David Corn of Mother Jones strikes again.
Yes, there’s a new video of Mitt Romney and it confirms what we’ve always suspected about Bain Capital. Unlike many private equity firms and venture capitalism ventures, Bain existed for the sole purpose of extracting profits by “harvesting” companies they took over. This means Bain was never in the business of creating jobs, but rather of pumping companies for every cent for the Bain investors before too often bankrupting the targeted business.
Does America want to be harvested by greedy vultures dressed in fancy suits?
Watch here via Mother Jones:
TRANSCRIPT from Mother Jones:
Bain Capital is an investment partnership which was formed to invest in startup companies and ongoing companies, then to take an active hand in managing them and hopefully, five to eight years later, to harvest them at a significant profit…
The fund was formed on September 30th of last year. It’s been about 10 months then. It was formed with $37 million in invested cash. An additional $50 million or so of what I’ll call a call pool, which is money that we can call upon if the deals are large enough that they require more than a $2 or $3 million dollar initial investment.
Why in the world did Bain and Company get involved in this kind of a business? We’re not particularly noted for having years and years of experience in financing. Three reasons. We recognized that we had the potential to develop a significant and proprietary flow of business opportunities. Secondly, we had concepts and experience which would allow us to identify potential value and hidden value in a particular investment candidate. And third, we had the consulting resources and management skills and management resources to become actively involved in the companies we invested in to help them realize their potential value.
As Rmuse has written for PoliticusUSA, too often these companies that Bain took over to help “them realize their potential value” were driven into bankruptcy by greedy Bain payouts to Bain investors.
Romney’s record reveals that much of his wealth came from leveraging companies with crushing debt and using a team of trusted specialists who mastered the art of manipulating bankruptcies that left investors and creditors with little or nothing. After looking at some of the companies Bain Capital managed and eventually bankrupted, a pattern develops that begs the question; did Mitt Romney & Bain Capital own a bankruptcy ring consisting of Jack Bush, Barry Gold, Paul Traub, and Michael Glazer?
… besides KB Toys, his incestuous bankruptcy team also were involved in Jumbo Stores, Stage Stores, FAO Schwartz, and eToys bankruptcies that always worked for Bain’s benefit and left investors and creditors with nothing to show for their trouble.
So when Mitt Romney says “realize their potential” he means exactly what you think he means when he talks about the 47%. He means realize their potential to help the rich investors of Bain get richer, but also too often leaving not just the employees and business owners in the dust, but also the creditors and vendors.
Bain Capital is not the story of a private equity firm set up to help mom and pop businesses flourish. Remember when Cory Booker defended private equity? That’s because not all outlets run like Bain (and also because Booker gets money from Wall Street). Many of them do, but not all. There is money to be made in actually turning companies around, and Bain would do that if it was profitable for them. But their main goal was never to turn around a company.
The main goal of Bain Capital was not to create jobs or infuse a struggling business with cash flow to help it turn around. The main goal of Bain Capital was to make money by squeezing every dime out of the company it took over. This meant cutting jobs while paying the Bain investors every penny they could. This meant killing the cash flow of the company and driving it into debt sometimes, while still paying the investors at Bain.
So, not just jobs were killed. No. Think of all of the vendors who weren’t paid when the companies were bankrupted. Those are often mom and pop businesses, left to carry the result of Bain’s greed.
Romney wants you to see him as a businessman who can turn around this country as he turned around companies for Bain. But on this tape, as in the history of Bain, we see that after a few years, those companies were often “harvested” for profit.
America is not a struggling business that needs to be harvested for profit. America is not a business at all. In fact, the very premise of our government is that it is non-profit, and the reasons for this should be obvious. But if there are any doubts, one need only look at the disastrous results of privatization of previously non-profit government operations where too often we see rampant abuse of government resources with less accountability. Yes, government can be full of waste and there is fraud, but often that fraud comes from private businesses stealing from the taxpayers, like Florida Governor Rick Scott’s Medicare frauds.
If this election were to come down to trust, who would you trust more to look out for you- the man who sees every event as a potential to harvest profit for himself and his sponsors and who has said that he doesn’t see the job of President as having to worry about “those people”, or the man who ha already been in the White House for almost 4 years, who has a track record of fighting for the middle class and poor?