David Stockman: ‘Mitt Romney: The Great Deformer’

Posted by AzBlueMeanie:

Former Reagan budget director David Stockman takes a scalpel to Romney and brutally disects his claims of being a job creator in Newsweek. Mitt Romney: The Great Deformer (excerpt):

Mitt Romney claims that his
essential qualification to be president is grounded in his 15 years as
head of Bain Capital, from 1984 through early 1999. According to the
campaign’s narrative, it was then that he became immersed in the toils
of business enterprise, learning along the way the true secrets of how
to grow the economy and create jobs. The fact that Bain’s returns
reputedly averaged more than 50 percent annually during this period is
purportedly proof of the case—real-world validation that Romney not only
was a striking business success but also has been uniquely trained and
seasoned for the task of restarting the nation’s sputtering engines of
capitalism.

Except
Mitt Romney was not a businessman; he was a master financial speculator
who bought, sold, flipped, and stripped businesses. He did not build
enterprises the old-fashioned way—out of inspiration, perspiration, and a
long slog in the free market fostering a new product, service, or
process of production. Instead, he spent his 15 years raising debt in
prodigious amounts on Wall Street so that Bain could purchase the pots
and pans and castoffs of corporate America, leverage them to the hilt,
gussy them up as reborn “roll-ups,” and then deliver them back to Wall
Street for resale—the faster the better.

That
is the modus operandi of the leveraged-buyout business, and in an
honest free-market economy, there wouldn’t be much scope for it because
it creates little of economic value. But we have a rigged system—a
regime of crony capitalism—where the tax code heavily favors debt and
capital gains, and the central bank purposefully enables rampant
speculation by propping up the price of financial assets and battering
down the cost of leveraged finance.

So the vast outpouring of LBOs in recent decades has been the consequence
of bad policy, not the product of capitalist enterprise.

* * *

In truth, LBOs are capitalism’s natural undertakers—vulture investors
who feed on failing businesses. Due to bad policy, however, they have
now become monsters of the financial midway that strip-mine cash from
healthy businesses and recycle it mostly to the top 1 percent.

This lengthy report goes into great detail. Well worth the long read if you are serious about learning about who Willard "Mittens" Romney really is. It's not a pretty picture.