“No Such Thing As Good Luck?: For Mitt Romney, His Entire Life Has Been A String Of Good Luck
Now that we’re having a real debate about the fundamentals of capitalism and success, it’s worth considering another part of the now-infamous “You didn’t build that” speech President Obama recently gave. When he was accused of taking Obama’s words out of context, Mitt Romney’s defense was that “The context is worse than the quote.” As evidence, he cited not the actual context of “You didn’t build that” but what Obama said a paragraph before, about the role of fortune in success. And it’s that idea—that success has to do not only with hard work and talent but also with luck—that really got Mitt Romney steamed. Here’s the passage in question:
There are a lot of wealthy, successful Americans who agree with me — because they want to give something back. They know they didn’t — look, if you’ve been successful, you didn’t get there on your own. You didn’t get there on your own. I’m always struck by people who think, well, it must be because I was just so smart. There are a lot of smart people out there. It must be because I worked harder than everybody else. Let me tell you something — there are a whole bunch of hardworking people out there
You might think that this would be hard to argue with, but as David Frum observed, many successful people find the idea that luck played a part in their success to be deeply offensive. And it makes me wonder whether Mitt Romney himself believes that the fact that his father was a wealthy industrialist and governor had nothing to do with his financial success. Does he think that if he been born to a poor single mother in backwoods Appalachia, he would have grown up to be the same private equity titan he turned out to be?
I’m guessing he does, but it would be interesting to hear what he said if someone asked him, “Governor, what role do you think luck played in your success? Do you think you had more of a chance to succeed because of who your parents were?”
Don’t know about you, but I’m happy to admit that luck played a large part in whatever success I’ve had. I was fortunate in my parents; we weren’t rich, but they valued education highly, created an environment with lots of opportunities for learning, and moved us to a town with excellent public schools. Had I been born in more deprived circumstances, I’m quite sure I wouldn’t have had anything like the opportunities I did, and I seriously doubt I would have pulled myself up by my bootstraps unless some other piece of luck fell my way. Luck played some part in getting most of the jobs I had, even if it was just knowing someone who knew someone who had an opening. I work hard enough, but I’m not such a jerk that I don’t understand how lucky I am to have a career as a writer, which is absurdly cushy compared to the jobs of people who stand on an assembly line or run around a distribution center or change bedpans. In my youth I had just enough exposure to a series of not-particularly-pleasant jobs like waiting tables and working a cash register in a supermarket to make me never forget how absurdly lucky I am to make a living doing what I do.
Mitt Romney is right about one thing: it’s hard to start and maintain a business. And it’s particularly hard if, unlike someone like Mitt Romney, you can’t live off your stocks when you do it. So I understand why some business owners would get their backs up when Romney tells them that Barack Obama told them they didn’t actually build their business. I’d hope they’d take the time to figure out that Romney is actually lying to them about that, but what can you do. But what I struggle to understand is the rich guy who thinks that luck played absolutely no part in him getting where he is. Maybe I’m wrong, but I don’t hear that coming from a guy who built up a construction business from the ground up. People like that have usually had exposure to enough bad luck to know good luck when they see it. It’s only the people whose entire lives have been nothing but a string of good luck who so angrily assert that there’s no such thing. It’s the Wall Street tools who got six-figure jobs in their uncle’s firm fresh out of Wharton who insist so vehemently that everything they have is because of their own talents. Only if you think that could you genuinely believe that an increase in your income tax of a few points constitutes some kind of communist attack on success.
By: Paul Waldman, Contributing Editor, The American Prospect, July 30, 2012
“Mitt vs Stubborn Facts”: A Difficult Relationship For The Romney Campaign
John Adams once said, “facts are stubborn things.” These days, another Massachusetts politician has found that saying to ring especially true.
While it’s still unclear how Mitt Romney can be the CEO, chairman, president and sole shareholder of Bain Capital, a company that he claims no responsibility for, it’s become increasingly evident that candidate Romney simply doesn’t want to talk about the facts of his business record.
In an interview with CNN’s Piers Morgan, Romney suggested that to question his experiences is to “attack success.” If this is the case, and if we’re also not supposed to talk above a whisper about Mitt’s record as governor, including his signature accomplishment in health care reform, then which parts of his biography remain on the table?
Romney clearly prefers his largely undisclosed experiences in the private sector over his publicly poor record in Boston. At every turn, Romney and his campaign have attempted to steer the discussion toward business matters for just this reason.
But when the Washington Post took him up on it last month and published an article headlined “Romney’s Bain Capital invested in companies that moved jobs overseas,” the Romney campaign was caught flatfooted. The Post found that Bain Capital, the firm Romney spent much of his professional life building up, had invested in companies that had not only shipped jobs overseas — a practice of some concern to working- and middle-class Americans — but had pioneered the practice.
Romney’s campaign pushed back hard, claiming that the Post had its facts wrong. The campaign met with the Post’s editors and demanded a retraction, claiming that Romney had left Bain in 1999, supposedly before the outsourcing investment began. The Washington Post listened to the Romney side of the story but stood its ground.
Now we know why. The Boston Globe reported two weeks ago that Romney had signed official documents claiming to be the president and CEO of Bain Capital as late as 2002, when the company was actively building up firms that outsourced American jobs. He didn’t just say this casually at some dinner party; he swore it was the truth on Securities and Exchange Commission filings.
What did the Romney campaign do this time? It hit the “repeat” button and demanded a retraction from the Globe. Who are you going to believe, the campaign asked its hometown paper, me or your lying eyes? Once again, the investigative journalists stood by their reporting.
Since the Globe story, the hits have kept coming. The AP reported this week that Romney stayed in “regular contact” with Bain during his so-called absence, “personally signing or approving a series of corporate and legal documents through the spring of 2001.” Several sources are now saying that Romney made repeated trips to Boston to meet with Bain executives during this period, even though he recently told CBS’s Jan Crawford that he doesn’t “recall even coming back once to go to a Bain or a management meeting” during the period in question.
So despite what the Romney campaign claims, media interest in this story has nothing to do with attacking personal success in the private sector. It has nothing to do with avoiding the real issues of the campaign.
It has everything to do with attempting to get to the bottom of a situation in which what a candidate is saying seems to have come unglued from the stubborn facts.
Americans know that a level playing field empowers a successful economy. You want to talk about soaking the rich? Mitt Romney’s father, George Romney, paid an effective tax rate of nearly 37% in 1967. The elder Romney didn’t complain and released his tax returns to prove his compliance with the law of the land he wanted to lead. In 2010, Mitt Romney’s tax rate bobbed and weaved its way below 15% — and we know that only because the public had to pry his return (he has released only a full one) out of his clenched hands.
Even more fascinating than the fact that Romney’s father released 12 years’ worth when he ran for president in 1968 is the reason why. “One year could be a fluke,” the elder Romney said, “perhaps done for show.”
This country has a noble habit of withholding elected office from people who have trouble with the facts. Romney could end these discussions overnight by releasing his tax returns, as he has been called on to do by Republicans like Alabama Gov. Robert Bentley, former Mississippi Gov. Haley Barbour and Iowa Sen. Chuck Grassley.
Until he makes peace with the facts, Romney will be stuck at the intersection of what is both a character issue and a policy issue. If Romney won’t stand by his record at Bain, just like he won’t stand by his record as governor of Massachusetts, how exactly is the American public supposed to evaluate the candidate? And if he won’t disclose his own relationship with tax loopholes and offshore tax havens, leaving voters more questions than answers, how can the American people trust him to reform our tax code in a way that closes loopholes, eliminates free-riding and ensures that everyone is playing by the same rules?
Facts and the Romney campaign have a difficult relationship these days. But they do share one thing in common: They’re both stubborn.
By: Donna Brazile, CNN Contributor, CNN Opinion, July 27, 2012
“Generic Dubya”: Mitt Romney’s Innovative Economic Plan
When pressed for details on his economic plan, the former governor has only GOP boilerplate.
I’ll be honest: There are a few things about Mitt Romney that I find annoying. One of the biggest has to be that there is probably no sentence he has repeated more often in this campaign than “I know how the economy works,” but he never actually explains what he knows that nobody else does, or how that hard-won knowledge translates into a unique set of policy moves that only he could bring about and that would pull America from its economic doldrums.
There are really two sets of questions that absolutely must be asked of Romney in the area of economics, given the rationale he offers for his candidacy. The first is, “What specifically did you learn as a businessman that policymakers haven’t known up until now?” As far as I know, he has only been asked this question once, and the result wasn’t encouraging. (After repeating over and over that he “understands how the economy works,” Romney finally allowed that businesses spend money on energy, so if energy were cheaper, they’d have more money. Brilliant, I know.) The second question that Romney needs to be asked is, “What are you proposing to do, and how is that different than what we’ve done before?”
The natural way to ask this is the way Brian Williams asked it in an interview with Romney yesterday: “The major planks of your job plan, lower taxes, both corporate and marginal rates, and reduce regulation. Explain how that would be different from what George W. Bush tried to push through?” Republicans might say this is a “gotcha” question, since it brings up George W. Bush, whom today’s Republicans like to pretend was not actually president for eight years. But it’s a reasonable way to ask, since Bush’s presidency was pretty recent, and he did in fact implement the entire Republican economic agenda, with the exception of drastic cuts in the size of government, though that’s something Republicans are committed to in rhetoric only. So how did Romney respond?
Well, let me describe—actually, there are five things that I believe are necessary to get this economy going. One, take advantage of our energy resources, particularly natural gas, but also coal, oil, nuclear, renewables. That’s number one. A huge opportunity for us, and doing so is gonna bring manufacturing back, because low-cost, plentiful energy is key to manufacturing, in many industries.
Number two, trade. I want tre– to dramatically increase trade and particularly with—with Latin America. Number three, take action to get America on track to have a balanced budget. Now those three things, by the way, are things which we have not been doing over the last few years, which I think are essential to getting this economy going again.
Number four, we’ve got to show better training and education opportunities for our current re– workers and for coming workers. And then finally what I call restoring economic freedom. That means keep our taxes as low as possible, have regulations modern and up to date, get health care costs down. These things will restore economic freedom.
So my policies are very different than anything you’ve seen in the past. They’re really designed for an America which has some new resources, energy being one of them, trade with Latin America being another, and the need for a balanced budget now more urgent than ever before.
To review: The way Mitt Romney’s economic plan differs from what George W. Bush did is that Romney favors exploiting energy resources, free trade, having a good education system, balancing the budget (something every candidate in both parties says they’ll do, but only Bill Clinton actually did), tax cuts, and less regulation. In short, Romney’s program is exactly the same as what George W. Bush did. Yet Romney says, “My policies are very different than anything you’ve seen in the past.” Right.
It isn’t necessary that every presidential candidate come up with a set of policies that are absolutely new and unique. After all, politicians are largely creatures of their parties, and those parties have relatively consistent agendas, so no party nominee is going to offer an agenda that’s unlike anything we’ve seen before. But Romney is presenting a case for his candidacy that is an unusual synthesis of the personal and the policy. Other candidates have centered their candidacies on a personal argument—Bush was a “different kind of Republican” who would deliver us from the bitter partisanship of the 1990s, Obama was the embodiment of hope and change—but Romney’s two-fold claim is that the election is all about the practical problem of improving the economy and that because of who he is, but not because of what he wants to do, only he can solve that practical problem. When he’s forced to get specific, his solution to the practical problem is the standard Republican agenda.
It’s entirely possible that this argument, hollow though it is, could work. Polls seem to indicate that Romney has an advantage on which candidate voters believe would do a better job managing the economy, which is not the same as them thinking all we need to do is cut taxes for the wealthy and remove regulatory constraints on corporations. Indeed, the appropriate follow-up to the question Williams asked is, “George W. Bush did just about everything you’re proposing to do. If it didn’t work then, why is it going to work now?” But nobody has asked Romney that either, so the most advantageous thing for him to do is to keep repeating “I understand how the economy works” and hope he doesn’t have to answer too many questions about what he actually wants to do.
By: Paul Waldman, Contributing Editor, The American Prospect, July 26, 2012
“Vote Republican Or The Economy Gets It”: The GOP Threat Behind All The “Fiscal Cliff” Talk
Greg Sargent has a fine post today about how Scott Brown has picked up on the Romney campaign’s effort to spin a mendacious take on the “you didn’t build that” quote, making it a double lie by tying it back to Elizabeth Warren (whose actual words were being paraphrased by what the president actually said). Indeed, Greg puts his finger on the broader message that both Republicans are trying to send:
The whole ”didn’t build that” dust-up is important, because the larger falsehood on display here — that Obama demeans success — is absolutely central to the Republican case against Obama. The Republican argument — Romney’s argument — is partly that Obama’s active ill will towards business owners and entrepreneurs is helping stall the recovery, so you should replace him with a president who wants people to succeed.
What makes this “vote Republican or the economy gets it” tactic devilishly effective is that its major premise—Obama hates “job creators”—doesn’t have to be true to wreak political damage so long as its minor premise—if “job creators” think Obama hates them they’ll stop creating jobs—is credible. And so it all turns into what amounts to blackmail: people like Mitt Romney are not “confident” in Obama’s stewardship of the economy, and if they don’t get ther way in November, they’ll tank the economy. This is also the threat behind all the “fiscal cliff” talk: we’re being told the financial markets will panic if there’s any chance the Bush tax cuts on the wealthy will lapse or that Pentagon spending will be cut at the end of the year. Somehow or another, the prospect of a Republican victory that will lead to very deep federal spending cuts, reductions in consumer buying power, and the elimination of many thousands of public sector jobs isn’t said to be a problem.
Now this is a very, very old game, certainly as old as the threats issued by business leaders at the behest of Mark Hanna in 1896 that votes for William Jennings Bryan would lose employees their jobs, or the eternal threats of non-unionized companies that they’d rather close their doors than submit to the indignity of collective bargaining. In reality, companies stay in business and investors keep investing not because they have the elected officials they’d prefer, but because they are making money. With profits being at near-record levels (even with the apparent recent softening), I don’t think we are really in any danger of capitalists “going Galt” because their executives’ marginal tax rates went back up to where they were when they were also doing very well in the late 1990s, or because their vast moral worth is being underappreciated by Barack Obama or Elizabeth Warren.
Still, the more aggressively ideological business leaders won’t lose a dime by issuing threats, so they and their political allies will keep doing so, reinforcing the GOP’s many efforts to convince persuadable voters that somehow or other, their jobs or their nest eggs depend on a Republican victory in November.
BY: Ed Kilgore, Contributing Writer,Washington Monthly Political Animal, July 23, 2012
“The Man Without a Past”: Mitt Romney, A Barbarian At The Gate?
Mitt Romney has an identity problem. He is running for president by making promises about America’s future, but as a man who is largely without a past. Not only has Romney renounced many of his previous positions — on abortion, immigration, gun control, climate change, and the individual mandate he once championed as Massachusetts governor. He also refuses to divulge many details about what even he has said is his main qualification for the White House in a faltering economy: his successful career in “private equity” from 1984 to 1999 (or thereabouts).
What is it about the private equity world that Romney doesn’t appear eager to bring up? As I explain in an article in the current issue of National Journal, “Mystery Man,” Romney was basically what used to be known as a “barbarian at the gate.” The term “private equity” sounds respectable, but it is a euphemism for the old leveraged buyout deals we remember from the 1980s, the era of corporate raiders like T. Boone Pickens and Henry Kravis. After junk-bond king Michael Milken, who funded a lot of those takeovers, went to jail, the industry decided to rename itself in order to remove the taint.
This is Mitt Romney’s true world. As the founder of Bain Capital, Romney became a brilliant LBO buccaneer who specialized in buying up firms by taking on a lot of debt, using the target firm as collateral, and then trying to make the firm profitable — often by breaking it up or slashing jobs — to the point where Bain and its investors could load up the firm with even more debt, which Bain would then use to pay itself off. That would ensure a profit for Bain investors whether or not the companies themselves succeeded in the long run. Often, burdened by all that debt, these bought-out companies did not succeed, costing thousands of jobs as they were downsized, sold off and shuttered. Other times they did phenomenally well, as in the case of Sports Authority and Domino’s Pizza.
But job creation is irrelevant to Bain’s business model, which is all about paying back investors. Nor does the long-term fate of the companies that private-equity firms buy up matter crucially to Bain’s bottom line (though of course success is better). The only real risk for Bain is that these companies fail to make enough initial profit in order to permit Bain to pile on more debt and extract a payout, so that it can make back its investment quickly.
Though he started off dabbling in less profitable “venture capital,” Romney quickly saw the high-return, low-risk potential of LBOs in the mid-1980s and ultimately was involved in about 100 such deals, which made him a true Wall Street tycoon. He then maximized his take further by socking away his gains in offshore shelters from Bermuda to the Caymans and using capital gains tax breaks and loopholes to reduce the rate of his 2010 tax return (the only one he’s released) to 13.9 percent, a far lower rate than the one paid by middle-class Americans. Many of Wall Street’s big dealmakers do the same with their profits, employing whole teams of international tax accountants.
But none of these dealmakers has ever run for president. This is perhaps the main reason for Romney’s reticence: It’s not just that being honest about Bain’s real business pulls back the veil from the ugly heart of financial capitalism. It’s also that this may be the hardest year since 1932 for a Wall Street big-shot to make a bid for the White House: The former Masters of the Universe remain unpopular because of the historic recession they did so much to create. So it’s hardly a surprise that Romney won’t dwell on practices that his onetime GOP primary opponent, Texas Gov. Rick Perry, labeled “vulture” capitalism.
None of this is necessarily disqualifying for a presidential candidate; on the contrary. Americans have always admired business success, no matter what package it comes in. It is part of the nation’s lore going back to the rags-to-riches tales of Horatio Alger and F. Scott Fitzgerald, and the storied careers of Andrew Carnegie and J.P. Morgan. Romney is undoubtedly one of the most successful capitalists ever to run for president. Based on his record at Bain, as governor, and at the Olympics, there is little doubt that he is a numbers whiz who is handy with a budget, and America has serious budget problems. “At the end of the day, people are going to know Mitt Romney was a super-successful businessman, and they’re going to factor that in,” says Vin Weber, a senior Romney adviser. “And most people will find that attractive and not negative.”
Maybe so. But as the Obama attacks persist, even some in the Romney camp fret that they are watching a Democratic version of the attacks that permanently defined Michael Dukakis as weak in 1988 and “Swift-boated” an unresponsive John Kerry in 2004. “That worries me a little bit,” Weber admits.
The Obama attacks also may be resonating because they compound an image of aloofness, of detachment from the lives of ordinary Americans, which has dogged Romney for many years. He is hardly the first rich man to run for president, yet he lacks the populist touch of previous successful candidates. Franklin Delano Roosevelt also came from a wealthy patrician family, but by the time he ran for president as a polio victim who had suffered among the people in Warm Springs, Ga., FDR had reputation for transcending that background. So did John F. Kennedy, whose father’s vast but somewhat shady Wall Street fortune financed a rich-kid bid for Congress, the Senate, and then the presidency. But JFK’s charisma and war-hero reputation, and his ability to connect with people — for example, by famously telling a hushed crowd of mothers who had lost sons in World War II that “I think I know how you mothers feel, because my mother is a Gold Star mother too” — made him a popular figure.
Not so Romney. His record contains few such man-of-the-people moments (ironically, his best argument may be his successful health-care law in Massachusetts, another thing he doesn’t want to talk about). And his uncommon Mormon religion, about which he is also reticent, further contributes to the image of a Man Hard to Know. This is the same Romney who declared during the hard-knocking primaries that the $350,000 he earned in speaking fees wasn’t a lot of money, who said that his wife drives a “couple of Cadillacs,” who grinningly bet Rick Perry $10,000 on a whim, and who boasted that even wealthy Ted Kennedy had to “take a mortgage out” to beat him. And those are moments when Romney was trying to be one of the guys. What has become clear is that he is part of a world of super-elites who live in a universe apart from most Americans.
Romney may well make a very good president. But we should know who we’re getting.
BY: Michael Hirsh, The Atlantic, July 21, 2012
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