s critical role. That point didn’t go down well with some of my liberal friends. Maybe it’s because I was wearing my banker’s hat at the time. Ten years as a commercial banker and bank director were more than enough time to convince me that a thriving business sector is key to economic growth and expanding opportunity. Romney, I believed last year, was well suited to make that case.
Instead, he has made a mess of it, misrepresenting his history and shying away from the truth, apparently out of fear that by sticking up for the country’s privately owned enterprises he will be portrayed as a heartless, money-grubbing capitalist and scourge of the poor. Of course, in this political climate, that might happen anyway. Still, there’s no reason to dissemble.
That’s the only way to describe Romney’s suggestion that job creation was the motivating force behind his work in the private sector. Beyond the question of whether Romney created 100,000 jobs — as he has claimed — is his implicit buy-in to the argument that the private sector’s purpose is to produce jobs.
Romney knows better, even if his critics don’t. The private sector operates to make profits, not jobs.
True, a majority of Americans work in the private sector. But General Motors, Giant Food, the TV networks and others don’t exist in order to employ Americans.
General Motors sells cars, Giant sells food and the networks sell entertainment to make a profit for their owners and investors.
Without question, a payroll is a necessary ingredient in building and selling vehicles, groceries and entertainment.
But owners, regardless of industries, are obligated to control costs. The fewer workers they employ, the better.
Romney portraying himself as an entrepreneur who altruistically created employment opportunities is not only incorrect but also conveys a false picture of free enterprise. That, in turn, skews public understanding of what the private sector can and can’t do; creating a more equitable and just society is one of the things businesses don’t set out to do. Romney seems ashamed of touting financial performance as an essential factor in economic growth, choosing instead to come across as a one-man hiring hall.
The pander is apparent in other ways. Take the Obama campaign’s charge that the private equity firm co-founded by Romney, Bain Capital, “invested in companies that moved jobs overseas.” The Romney camp responds by touting the former governor’s “record of job creation in the private sector.”
What clumsiness, if not cowardice.
There is nothing wrong with a company legally outsourcing jobs domestically or even sending jobs offshore if the effort allows the company to reduce its costs and operate more economically.
In this globalized economy, America must adjust to competitive forces. Certainly there are costs and downsides that come with outsourcing and offshoring jobs. That is not at issue. Change is constant. Workforce adjustments must be made. Government has a role to play. But adapting to competition at home and abroad is mandatory if we are to survive economically.
Romney, more than most, knows better, and he won’t touch this reality.
He betrays his calling because he’s willing to say — and be — all things to become president.
By: Colbert I. King, Opinion Writer, The Washington Post, July 6, 2012
“Shady Opportunism”: The Political Risks Of Mitt Romney’s Financial Skills
You can conduct byzantine transactions through opaque investment accounts and private corporations in offshore tax havens such as Bermuda and the Cayman Islands. Or you can credibly run for president at a time of great economic distress.
I don’t think you can do both.
Let me be clear that I have nothing against wealth. In fact, I have nothing against great wealth, which is how I would classify Mitt Romney’s estimated $250 million fortune. We can argue about the social utility of private- equity firms such as Bain Capital, but Romney isn’t responsible for distorting the system so that financiers are grossly overpaid. He just took advantage of the situation.
Increasingly, however, I have to wonder whether the achievement Romney touts as his biggest asset in running for president — his business success — might be seen by many voters as a liability.
The question isn’t whether people can relate to a candidate who has tons of money. It’s whether they will connect with a man who didn’t make his money the old-fashioned way — by building a better widget — but by sending capital hither and yon via clicks of a computer mouse to take advantage of arcane opportunities most people never even know about.
Most Americans, for example, do not have an individual retirement account valued at between $20 million and $101 million, as Romney stated last year in a financial disclosure report.
When Romney was running Bain and building up his IRA, the maximum annual contribution permitted by the tax code was $2,000. So how did Romney’s IRA get so huge? He won’t say. It’s possible that he rolled over some money that was originally in a 401(k) retirement plan of the kind offered by many employers. But annual 401(k) contributions were then capped at $30,000, including an employer match — in Romney’s world, chump change.
Analysts surmise that Romney may have placed his interests in various Bain investment partnerships in the IRA, taking advantage of Internal Revenue Service rules that allow these interests to be undervalued for IRA purposes. In some cases they can even be valued at zero, since partnership interests represent future income, not present income, and . . .
Okay, I know I’m losing you here — but you get the point. Individual retirement accounts were created as a way for middle-class Americans to save some tax-deferred money for their senior years. It isn’t clear exactly what Romney is using his gargantuan IRA for, but it’s certainly not what Congress intended.
Then there’s the question of a Bermuda-based company that Romney and his wife, Ann, own, Sankaty High Yield Asset Investors Ltd. According to the Associated Press, the company has been part of Romney’s portfolio for nearly 15 years, but it was not mentioned in any state or federal disclosure reports. It surfaced in Romney’s 2010 tax returns, which he reluctantly released earlier this year.
According to those returns, Sankaty is little more than an empty shell at the moment. But the AP reports that the company “served as Romney’s partnership stake” in a larger group of Sankaty-named funds that Bain once used to manage more than $100 million in investments. (Sankaty, by the way, is the name of a lighthouse on Nantucket.) Channeling private-equity and hedge-fund investments through offshore firms in places such as Bermuda and the Caymans can allow investors to avoid a tax on what is known as “unrelated business income.”
Romney’s campaign says that he pays every penny he is required to pay in taxes — although his income is taxed at about 15 percent, a lower rate than most middle-class Americans pay. Hey, I understand; if I could get away with paying less in taxes, I’d do it, too. And I suppose that if God didn’t want us to have offshore pass-through accounts in sun-drenched tax havens, he wouldn’t have invented them.
But one of the sources of anger and anxiety in this country — on the left and the right — is the sense that there are two sets of rules, one for the rich and powerful and one for everybody else. I don’t think voters want a “regular guy” as president; they want someone who is exceptional. But there is a point at which opportunism begins to shade into rapacity.
In making and managing his money, Romney appears to take every possible, conceivable, imaginable inch that the law arguably allows. That’s good finance. But I doubt it’s good politics.
By: Eugene Robinson, Opinion Writer, The Washington Post, July 5, 2012
“Living By Biography”: Mitt Romney Blistered By Conservative Wall Street Journal Editorial Board
This Wall Street Journal editorial is getting a lot of attention this morning for its scathing criticism of the Romney campaign’s equivocations over whether Obamacare’s individual mandate is or isn’t a tax. Yesterday Romney declared that, yes, it is a tax after all — contradicting his campaign’s earlier contention that it wasn’t — and the editorial blasts Romney for squandering a key issue against Obama.
But let’s face it: The skirmishing over whether the mandate is or isn’t a tax probably won’t have much of an impact on the election’s outcome.
That’s why the real news in the Journal editorial — the stuff that should drive the discussion today — is its scalding attack on Romney’s lack of specificity on multiple issues:
The Romney campaign thinks it can play it safe and coast to the White House by saying the economy stinks and it’s Mr. Obama’s fault. We’re on its email list and the main daily message from the campaign is that “Obama isn’t working.” Thanks, guys, but Americans already know that. What they want to hear from the challenger is some understanding of why the President’s policies aren’t working and how Mr. Romney’s policies will do better.
The Journal notes the Obama campaign’s attacks on Romney’s Bain years and offshore accounts, and adds:
All of these attacks were predictable, in particular because they go to the heart of Mr. Romney’s main campaign theme — that he can create jobs as President because he is a successful businessman and manager. But candidates who live by biography typically lose by it. See President John Kerry.
The biography that voters care about is their own, and they want to know how a candidate is going to improve their future. That means offering a larger economic narrative and vision than Mr. Romney has so far provided. It means pointing out the differences with specificity on higher taxes, government-run health care, punitive regulation, and the waste of politically-driven government spending.
The GOP-aligned Journal editoral board is implicitly agreeing that one of the leading critiques of Romney —one being made by the Obama campaign and Dems, but also by more and more media commentators — is entirely legitimate: That he’s refusing to detail his policies with any specificity to speak of on issue after issue.
This goes right to the heart of the central dynamic of this race: The Romney campaign’s gamble that he can edge his way to victory by making this camapign all about Obama, and that along the way, voters won’t notice that he isn’t meaningfully telling us what he would do if elected president. The Journal is calling this out as a non-starter. Does this represent broader GOP establishment opinion? It’s more important than all the short-term skirmishing over whether the mandate is a tax or not.
By: Greg Sargent, The Plum Line, The Washington Post, July 5, 2012
“Winking With A Blind Eye”: Where Are The Pro-Life Reactions To The Romney-Stericycle Story?
Yesterday, David Corn reported in Mother Jones that Mitt Romney may have played an active role Bain Capital’s $75 million investment in Stericycle, a company that disposes of medical waste from abortion clinics. According to Corn, Bain had previously claimed that Romney left the firm in February 1999 and that Romney probably had nothing to do with the deal.
Since this could potentially lose Romney some enthusiasm among social conservatives, I initially thought I would write a post about reactions to the story in the pro-life blogosphere.
Except… I couldn’t find any. Guys, I looked, but as of Tuesday afternoon, here’s where it stands:
Lila Rose’s Twitter feed? No mention as of this writing.
National Right to Life? Top headline as of July 3, 3:57 central time was “Supreme Court Decision Means Americans Must Elect Mitt Romney and a Pro-Life Congress Committed to Repealing ObamaCare.”
Susan B. Anthony List? Its president, Marjorie Dannenfelser, wrote a column for National Review Online yesterday titled “Pro-Lifers Must Unite Behind Romney.” (The discussion in the comments thread did make its way around to the Stericycle story, with folks chiming in both to support and criticize Romney.)
Americans United for Life? Again, as of 4 p.m. central, their online media center made no mention of it.
LifeSiteNews, which previously reported on a Romney fundraiser at the home of a pharmaceutical executive whose company makes the morning after pill, and which published a piece in January calling Stericycle a “medical waste giant allied with the abortion industry” didn’t turn up anything when I did a search for “Romney” and “Stericycle,” and the story wasn’t in their top headlines.
Jill Stanek? Again, no mention in the top headlines and a site search turned up nothing.
World Magazine, which is currently taking a critical stance toward the National Association of Evangelicals over the latter’s acceptance of a grant from the National Campaign to Prevent Teen and Unplanned Pregnancy? Again, my site search turned up nothing.
It could be that nobody’s gotten around to writing about it yet, I guess. Or, it could be that the pro-life blogosphere isn’t thrilled to learn about Romney’s possible role in the Stericycle investment; but, particularly on the heels of the Supreme Court decision, cares most about defeating Obama. In any case, the question will be whether it has any effect on voter enthusiasm. If no likely Romney supporters hear about it, I rather imagine it won’t.
By: Sarah Morice-Brubaker, Religion Dispatches, July 3, 2012
“Behind Closed Doors”: In Quiet Rooms, Where All The Romney Money Is Hidden
The incredible new Vanity Fair piece on Romney’s secretive off shore tax accounts and business practices at Bain immediately made me think of one of my favorite video clips of 2012, this one where Romney is talking about how issues related to the concentration of wealth should only be discussed in “quiet rooms”: http://youtu.be/ismksjp10q0
Mitt Romney undeniably likes his secrets, especially when it comes to money, and I have to admit that the revelations in Vanity Fairgave me a different take on the “quiet rooms” quote. I had always assumed it was just Mitt being Mitt, doing his classic Thurston Howell III imitation, another in a long line of Mitticisms (I like being able to fire people, I know a couple of Nascar team owners, did I tell you the funny story about how my dad laid off a bunch of people, etc.) reminding us how cluelessly out of touch Mitt was. It was also the ultimate in big money Republicanism: we don’t talk about these issues in public because we don’t want people to get mad and start a class war. But now it occurs to me what Mitt was really trying to guard in his quiet rooms: all the millions he has secretly stashed away.
What Mitt, with his offshore accounts and his secretive business practices and his endorsement of the Ryan budget which gives even more advantages to Wall Street tycoons like himself, is trying to preserve is the ability to play by a different set of rules than the rest of us. He wants a world where the wealthy have all these advantages and loopholes and secret deals and lower tax rates, precisely because that was his entire business model at Bain Capital. He wants a world where he doesn’t have to pay taxes on his accounts in Bermuda and the Caymans and Luxembourg and Switzerland. He wants a world where he can recruit any sleazebag overseas investor to invest in Bain. As Alex Seitz-Wald at Salon.com puts it: “This pattern of elusiveness is hardly confined to Romney’s finances, but rather defines his public life.”
Mitt’s entire career is defined by the secrets he has, and the fact that he didn’t have to play by the same rules as everyone else except for a few other well-connected Wall Street guys. The way Mitt made his money is exactly the kind of thing we should be talking about in this presidential campaign — and not only because it relates directly to Romney’s character, experience, and values. We should be talking about this because we should be debating as a country whether we want a country whose economic system is structured primarily to benefit a small number of wealthy, well-connected insiders operating behind closed doors, manipulating the tax code and financial markets to become more and more wealthy; or whether we want a country where businesses make money the old-fashioned way, by manufacturing and selling quality products, and playing by the same rules everyone else has to play by. By and large, with only occasional exceptions where Bain actually created real new jobs, the way Romney became wealthy was to make other people poorer — manipulating the financial markets and tax code, off-shoring jobs, cutting wages and benefits, laying off people, driving companies into bankruptcy while still getting huge fees from them. He also ripped off the rest of us taxpayers through the outrageous carried interest loophole, through loading up companies with debt and then writing it off, and through taking advantage of the taxpayer-backed Pension Benefit Guarantee Corporation’s obligation to pay off pensions when Bain’s companies went bankrupt. I guess it is not surprising that having made most of his money that way, he decided to keep so much of that money invested in secret overseas accounts.
No wonder Mitt Romney wants to keep this discussion confined strictly to “quiet rooms”. I would too if I had stashed so many of the millions I made from off-shoring jobs and all these other revolting business practices into secret off-shore accounts. But it is time for America to have this discussion — and not just in quiet rooms.
By: Mike Lux, The Huffington Post, July 3, 2012
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