The 99 percent: Gingrich, Perry rip Romney for Bain work

posted at 7:30 pm on January 9, 2012 by Allahpundit

Go look at the headline at National Journal. It has, it seems, come to this.

Card-carrying Romney critic Philip Klein, who’s spent years writing posts dumping on RomneyCare, can’t believe he’s being forced to defend you-know-who:

It’s nothing short of disgraceful behavior from Newt Gingrich, Jon Huntsman and Texas Gov. Rick Perry…

Romney’s rivals are engaging in the type of Marxist rhetoric that we’re used to hearing from Occupy Wall Street protesters, promoting an imaginary view of capitalism that’s exists only in Hollywood.

In reality, capitalism is the most moral economic system ever conceived of, because it’s the only one that’s consistent with personal freedom. Investors such as Romney pump money into businesses, and often have to cut jobs in an attempt to make them more efficient and profitable. And sometimes they fail despite their best efforts. But by cutting their losses, they have more money to invest in other businesses, and hopefully the gains outweigh the losses. In Romney’s case, he was tremendously successful overall, helping to grow businesses such as Domino’s and Staples that now employ tens of thousands of workers. In the process, he produced huge returns for his investors, who in turn had more money to invest elsewhere. However tragic the displacement of some workers was, on a net basis, companies like Bain help fuel economic growth. And there’s also no reason to believe that jobs that were lost – in steel investments, for instance – would have survived anyway. None of his rivals are accusing Romney of doing anything illegal or fraudulent in his business dealings, so it’s purely an attack on capitalism. It’s sad to see them go this route.

The money quote from Gingrich: “If somebody comes in, takes all the money out of your company and then leaves you bankrupt while they go off with millions, that’s not traditional capitalism.” Is that what Bain did — took all the money out of a company and then left it to die? According to the Journal, just 22 percent of the businesses acquired by Bain during Romney’s tenure ended up filing for bankruptcy afterwards. Another eight percent failed, but failed so badly that Bain lost its entire investment. And yet, if you believe Perry, the reason any of these businesses were shut down “was so that Bain Capital could profit and he could get richer.” Question for him and Gingrich: What rate of success in turning around acquisitions would exempt a private equity firm from charges of “looting,” as Newt puts it? 90 percent? 99? A full 100?

More from Avik Roy, another RomneyCare critic, who describes this as “Romney Derangement Syndrome”:

Frequently, these turnarounds initially involve layoffs — when they work, the layoffs act as a kind of pruning that allows a tree to grow again. When the turnarounds fail, however, the layoffs don’t work, and the company goes bankrupt. More often than not, these bankruptcies would have happened anyway: In the case of Bain’s investments in the steel industry, for example, cheap steel imports from abroad made it difficult for most American firms to survive…

#page#In some cases Bain may have made mistakes in its turnaround efforts, or misjudged an original business opportunity. That’s, again, what happens in the private sector. Success is not guaranteed. On the other hand, it’s fair to say that private-equity firms such as Bain Capital were responsible for many of the productivity gains, and the retreat of sclerotic labor unions, that the American economy generated in the 1990s. Rest assured that Bain would have not generated those spectacular returns for its investors, nor attracted those investors in the first place, if the majority of its investments failed…

It’s been discouraging to read that many conservatives see Romney’s record at Bain Capital as a liability. For the truth is the opposite: Romney is a candidate uniquely suited to defending the role of free enterprise in the American economy. When liberal politicians and journalists argue that layoffs are cruel, and that capitalism is unfair, Mitt Romney can speak to how dealing frontally with a business’s problems can lead to better and more numerous jobs over the long term. He can speak not merely in abstract philosophical terms, but using the real-world examples from his successes and his failures.

Go look at the table James Pethokoukis posted tracking “creative destruction” of jobs over the 20th century. The one fair point Gingrich and Perry supporters have in defending their guys is that Romney seemed to get off awfully easy back in September when he started tearing Perry down over his Social Security rhetoric. That attack is as offensive as this one, really: At a moment when conservatives are desperate for the country to think boldly about entitlement reform, there was good ol’ Mitt hammering Perry for being too bold. Could be that the Romney critics are right and that Mitt simply gets a pass for his brass-knuckles attacks because he’s — allegedly — the most electable candidate, but I think there’s more to it. Pandering to Republicans on entitlements is semi-accepted on the right because (a) like it or not, a lot of self-described conservative voters are fans of Social Security and Medicare and (b) the GOP itself used Mediscare arguments to great effect in the 2010 midterm elections in campaigning against ObamaCare. The attacks on Romney’s “creative destruction” in the private sector are unusual for a Republican campaign, though, and sit badly after months of screeching from OWSers about “the one percent.” (The boss emeritus, in fact, describes Gingrich and Perry as having “gone Occupier.”) If the right stands for anything, it’s capitalism — even more so than entitlement reform, strong defense, or “values.” Quoth the Club for Growth, “Newt Gingrich’s attacks on Mitt Romney’s record at Bain Capital are disgusting… Because of the efforts of Bain Capital, major companies like Staples, Domino’s Pizza, and the Sports Authority now employ thousands of people and have created billions in wealth in the private economy. Attacking Governor Romney for participating in free-market capitalism is just beyond the pale for any purported ‘Reagan Conservative.'”

Fairly or not, I think Gingrich and Perry are also paying a price today because their timing stinks of desperation. If Romney’s buyout record troubled them, they should have clubbed him with it from the beginning. Turning to it in the eleventh hour, after he’s won Iowa and is on the brink of putting them on ice in New Hampshire, makes it look like something they’ve resorted to not because they believe it but because it might work. And yeah, I know — politics ain’t beanbag, but if you’re going to hit a guy hard, can you at least not betray everything you supposedly believe about free markets in doing so? If Newt really does believe what he’s saying, why did he take it back after he attacked Romney on Bain the first time? Exit quotation from Rick Santorum, when asked to criticize Romney on Bain: “I’m not making it a liability. I believe in the private sector.”

Update: Here’s the best question of all: If you want to hit Romney for what happened at Bain, why not focus on this?

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And that’s what Perry did, and our guy, Newt, piled on – and he needs to be called out for it.

blink on January 10, 2012 at 11:47 AM

How dare they interfere with the perogatives of the Democrats, right?

kenny on January 10, 2012 at 11:54 AM

blink on January 10, 2012 at 11:47 AM

Do you really know that the public is being mislead about Bain? I don’t know enough to say and this movie that everyone is so wound up about hasn’t even been released. Gov. Romney needs to tell the public about his tenure at Bain and I still fail to see why it matters who brought it up. Obviously it does to you so just don’t vote for Gingrich or Perry. Complaining does nothing.

It would have been possible to combat Obama’s dirty lies about Bain Capital in a general election.

Please, stop, Romney has faced the line of attack numerous times, as recently as 2008, if he can’t answer it now, he never will.

Cindy Munford on January 10, 2012 at 12:00 PM

How dare they give credibility to disgustingly misleading marxists attacks.

blink on January 10, 2012 at 12:16 PM

Do you know how ludicrous it is to consider Gringrich and Perry spokesmen for Marx?

kenny on January 10, 2012 at 12:22 PM

Misleading. You keep using that word. I’m not sure you know what it means.

Mind to explain what exactly has been so “misleading” about Romney/Bain?

Saying that Newt got 1.6 million from Freddie Mac is misleading.

Since only 30k went to him peronally, the rest went to a consulting firm.

But saying that Romney shut down companies and fired people to generate huge profits for Bain?

Misleading? No. That is exactly what he did. So how are people being misled?

tkyang99 on January 10, 2012 at 12:23 PM

blink on January 10, 2012 at 11:53 AM

It’s coming out soon:

Did you know that BAIN actually contributed money in 2008 for Obama’s election????

coach1228 on January 10, 2012 at 12:38 PM

blink on January 10, 2012 at 12:27 PM

Right, it’s the messenger and the timing, not the message. Enjoy.

Cindy Munford on January 10, 2012 at 12:41 PM

This is the rhetoric that works with the American voter. Thus, I have zero faith in the American voter. Voters want politicians to “create jobs” and punish the rich. This is why Obama is in office and will stay in office.

spmat on January 10, 2012 at 12:42 PM

blink on January 10, 2012 at 12:33 PM

[I]n October 1993, Bain Capital, co-founded by Mitt Romney, became majority shareholder in a steel mill that had been operating since 1888.

It was a gamble. The old mill, renamed GS Technologies, needed expensive updating, and demand for its products was susceptible to cycles in the mining industry and commodities markets.

Less than a decade later, the mill was padlocked and some 750 people lost their jobs. Workers were denied the severance pay and health insurance they’d been promised, and their pension benefits were cut by as much as $400 a month.

What’s more, a federal government insurance agency had to pony up $44 million to bail out the company’s underfunded pension plan. Nevertheless, Bain profited on the deal, receiving $12 million on its $8 million initial investment and at least $4.5 million in consulting fees.

Mitt…can you explain this to Indy’s and Moderates that say that you’re “electable”? (Crickets)

coach1228 on January 10, 2012 at 12:43 PM

i’ll assume from here forward that anyone supporting Gingrich/Perry is a RINO

burserker on January 10, 2012 at 1:20 PM

I’m watching Newt Gingrich now play the “Occupy” card. I had liked him in the past from his debate performances. Now he is using the same rhetoric as Obama.

maddmatt on January 10, 2012 at 1:25 PM

Did you know that BAIN actually contributed money in 2008 for Obama’s election????

coach1228 on January 10, 2012 at 12:38 PM

So what? Many free enterprise companies did. That doesn’t mean that there is anything wrong with the type of business that a company practices.

blink on January 10, 2012 at 12:43 PM

Ah…yeah that. Reveals who you are and an indirect way support Bain/Romney….support it.
Thanks for letting US know….

Taxpayer money bailing a Pension fund out is a FEDERAL BAILOUT!!

Bain Made millions….while Taxpayers were left with the bill.

You may spin this anyway you want……

coach1228 on January 10, 2012 at 1:31 PM

I’ve not read the other posts in this thread, but I’ve been thinking about this a lot. I supported Newt. Now? I do not understand this attack at all. I was also getting a bit soft in my support when I heard him whine about the Romney pac commercials. I saw the commercials and they were very bad, but easily addressed through facts and reason. Newt didn’t choose that path. Challenging Romney to a one on one was such a loser choice in approaches. I could have told him he was trapping himself. And master debater that he is, why didn’t he explain that the 1.6 million was paid to his company, not himself personally? I made that argument 3 weeks before he did.

Looks like the establishment was right about a tendency to shoot himself in the foot, and right now? I’m getting a bit sick of his bolstering his argument with the “I” and “Reagan” argument. Reagan let his ideas stand on their own merit rather than the endless dependance on the logical fallacy argumentum ad verecundiam. Or take to quoting Milton Freidman for heaven’s sake (are you listening Mr. Romney?).

I didn’t see the Sunday debate, but Newt made the best debating point in the whole thing and I was beginning to reevaluate in a positive way. (Romney handled the George S question about contraception just right. Newt, however, hit it out of the ball park when he talked about the unintended consequences of putting homosexual relationships on the same footing as traditional marriage. Why didn’t someone else say that?) Santorum needs to apply both these arguments in defending his positions because saying these aren’t at the top of his list of problems when he’s spent a lot of capital saying they are isn’t a winning argument either.

I’m sorry though, this attack on investment capital makes no sense unless you are a socialist/Marxist. I know he doesn’t believe that but he’s arguing that and defending this reasoning is much, much worse than sitting next to Pelosi on on a couch.

I think I’m moving toward Santorum and only wish he’d take some debating pointers from Newt. There are central arguments to every issue and I want someone who recognizes a straw-man and a trap and the supreme importance of defining terms.

Portia46 on January 10, 2012 at 2:02 PM

These two clowns just cooked their own goose.

LizardLips on January 11, 2012 at 8:24 PM