“A Service To The Nation”: Obama Has The Right And Duty To Highlight Romney’s Record
Has the Obama Campaign Gone Too Negative?
Your question presumes “negative campaigns” are a problem. Like everything else they can go too far, but negative campaigning began with the very first elections. In ancient Rome, Cicero railed against his opponents for incest with a sister, debauchery with actors, thuggery with gladiators, not to mention child molestation with boys so young they were “almost in their parents’ laps.” In our first presidential election, Thomas Jefferson’s opponents argued that if he were elected, “Murder, robbery, rape, adultery and incest will be openly taught and practiced…” In our more genteel times, such attacks would be far out of bounds.
Negative campaigning happens because it works. It works in part because negative information is useful. We naturally look for the negative. When an employer rummages through a pile of resumes, she is looking for the easy disqualification, the reason to discard a few candidates. Unlike their more pleasant, positive counterparts, negative ads tend to include at least one verifiable fact. While positive ads often feature a candidate, jacket slung over a shoulder, mouthing platitudes in the company of an adoring family, negative ads describe votes cast, positions taken, failed efforts, and values forsaken.
Our brains are wired to weigh this kind of information heavily. Decades of research in psychology demonstrates that negative information is processed more quickly and more deeply than positive information, providing a biological basis for negative campaigns. They conform to human nature.
So-called negative campaigning isn’t all bad—and sometimes it’s both fair and necessary. The natural state of an election involving an incumbent president is to be a referendum on that incumbent—an up or down vote on the individual occupying the Oval Office. That’s not only unfair to the president, its unhealthy for the country. Elections actually confront us with choices, choices between two different individuals with different histories, different philosophies, different values, and different platforms. Voters should think of the campaign as a choice.
Bringing former Gov. Mitt Romney’s faults to the fore helps the American people see this election as the choice it is. That’s both good for the president and good for the country. As long as the blows aren’t below the belt and focus on what former Governor Romney has done, what he believes, and what he will do, there is nothing at all untoward about the tack taken by the president’s campaign. In fact, it’s a service to the nation.
“Mitt Romney’s Entitlement Society”: Winning For Losing, Money That Flow’s To The Wealthy
Mitt Romney, who secured the number of delegates needed for the Republican nomination last week, said early on that this election is a choice between President Barack Obama’s “entitlement society” in which people are dependent on government benefits, and his “opportunity society” where business is free to flourish.
But if you take Romney’s own life as representing a governing philosophy, he has the dichotomy backward. Romney is the one who has taken advantage of government entitlements — the ones that flow to the wealthy. And his interest in opportunity lies with rich investors who exploit government rules, often to the detriment of Main Street. Romney’s use of the federal bankruptcy courts to extinguish debts owed to suppliers, shops and service providers is a perfect example — more on that later.
For starters, let’s tick off some of Romney’s favorite government entitlements:
• Special tax rules allow him to pay federal income taxes of just 15 percent on his millions in “carried interest” profits, capital gains and dividends. The rest of us pay a rate of up to 35 percent on income from work.
• Bain Capital, the private equity firm Romney founded and ran from 1984 to 1999, only succeeded due to a major tax loophole. Bain was able to deduct the interest on the massive loans taken out to finance the purchase of its takeover targets — loans secured with the companies’ own assets. In 2008, Germany put limits on this kind of tax shenanigans, but don’t expect anything that enlightened to happen here.
• Romney’s firm also enjoyed government largess in the form of job creation tax breaks. Just the year before Dade Behring, a Bain company, closed its operations in Puerto Rico in early 1998, with nearly 300 workers losing their jobs, the company received federal tax break of $3 million for promoting jobs there and a $4.1 million tax exemption from Puerto Rico.
But there is no big government entitlement as magical or beloved by Romney and Bain than the get-out-of-debt-free card bestowed by federal bankruptcy court.
Dade Behring went bankrupt, leaving Main Street creditors empty-handed, but not before Romney’s firm took $242 million out of it. In fact, of Bain’s 10 top business investments that made up 70 percent of the $2.5 billion Bain made for investors, four eventually went bankrupt, according to the Wall Street Journal.
That’s called winning for losing, a game perfected by top 1 percenters.
For a closer look at one destructive bankruptcy, read “Romney Economics: Cheat Main Street,” a column by Leo Gerard in the Huffington Post (http://tinyurl.com/dylorbl).
Gerard documents the way Bain left Main Street businesses licking their financial wounds as it legally absconded with millions in management fees, dividends and other distributions. His featured example is American Pad and Paper Co. (Ampad) that Bain bought from Mead Corp. in 1992. Bain remained the company’s largest single shareholder through 1999, and three Bain executives sat on its board. In 2000, the company filed for bankruptcy, leaving debts to suppliers of more than $180 million. Even so, Bain came out smelling like money. It had invested $5 million and took out more than $100 million.
Eleven years after Ampad filed for bankruptcy, as Gerard points out, the company’s nearly 1,300 unsecured creditors finally got a pittance of what was owed: Green Bay Packaging Inc. was owed $75,500 and received $137; Lakeway Container Inc. was owed $47,100 and received $89; American Coffee Break Service was owed $1,300 and was paid $2.56. The bankruptcy trustee’s final report lists page after page of Main Street businesses receiving less than a penny on the dollar. Had that $100 million flowed to Ampad’s suppliers rather than Romney and Bain investors, it would have covered more than half the debts.
Romney desperately wants to convince the public that Bain operated in the best interests of Main Street and that he didn’t get fabulously rich under government-rigged rules. But the man exemplifies the special tax breaks and legal shields from creditors that the wealthy see as their right.
That’s Romney’s “entitlement society.”
By: Robyn E. Blumner, Columnist, Tampa Bay Times, June 3, 2012
“The Wrong Résumé”: The Myth Of The Businessman President – A Prelude To Disaster
Lost in the exhaust of mendacity left in Las Vegas this week, after Donald Trump brought his birther fantasies to town on behalf of Mitt Romney, was a curious statement by the man who has now cinched the Republican nomination for president.
On Tuesday, the same day Trump proved yet again that money and truth, like money and taste, are seldom twined, Romney talked about amending the Constitution to require the president to have business experience. He spoke approvingly of a notion from a store owner who wanted to make anyone who does not have at least three years of business background ineligible to lead the country.
“He said, ‘I’d like to have a provision in the Constitution that in addition to the age of the president and the citizenship of the president and the birth place of the president being set by the Constitution, I’d like it also to say that the president has to spend at least three years working in business before he could become president of the United States,’” said Romney, cheerfully summarizing this rewrite of the founders’ governing blueprint.
Well, there goes Teddy Roosevelt, the writer, rancher and police commissioner, not to mention his distant cousin Franklin Roosevelt, the assistant naval secretary and politician, or Dwight Eisenhower, the career soldier. Ike’s résumé, which includes defeating the world’s most concentrated form of evil in Nazi Germany, would not be enough to qualify him for the presidency.
Romney has made business experience the main reason to elect him. Without his business past or his projections of business future, there is no there there. But history shows that time in the money trade is more often than not a prelude to a disastrous presidency. The less experience in business, the better the president.
In a scholarly ranking of great presidents, a 2009 survey conducted by C-Span,6 of the 10 best leaders lacked sufficient business experience to be president by Romney’s rumination. This list includes Ronald Reagan, the actor, union activist and corporate spokesman, and John F. Kennedy, the naval officer, writer and politician. There is one failed businessman on the list of great presidents, the haberdasher Harry S. Truman.
By contrast, two 20th century businessmen — George W. Bush, whose sweetheart deal with the Texas Rangers made him a multimillionaire, and Herbert Hoover, who came by his mining fortune honestly — were ranked among the worst presidents ever by the same historians. Bush left the country in a sea of debt and an economic crisis rivaled only by the one that engulfed Hoover.
Both George W. Bush and Romney are Harvard Business School graduates, further padding their business cred. Once they started governing, both men failed to improve the economic lives of those under them.
At Bain Capital, Romney as C.E.O. practiced a very Darwinian form of capitalism for 14 years; he points to his time there as a model for how he would turn around the American economy. But it’s clear that enriching a handful of shareholders often has very little to do with job creation. The point of private equity, after all, is to make deals that turn investments into profits — nothing more. In that realm, Romney has succeeded.
Once he moved from running Bain to running the Bay State, Romney was a failure at job creation. His state ranked 47th. Job growth nationwide, even under the sluggish economy of George W. Bush, was five times higher than it was in the Massachusetts run by Romney from 2003 to 2007. This was reflected in his approval ratings — 34 percent in the last full year of his term, making him one of the most unpopular governors in the country, ranked 48 out of 50.
The biggest job creator of modern times, Bill Clinton, wouldn’t know a spreadsheet from a cooked derivative. His business experience was nil, but he had governing smarts, and his instincts were usually right. Under Clinton’s watch, the United States added 23 million new jobs — this after he raised “job-killing” taxes on the rich.
Romney never mentions Clinton’s formula for prosperity, or that of Franklin Roosevelt, the other business-challenged president who took the American economy to new highs. Roosevelt had been through a traumatic life experience, the diagnosis of polio, that made him a man of resolve, with empathy for the average person.
“If you spent two years in bed trying to wiggle your toes, after that anything would seem easy,” said Roosevelt. When he ran for president in 1932, his theme was “the forgotten man.”
Romney has shown a strange tendency to fetishize wealth, from his belief that “corporations are people” to his boasting of how many Cadillacs his wife drives. His European role model would have to be Silvio Berlusconi, Italy’s richest man. A media tycoon, the Rupert Murdoch of his country, Berlusconi was laughably bad as a three-time prime minister.
The verdict is still out on Barack Obama, the community organizer, lawyer and writer. Because he got hit with the Bush hangover, his overall job numbers show a net loss of about 850,000, from January 2009 to the present. But if you start a year into his presidency, Obama has added almost four million jobs.
We aren’t electing a C.E.O. to occupy the White House. We’re looking for good judgment, broad life experience, flashes of wisdom. Still, for those who insist on making business the bottom line in who they pick, the past is indeed predictive.
By: Timothy Egan, The New York Times, May 31, 2012
“One Is A No-Risk Racket”: Why The Bain-Solyndra Comparison Is Terrible Strategy
Is asking voters to compare Romney’s vulture capitalism to Solyndra a good idea? The Romney campaign and its cohorts seem to think so. Within the past few days, American Crossroads, Karl Rove’s super PAC, released an ad that counters Obama’s attacks on Bain by highlighting Solyndra, a bankrupt solar panel company that had been given a government-backed loan guarantee, as well as the auto industry bailout. George Will made the Bain-Solyndra comparison on This Week; Paul Ryan did the same on Fox News Sunday; Michael Barone piled on in National Review Online.
The underlying argument is that the White House has been making the same risky bets as a private equity firm, bets that produced their own failures. (The grim-voiced narrator of the Crossroads ad, which is captioned, “President Obama is playing Wall Street games with our money,” asks, “Obama’s attacking private equity. But what’s his record on public equity investing?”)
It’s not the smartest response in the world. First off, Romney allies typically explain away Bain’s failures as just the way capitalism works—sometimes, bad companies are swallowed by the market. Solyndra, whose solar technology was priced out of the market by cheaper Chinese solar panels, is a pretty classic example of this, and by citing its Adam Smithian demise in response to attacks on Bain, Romney allies have diminished their ability to dismiss Bain’s loser companies as just the natural cycle of capitalism.
But the larger risk of this approach is that comparing any of Bain’s failures to Solyndra asks voters to examine private equity alongside public stimulus. The former is a game in which a tiny group of stakeholders set out to create as much value as possible for themselves: buying companies, often loading them up with debt they can’t bear, and extracting exorbitant fees for themselves before they reintroduce the company to the public and it either fails or succeeds. It’s essentially a no-risk racket, one Timothy Noah describes in fuller detail here.
Then there’s government stimulus, which is aimed at benefitting the public, and which the Obama administration has distributed with considerable success. Take the Department of Energy loan guarantee program through which the administration backed Solyndra. That program has been hugely effective for shoring up projects that the private market underinvested in. A recent, independent audit (pdf) by the former national finance chairman for John McCain found that it was due to come in about $2 billion under budget, and had subsidized mainly low-risk, critical electricity projects. The American Crossroads ad goes a step further and offers, as a comparison with Bain Capital’s failures, the government’s auto bailout, which an independent group found saved 1.45 million jobs, when no private equity dollars could be found to do the same.
On balance, the White House seems to be playing Wall Street games—if that’s what you want to call massive investment in underfunded public infrastructure—pretty decently, and in a manner that produces more value for the public than private equity firms. Bain and Solyndra are really nothing alike. And by insisting that they are, Romney boosters have given Obama’s campaign an opening to brag about what American Crossroads is calling Obama’s public equity presidency—and all its successes.
BY: Molly Redden, The New Republic, May 30, 2012
“Pin The Tail On The Donkey”: Mitt Romney Should Put Up Or Shut Up On Syria
It’s time for Mitt Romney to put up or shut up.
It’s irresponsible for Romney to criticize President Obama for not being aggressive enough with Syria and then fail to tell Americans how he would handle the crisis if he became president.
It’s time for Americans to pin the tail on Romney and make him accountable for his bellicose statements.
Romney is all hat and no cattle on national security problems. The last time we elected a governor without foreign policy experience, George W. Bush lied about weapons of mass destruction in Iraq to lead us into a tragic war that cost Americans dearly.
Romney has only two things on his thin foreign policy resume. He has millions of dollars stashed in bank accounts in the Cayman Islands and Switzerland. And he sent American jobs overseas while he ran Bain Capital.
Romney’s demonstrated that he was clueless when the former governor and former liberal identified Russia as our number one geopolitical enemy. The party boys in China must have had a hearty laugh when they heard that. My guess is they chuckled in Moscow, too. The commissars in the Kremlin know better than anyone that Russia has as much control over international politics as Charlie Sheen has over his temper.
Romney is clearly out of touch with Americans on defense spending. Thanks to President Obama, we are out of Iraq and close to an exit in Afghanistan. But the former moderate and current conservative GOP presidential candidate wants to increase defense spending. Americans are tired of spending hundreds of billions of dollars on wasted wars and overpriced weapons systems. Defense contractors love Romney as much as bankers, billionaires, and oil company executives do. The military industrial complex is alive and well in Romneyworld.
National surveys indicate that Americans give Barack Obama good grades as commander in chief of the armed forces. Americans credit the president for his handling of national security problems because he has an impressive record.
Barack Obama was able to do something in two years (kill Osama bin Laden) that President Bush couldn’t get done in eight. The former president sacrificed the lives of more than 4,500 brave young Americans and spent hundreds of billions of dollars to depose Saddam Hussein.
The current commander in chief built an international coalition which drove Muammar Qadhafi out of power without the loss of a single American life. The would-be president might want to think about the current president’s success with Libya before he gets the United States into another drawn out and costly war.
The United States is playing high stakes poker in the world and Mitt Romney would show up at the game without cards and without a clue.
By: Brad Bannon, U.S. News and World Report, May 31, 2012
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