‘Mittens’ Romney is Gordon Gekko, ‘the guy who laid you off’

Posted by AzBlueMeanie:

The New York Times today takes an in-depth look at Vulture Capitalist Willard "Mittens" Romney at Bain Capital. "Mittens" Romney IS Gordon Gekko. After Mitt Romney Deal, Company Showed Profits and Then Layoffs:

Mr. Romney’s company, Bain Capital, sent in a team of 10 turnaround experts from Boston to ferret out waste, motivate executives and study untapped markets.

By the time the Harvard M.B.A.’s from Bain were finished, sales at the medical company, Dade International, had more than doubled. The business acquired two of its rivals. And Mr. Romney’s firm collected $242 million, a return eight times its investment.

But an examination of the Dade deal shows the unintended human costs and messy financial consequences behind the brand of capitalism that Mr. Romney practiced for 15 years.

At Bain Capital’s direction, Dade quadrupled the money it owed creditors and vendors. It took steps that propelled the business toward bankruptcy. And in waves of layoffs, it cut loose 1,700 workers in the United States, including Brian and Christine Shoemaker, who lost their jobs at a plant in Westwood, Mass. Staggered, Mr. Shoemaker wondered, “How can the bean counters just come in here and say, Hey, it’s over?”

Mr. Romney’s career at Bain Capital, which he owned and ran as chief executive, is a cornerstone of his campaign for the Republican presidential nomination[.]

It is a myth.

From 1984 to 1999, Mr. Romney and his deputies made fortunes by investing in, acquiring and then selling about 150 companies. It was high-stakes work that shaped Mr. Romney’s values and views, taught him the art of salesmanship and negotiation and took him deep inside the boardrooms and factories of American business.

Because financial data for many of the acquisitions are not publicly available, it is difficult to fully tally the wins and losses, the jobs created and the jobs eliminated on Mr. Romney’s watch. But the experience with Dade, Bain’s biggest transaction at the time, shows how Bain managed its investments, structuring deals so it would be hard for Mr. Romney and his partners not to come out ahead.

Bain and a small group of investors bought Dade in 1994 with mostly borrowed money, limiting their risk. They extracted cash from the company at almost every turn — paying themselves nearly $100 million in fees, first for buying the company and then for helping to run it. Later, just after Mr. Romney stepped down from his role, Bain took $242 million out of the business in a transaction that, according to bankruptcy documents and several former Dade officials, weakened the company.

Even some people who benefited from that payday and found it reasonable at the time now question it. “You would have to say, looking back, that it was too large, because it pushed us into bankruptcy,” said Robert W. Brightfelt, a former Dade president who collected more than $1 million.

In time, the over-leveraged company was forced to file for bankruptcy protection — and accused Romney’s firm of “professional negligence” and “unjust enrichment.”

Four years ago, Mike Huckabee contrasted his style as a candidate with that of Mitt Romney’s style: “I want to be a president who reminds you of the guy you work with, not the guy who laid you off.” Political Animal – ‘The guy who laid you off’:

It was a sharp quip because it hit close to home: Romney’s private-sector background involving laying off a lot of American workers.

The former Massachusetts governor has two broad flaws as a presidential candidate. The first is that he’s a craven, cowardly flip-flopper who shifts with the winds and demonstrates a practical allergy to principled stands. The second has to do with Romney’s record on jobs — specifically, how abysmal it is.

During Romney’s one term as governor — his only service in public office — his state’s record on job creation was “one of the worst in the country.” How bad was it? During his tenure, Massachusetts ranked 47th out of 50 states in job growth.

But it’s his private equity firm, Bain Capital, that should cause the real political headaches.

* * *

It reminded me of a recent piece from Frank Rich, describing Romney as a “poseur” who pretends to care about working people, and whose attempts at claiming credibility on unemployment are truly laughable.

No one doubts that Romney is a shape-shifter par excellence, whether on abortion, health care, cap and trade, or the Detroit bailout (which he predicted would speed GM and Chrysler to their doom). In his last presidential run, he was caught fabricating both his prowess as a hunter and a nonexistent civil-rights march starring his father and Martin Luther King. But to masquerade as a latter-day FDR is a new high in chutzpah even by his standards. […]

It’s a record Romney perennially tries to cover up. It may have cost him his Senate race against Ted Kennedy in 1994. In that campaign, Romney was stalked by a “Truth Squad” of striking workers from a Marion, Indiana, paper plant who had lost jobs, wages, health care, and pensions after Ampad, a Bain subsidiary, took control. Ampad eventually went bankrupt, but Bain walked away with $100 million for its $5 million investment. It was an all-too-typical Romney story. […]

That Romney thinks he can pass himself off as the working stiff’s savior and Obama as the second coming of the out-of-touch patrician George H.W. Bush of 1992 truly turns reality on its head. 

There was also this gem from Stephen Colbert:

“You see, Romney made a Mittload of cash using what’s known as a leveraged buyout. He’d buy a company with ‘money borrowed against their assets, groomed them to be sold off and in the interim collect huge management fees.’ Once Mitt had control of the company, he’d cut frivolous spending like ‘jobs,’ ‘workers,’ ‘employees,’ and ‘jobs.’ […]

“Because Mitt Romney knows just how to trim the fat. He rescued businesses like Dade Behring, Stage Stories, American Pad and Paper, and GS Industries, then his company sold them for a profit of $578 million after which all of those firms declared bankruptcy. Which sounds bad, but don’t worry, almost no one worked there anymore.

“Besides, a businessman can’t be weighed down with a bleeding heart. As one former Bain employee put it, ‘It was very clinical…. Like a doctor. When the patient is dead, you just move on to the next patient.’”

Colbert presented Romney as a cross between Gordon Gekko and Jack Kevorkian, which sounds about right.

Gordon Gekko, er, "Mittens" Romney should "find it very difficult to convince working families not to laugh in his face when he asks for their votes."