In the general election, I’ll be pointing out that the president took the reins of General Motors and Chrysler, closed factories, closed dealerships, laid off thousands and thousands of workers. He did it to try to save the business.
Thus begins likely Republican nominee Mitt Romney’s defense of his activities at Bain Capital, a vulture private equity fund that made its money at least in part from taking over sick companies, looting their assets, laying off their workers, and leaving their communities destroyed in the process. It is a defense designed to accomplish multiple objectives at once: defend his practices at Bain Capital as business-saving measures; attack President Obama as a job-killer; and undermine what is widely expected to be one of the greatest strengths of President Obama’s reelection campaign—his determination, in the face of staunch opposition, to save the American auto industry.
To begin with, this comparison is dangerous ground for Romney. In stark contrast to President Obama’s gutsy, make-or-break decision, Romney advocated for a completely different approach to the floundering American automakers: let them go bankrupt, apparently with no concern for the workers at those companies themselves or all other smaller businesses that supplied them. This stark contrast in policies and values will be a key contrast for the president to use against Romney. Romney’s defense is hypocritical first and foremost because he is comparing his actions at Bain Capital to policies that by his own admission he would not have engaged in. But more to the point, it’s also a defense that makes him completely disqualified to be president of the United States. Romney’s supposition that his actions at Bain Capital have any relation to those of the president toward American automakers shows a complete lack of understanding of the relative purposes of the private sector and the public sector. It shows a total lack of understanding about the role of the working class in any other capacity than people who can make money for him. And it shows the difference in ethnics and perspective between a vulture capitalist and a community organizer from Chicago.
The very idea that being a leveraged buyout kingpin makes one qualified to run the largest economy in the world is the result of a disease in American thinking: if we only ran the country more like a business, we as a nation would be more successful. Clearly, the truth is far more complex. In a private business, reducing employee salaries can result in increased profits, but in a national economy, those salary reductions will have a cascading effect as the economic output of those same workers is reduced. But even then, that idea was tolerable back when “running a business” was more associated with the antiquated notion of having a strategy for long-term growth. From that perspective, making investments in employees for the sake of improving productivity or attracting top talent would have been considered as sensible as a government making long-term investments in education to improve the quality and productivity of its future workforce.
But that’s not the type of long-term management and vision Mitt Romney has any experience with at all. His experience is in short-term vulture capitalism: guaranteeing the maximum rate of return for himself and his investing partners at whatever cost. If the highest rate of return could be made by saving and rebuilding the business, so be it. But if more dollars could be squeezed from a business by scrapping it and selling off the rubble than saving it, so be it: the only consideration Mitt Romney cared about was adding on to his stockpile of however many dozens of millions of dollars he is already hoarding (we don’t know how much since he won’t release his tax returns).
From a moral point of view, this should be a deal-breaker for the American people. Not because being part of the .1 percent of American incomes automatically disqualifies him—so, too, was Franklin Delano Roosevelt during his time—but because being the president of an entire nation requires a sense of empathy for the working class that is fundamentally incompatible with being a successful vulture capitalist.
But even if Romney’s supporters could make the case that he has the type of empathy and moral judgment that would be required of him to lead this country successfully, the larger question is whether he would even understand how to go about it. When Romney described President Obama’s rescue of the American auto industry, he said that President Obama did it to “save the business.” That perspective shows an absolute lack of understanding of the motivations a president must have when making decisions on whether to intervene. President Obama did not do it to save a business; he did it to save an economy. Romney speaks of the rescue as he might about an investor of last resort baling out a struggling company in the hopes of a long-term rate of return should the company return to health, as if the decision could be so simply boiled down. Romney does even seem to have the perspective that it’s not about the individual business: it’s about all the businesses that depend on that business. It’s about all the workers who make money at that business. It’s about all the goods and services that those workers purchase with that money, and about what those providers purchase in turn. It’s not just a business; it’s not even just an industry. It’s about the entire local economies that are dependent on that industry—economies that, if Mitt Romney had had his way, would have become hollowed-out shells that would always reminisce about days long gone by.
In the general election, voters will face a crucial choice. It will be a choice between a candidate who understands that an economy needs to work for everybody, and a candidate who can’t see past whether his fellow investors make or lose money on the deal.