The New Anti-Romney Ad And The Death Of “Compassionate Conservatism”

If there’s anyone out there who still worries Barack Obama may not have the mettle to run the salt-the-earth negative campaign that his stewardship over a lackluster economy requires, they need to stop. Right now. Watch the video above, the latest ad from the unofficial White House Super PAC, if you doubt me.

If you can’t watch the video, here’s its intended takeaway: Due to his boundless greed, Mitt Romney laid off an innocent steel worker, stripped him of his medical insurance, and let the man’s wife die of undiagnosed cancer as a consequence. And he doesn’t even care.

That’s about as cutthroat an ad as you’re going to see from a Presidential campaign. (Of course, technically, Super PACs and campaigns are not supposed to coordinate with one another… technically.) To a significant degree, however, it doesn’t represent anything new. In other words, Democrats are continuing Phase I of their anti-Romney strategy while at the same time enacting a slow rollout of Phase II. Brief reminder: Phase I involves establishing Mitt Romney as the type of plutocrat who’d trip Tiny Tim and laugh about it; Phase II is about showing how the GOP platform is a policy manifestation of Romney’s Robber Baron ways.

Nuking a guy’s job and killing his wife in order to move from the .01 percent to the .001 percent? As far as American workers are concerned, that’s about as Robber Baron-y as a modern capitalist’s likely to get.

So the ad’s viciousness is noteworthy more for its difference in degree rather than kind — but that’s not the only thing going on. d At the very end of the commercial, the narrative lens shifts from the steelworker’s tragic story to his perception of how Romney would feel upon hearing it. He first says that Romney doesn’t “realize” the havoc he’s wrought; but then he says — and this is the final word of the ad — “I do not think Mitt Romney is concerned.” It may sound like a minor or even irrelevant change in focus, but I think it tells us something significant about how Obama’s team thinks the President will win.

Despite Republican claims to the contrary, Obama is most decidedly not running for reelection as an anti-capitalist. As any lefty will tell you, probably with no small amount of bitterness, Barack Obama’s antipathy for the free market system has been greatly exaggerated. (If nothing else, four years of Tim Geithner as Treasury Secretary should put those kind of questions to rest.) That’s not to say that there are no differences between Obama and Romney’s approaches to capitalism and the state. There are. But they’re in a sense differences of temperament — or, to use the ad’s chosen phrase, “concern.”

Fundamentally, Obama’s got no problem with Mitt Romney’s private equity work. Back when this issue was first raised by Democrats, Obama called private equity “a healthy part of the free market” that is “set up to maximize profits.” What Obama has challenged, then and now, is Romney’s assertion that his sterling work in private equity can be pointed to as a model for how successful he’d be as President. Obama’s counter is simple: The skills required to excel at the former are not necessarily conducive to being good at the latter. You can be a good butcher, but that doesn’t automatically mean you’d make a great chef.

An equivalent distinction holds true when you compare the two men’s views on post-industrial capitalism in general. Neither candidate wants to significantly alter the contours of today’s economic system. They both not only accept the status quo’s “creative destruction” as inevitable, but embrace it as an overall good. Yet while Obama supports the free market with caveats, arguing that the sometimes destructive nature of capitalism requires the state to offer its citizens palliative services, Romney’s endorsement of the free market is total, unburdened by all that troublesome nuance. He’s unconcerned.

Now, I doubt Romney actually doesn’t care about this steelworker or his now-deceased wife. He’s become a rightwing Republican, sure, but he’s not a monster. Yet a central tenet of today’s GOP holds that one’s concerns over the hardships of capitalism should not be translated into public policy. It’s a private matter, one for Churches and other pillars of civil society to worry about — not the state. Most Democrats, Obama included, hold a different view. They’d argue that while civil society is essential, it’s not enough. They’d call Republicans heartless, uncaring, cold.

The New Anti-Romney Ad And The Death Of "Compassionate Conservatism"

Republicans have historically tried to rebut these charges by moderating their policy platform and by portraying their candidates in the most humanizing, caring light possible. “Compassionate conservatism” is but the most recent and most shrewdly conceived iteration of an age-old gambit. It’s worked, too. Bush the younger’s domestic policies were in many ways regressive and geared towards distributing wealth upward. But he had compassion, and that branding was enough to assuage any worries voters might have about voting for someone so rightwing.

Romney’s at a twofold disadvantage as compared with Bush. For one thing, he’s not as talented a politician as Bush; when he tries to empathize with his audience, it doesn’t work. He sounds like an actor — and a bad one at that. Even worse, though, is the way the GOP has moved rightward from Bush. It may be a bitter joke to the Left, but “compassionate conservatism” is, to much of the Right, a hideous memory, a gateway drug to big government spending à la Bush’s Medicare Part D. If you’re a GOP pol who wants to survive the Tea Party onslaught, you run away, fast, when “compassionate conservatism” enters the room.

For Mitt, the GOP’s lurch to the right — both in style and substance — has made it more difficult than ever for to successfully combat the usual Dem charges of inhumanity. And that’s what the Obama Team is exploiting in this new ad. It’s an irony only the weird, hypocritical, discombobulated world of American politics could produce: In order to be kind, Democrats are being very, very cruel.

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324 thoughts on “The New Anti-Romney Ad And The Death Of “Compassionate Conservatism”

  1. The mythos you’re trying to create might work, so long as no one knows, you know, what the fuck happened at GS Steel. But this attack ad like the previously documented attacks on Bain “outsourcing” is just falsehood piled on top of prevarication. That guy in the ad supported his union, but the union didn’t support him. I’ve seen companies and whole towns destroyed by unions. Why didn’t he go to his own union for health care benefits?

    But why would you let facts get in the way of propaganda? This ad will work great for stupid voters but Obama already has the stupid voters sewn up. He should save his ammo.

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    • I’d beg to differ. The only defence anyone can make for Bain Capital and its record is to say Bain was just doing it better. Bain made enormous short-term profits by saddling good companies with tremendous debt loads. These are pretty much undeniable assertions. If everyone else was doing it at the time, that’s irrelevant. I watched Chainsaw Al Dunlap wreck Scott Paper the same way.

      Everyone was doing it and nobody gave a damn about the trail of devastation these assholes left in their wake. You can say what you like about Bain Capital and point out where folks are wrong about it. But times were awfully good for consultants like me in those days as good corporations were plundered and trashed. You know I’m right.

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      • Blaise, was GS in trouble BEFORE Bain? The answer is yes and therefore the case is closed. Furthermore they only shuttered the single plant, the rest stayed open with their new technology and their 3500 employees.

        Too long, didn’t read?
        The irony, says Mr. Huselton, is that this plant “wouldn’t even be in today’s news, if it hadn’t been the opportunity that came with Bain. Those jobs would have been gone in 1993.”

        That’s a more revealing story—of the pressures of a global market, the dangers of an inflexible workforce, and the opportunities that come with private equity and risk-taking. It’s just not one Team Obama wants to tell.

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        • Was GS in trouble? I don’t have access to their financials or their BK filing. I do know this: they invested 8 million and got 12 million out of it. And 4.5 million in “consulting fees”. And a bailout. If you don’t think there’s anything wrong with this picture, I don’t know what I can say which might convince you there is.

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        • And just for the record, I no longer take WSJ seriously. I read Investor’s Business Daily and Reuters and Bloomberg assiduously. But there’s no reason to believe anything WSJ has to say. Kinda sad, I used to love that paper. Not since Murdoch took it over. He’s like King Midas in reverse, everything he touches turns to shit.

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          • How could Bain have been the majority investor on $180 Million worth of paid in capital with only $8M? No wonder you don’t like the WSJ, they’re the paper of record (and Strassell predates Murdoch by more than a decade so you’re in the shit there). The Gray Lady can’t be trusted for much more than wrapping fish and lining bird cages. I don’t blame you for not liking the WSJ, how can you stay liberal and put up with the cognitive dissonance? I know libs who quit the WSJ many years before Murdoch had anything to do with it. They just didn’t like what they saw on the editorial pages. WSJ prints op ed pieces from anyone with a pedigree, it isn’t their fault the pablum proffered up by the Left don’t stand up to scrutiny any more than your made up investment numbers.

            Here’s another (even better source) to back my play. Your facts are false the full investment was considerably north of your imaginary number and until you come up with something like a source I won’t bother to refute that falsehood. They were MAKING MONEY until the Asian crisis in 1997 caused Asian companies to dump steel on the US market at below cost. This is all well-known even if it doesn’t fit into your Snidely Whiplash characterization.

            We could have a long discussion about all the jobs Obama has created in his private life. Long if a nanosecond is long to you.

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        • This was an awful deal. It’s an example of bending the tax code and bankruptcy rules to benefit Bain. Not all of the workers lost their jobs long term, because they were productive. Sure that’s good. But the pension got killed. They company had an obligation to pay these guys their benefits. But Bain loaded the company with debt to run the company while extracting huge dividends. The resultant financial problems the company faced gave them an opportunity to loot the pension.

          That sort of LBO isn’t technically illegal, but it sure should be.

          No one would’ve cared of the business had gone bankrupt and restructured. It went bankrupt because of debt it took on while its current owners extracted cash. Then they left the company, helping themselves and hurting pensions.

          Bankruptcy is fine. Its good for the economy in the long run. We all get that. (as long as its not a major business during a major recession.) New companies form in the ashes of the old one. Fine.

          This was an LBO, and a dirty LBO at that. The economy and workers would be better off without this kind of LBO.

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    • btw, wardsmith, has anyone ever mentioned to you that Jefferson apparently never said “Dissent is the highest form of patriotism,” and that the lines seems to go back to the 1960s anti-war movement, via the late leftist historian Howard Zinn and past ACLU President Nadine Strossen?

      http://www.monticello.org/site/jefferson/dissent-highest-form-patriotism-quotation

      http://urbanlegends.about.com/b/2005/02/15/misattributed-dissent-is-the-highest-form-of-patriotism.htm

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  2. Elias is right to think that Romney isn’t apathetic about the plight of this steelworker and his wife. If he didn’t care, then he wouldn’t have passed a health care reform in MA that, if replicated nationally, would have insured that they had insurance with which to pay for her cancer treatment.

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  3. “It’s an irony only the weird, hypocritical, discombobulated world of American politics could produce: In order to be kind, Democrats are being very, very cruel.”

    in order to use power, one must first grasp it? that’s ironic like rain on your wedding day, bro.

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  4. “What Obama has challenged, then and now, is Romney’s assertion that his sterling work in private equity can be pointed to as a model for how successful he’d be as President. Obama’s counter is simple: The skills required to excel at the former are not necessarily conducive to being good at the latter. You can be a good butcher, but that doesn’t automatically mean you’d make a great chef.”

    But has Romney made that assertion? If I were Romney, when all the criticism of Bain came out and when things like this are thrown around, I’d say this: “My roles and responsibilities in those positions were different than they will be when I’m elected President. I had different obligations, different constituents, and different bottom lines. And you know what? I satisfied them all. My success is not because of any specific tactic I used which necessarily bear repeating. My success is because I was able to evaluate situations, identify problems, and come up with solutions. A skill set I will use just as effectively when I’m President. To use your analogy, I was a great butcher not because I use my meat cleaver 24/7; I was a great butcher because I took the time to learn to be one. And in anticipation of being a great chef, I’ve been learning the necessary skills for that job as well.”

    But, hey, that’s just me.

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  5. ““compassionate conservatism” is, to much of the Right, a hideous memory, a gateway drug to big government spending à la Bush’s Medicare Part D.”

    Indeed. It’s what led to the furious rejection of Pres. Bush in 2004, and the successful primary challenges to Medicare Part D supporters like Paul Ryan, Mitch McConnell, and John Boehner.

    That is, today’s talking points demand that Republicans profess to be really really mad about Medicare Part D, but they only discovered they hated it about five years after it passed. Had Pres. Bush retained his popularity among Americans, no Republicans would bother to dislike Medicare Part D any more now than they did then.

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  6. These ads are desperate and will fail. Political operatives haven’t grasped that the Information Age is maturing and that this election will be different from all other elections when it comes to propaganda and negative ads. Falsehoods are dispelled in a matter of seconds, and alternative media sources have grown to become influential.

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    • The facts about Bain Capital are not on Romney’s side. Romney needs a crisis management team to do more than deny these allegations, he needs to prove they’re not true, y pronto. Honest men have nothing to hide.

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    • this election will be different from all other elections when it comes to propaganda and negative ads.

      Yup. Given the lack of any controls on campaign spending, there will be way more of them.

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  7. Hard cases make bad presidents.

    At any rate, I like this line: “You can be a good butcher, but that doesn’t automatically mean you’d make a great chef.” True, as far as it goes. But Romney was a chef, too, just in a smaller restaurant. Obama, he’s not even try to sell his own food anymore, he’s just going around telling people the other guy uses dog meat.

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    • So that’s what happened to Seamus. Romney sold him for dog meat. Well, I’m sure first Romney borrowed cash, set up a shell corporation to buy Seamus, only to sell him to the dog meat consortium. I mean, he’s running for office and trying to make profit for pete’s sake.

      Also, I’m sure conservatives would like to point out that they’ve heard that Obama likes dog meat.

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      • Dn’t be so dismissive of the Soylent Old People hypothesis.

        Have you ever eaten at a Mormon restaurant? The meat all tastes like pork, suspiciously.

        I’m not saying Romney and all Mormons eat old Christians. I’m just saying we all have questions and we’d like him to release his ingredients list. Not just the copy. The original recipe. I mean, what is he hiding? Why not release the ingredients, if they really are pork products.

        I just think Romney (R-Kolob) could be more forthcoming.

        Please take this in the spirit of irony it was meant in. I think Romney’s Mormonism is his best attribute.

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  8. One more thing. If Obama had any transformational insight, he would realize that his best chance is straight-up honesty — that the economy was bad, what they tried failed to create the necessary job growth, but that if voters will give Democrats power to pass the required stimulus/infrastructure efforts, they will do everything within their power to put people bcak to work. I don’t agree with the stimulus plans, but it’s Obama’s best shot. What Obama is doing right now, along with Reid, is showing a mean dishonest side that will be roundly rejected. People listen to Romney and they realize he’s not a monster, so they say to Democrats –Stop the nonsense and tell us why we should vote for Obama and not Romney.

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    • Want some reasons? Or is that just a Rhetorical Flourish?

      Let’s assume, however improbably, that you’re serious. Mitt Romney is the exemplar of the wisdom of his age, an age which established the primacy of the stockholder at the expense of all other considerations. I simply do not believe you are serious about Necessary Job Growth, not if you still prefer Romney. Romney represented his investors and himself. He looked at the numbers like a cattle judge looks at a beefer and if he complimented that creature, it was in terms of its hang weight on a butcher’s hook.

      This sort of viewpoint is admirable, in its way. I am no judge of cattle but I attend cattle judging events at the Northern Wisconsin County Fair. Cattle are meant to be slaughtered, they do not die of old age. They are born and raised with that butcher’s hook as their ultimate destination.

      Do not trouble us with all this unctuous hand wringing. If you cared about American jobs, you’d care about corporations which employ Americans. Corporations are not cattle, destined for slaughter. Stimulus? Infrastructure? Romney’s built a beautiful, sanitary, scientific and totally up to date slaughterhouse for American corporations. And this is the jackass you want to elect as President of the United States of America?

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      • “not if you still prefer Romney.”

        I’m not sure why you have to turn everything personal and make assumptions about what I believe and who I support, but it’s annoying. I was just giving a little analysis.Sometimes people can discuss situations objectively — sometimes they can’t, I suppose.

        It’s also annoying to defend the truth about certain situations, say like making a claim that an ad is not fair to a Republican, then be accused of being a Republican in the tank for Romney. I’m not saying you did this, but it’s an example that reflects what you and others around here tend to do. I look at both Romney and Obama as statists with different uses for State power. I’m hoping that the limited government/free market/non-interventionist faction which is arising on the Right (much like the Old Right against FDR) will influence Romney — it definitely won’t influence Obama. Gary Johnson is a fraud and I won’t vote for anyone the Libertarian Party puts forth — they’ve gone off the rails.

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        • MFarmer, why exactly do you say that Johnson is a ‘fraud’ and the LP is ‘off the rails’? I think they are a damn sight better than last go-round. You want to talk a fraud – Bob Barr? Who was he kidding?

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            • Pretty much. I had a higher opinion of Babar than most, but I can’t say I didn’t understand where his opponents were coming from. Gary Johnson, though? He’s as close as yu can come to an ideal LP candidate. He’s Ron Paul without the crazy ass conspiracy theories, poorly concealed racism, and social conservatism streak.

              But hey, Johnson’s clearly a fraud; everyone knows that Romney is honest and transparent….

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                • Exactly. He’s nothing at all. Which makes him Something. Or something.

                  (Half seriously- Johnson is kind of like the dude- it’s always a dude- who runs for student government in college on a platform that ridicules the entire concept of student government and especially everyone involved with it. Every once in a blue moon, that dude wins – see, e.g., NC State Pirate Captain. The self-important resume builders that populate student government are appalled by the candidate’s very existence, and predict something along the lines of collegiate social apocalypse when that dude actually wins. In reality, of course, awesomeness happens -student government is exposed for the worthless charade of resume building self-importance that it is, social apocalypse does not occur, and the student newspaper’s weekly student government column gets filled with pirate stories, which everyone, EVERYONE loves. No one loses, everyone wins. Well, everyone except for self-important resume builders in student government that is.)

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                • Seriously, Mike, you defend Romney at every single possible chance, even getting offended by lighthearted jokes about Seamus, and viciously rip every other candidate even when they’re not a topic of discussion – up to and including the LP candidate, who is undeniably 1000 times more libertarian and 1000 times more consistent than Romney.

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                  • I haven’t been following this all that close enough to know if this is true or not, but somebody ought to be defending Romney here. Willard “Mitt” Romney is the personification of greatness in contemporary American political culture, and as a candidate for President, far better than we deserve.

                    It’s funny to me that people such as James and yourself (thinking about the Gary Johnson stuff downthread) want to make all sorts of excuses and rationalizations for half-measures on behalf of a no-hoper nonetheless invest a fair bit of energy in invective against the one guy who’s actually in a position to help things.

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                    • Willard “Mitt” Romney is the personification of greatness in contemporary American political culture, and as a candidate for President, far better than we deserve.

                      Note to self: do not read Koz comments while eating or drinking. Keyboards do not grow on trees.

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                    • It’s his greatness that is the problem, koz. the man is not a persuader, simply a little man waving his hands about and calling out orders.

                      A decent king,a nd a horrible president.

                      What is it about the rihtwing that they think the president should be able to command the country? (leaving aside CiC duties, of course)

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                    • Sorry, koz, but I don’t think Romney would actually help much of anything, from a libertarian perspective. Doubling Gitmo prison camp and continuing our overspending on the military are much more of an affront to my libertarian sensibilities than PPACA, even though I don’t like it, either. Your party offers me someone who’s no more libertarian than the current prez, just statist on a different tangent, and you want me to cream my pants for him? How delusional is that?

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                    • Well yeah, maybe this would be a good time for you to be giving ground on your libertarian sensibilities then.

                      We’ve built up so much sclerosis in the American polity that, with maybe a few exceptions, it’s no longer really plausible to think we can directly affect policy initiatives (like Gitmo, etc.) through voting for this or that candidate anyway. And even if we could it would be an extremely myopic thing to do anyway.

                      What Willard “Mitt” Romney does, among other things, is put a lot of good things in play that would otherwise be foreclosed on. Almost uniquely in our current political culture, he has the capability of managing and reorganizing bureacracies into effectiveness and fulfillment of purpose. I don’t see how anything really important, really good can be accomplished in our politics until that happens.

                      In any event, back to your libertarian sensibilities: why do you deserve them? Why do you expect that they can or should be fulfilled? Certainly they are not fulfilled for residents of North Korea, why are you any different? I don’t mean to suggest that there is no answer to that question but I wonder if you have ever given any thought to it, in a way where you have really internalized whatever your answer is.

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                    • Invective towards Romney? Not really, or at least not of late. Bemusement at those who think the Honor Code Party or the Students for More Student Protests Party is meaningfully better than the other while bemoaning the Pirate Captain Party’s unseriousness? Totally.

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                    • “Bemusement at those who think the Honor Code Party or the Students for More Student Protests Party is meaningfully better than the other while bemoaning the Pirate Captain Party’s unseriousness?”

                      Well yeah, you do realize that the federal government is meaningfully different in important ways that student government in college, right?

                      Some people, like Willard “Mitt” Romney, are capable of managing real institutions with real powers like the US federal government toward effectiveness and fulfillment of purpose. In difficult situations like the present, they are the ones we should support.

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                    • Koz, if the Republicans want the Libertarian vote, they should, at the very least, pander for it with half the enthusiasm that they push for, say, a decent chicken sandwich.

                      I’m content knowing that the Republicans knowing that they can’t win without the Libertarian votes. I will enjoy explaining to them, and you, that the Republicans might have won if they had had them… and then we can talk about what was within their power to say and/or do in order to get them.

                      For now, I’ll just point out that I’d rather see what the Republican party turns into after Romney loses than see what happens if the Republicans win.

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                    • “Koz, if the Republicans want the Libertarian vote, they should, at the very least, pander for it with half the enthusiasm that they push for, say, a decent chicken sandwich.”

                      Heh. If Republicans actually cared about what Libertarians want, supporting Chik-Fil-A would be a pander to them. After all, somebody has to stand up for the rights of Americans to conduct their own affairs without having to kowtow to lib Political Correctness, meanly enforced by the little minions of lib municipalities. But everybody knows, that when an actual battle for freedom in America is taking place, the left-Libertarians take a powder, and the right-Libertarians look indistinguishable from Republicans.

                      “I’m content knowing that the Republicans knowing that they can’t win without the Libertarian votes. I will enjoy explaining to them, and you, that the Republicans might have won if they had had them… and then we can talk about what was within their power to say and/or do in order to get them.”

                      That line idn’t worked real well in 2010, did it Jay? But more than rehashing that argument again, it’s actually more important to understand that’s a phony argument on its own terms anyway. You just reiterate these things as a rhetorical stance, I don’t know if you’ve actually ever thought about what they mean as actual English words. Specifically, “I’d vote Republican if only they’d just X.” You might mean that in some way as you write it, but it always ends up being a lie. X happens, and then there’s some other bullshit reason to start hating on the Republicans again. People get this, and it’s why nobody believes you. For someone in your situation, horse trading almost never accomplishes anything. You have nothing to horse trade. It’s up to you to vote Republican in order to prove that you can, first.

                      “For now, I’ll just point out that I’d rather see what the Republican party turns into after Romney loses than see what happens if the Republicans win.”

                      Do you hate America or something? Otherwise, why can’t you simply vote for Willard “Mitt” Romney as the best interest of America as opposed to what will happen to the GOP if he wins vs. if he loses.

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                    • I just find it quite a bit comical that we’re actually going to elect a man named Willard as President of the United States. That, and the rhetorical tendency of some libs to refer to him as such in the hope of cheap point-scoring.

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                    • koz,
                      yes, someone needs tos tand up for those people.
                      someone also needs to stand up for the people with green aliens abducting their baby jesus.
                      someone also needs to stand up for the person who draws pornography on bibles and then shows them off at bus stops.

                      ain’t that the ACLU?

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                    • Why is “Mitt” in quotes? He goes by his middle name, just like Hiram Ulysses Grant, Stephen Grover Cleveland, Thomas Woodrow Wilson, John Calvin Coolidge and Sheila Ronald Reagan.

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                    • FTR, his middle name is Milton, after an older cousin [and a former Chicago Bear] also called “Mitt.” We need to know these things about our next president. There’s so little we know about the current one.

                      >;-O

                      The ruling on the field is that “Mitt” is actually most correct, although a waste of typing effort.

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                    • Not that I’m calling you out, Tom, but http://en.wikipedia.org/wiki/Mitt_Romney, for instance, says that Romney’s middle name is “Mitt”, after his cousin Milton, who was nicknamed “Mitt”. His official biography as governor of Massachusetts at http://www.mass.gov/portal/government-taxes/laws/interactive-state-house/historical/governors-of-massachusetts/commonwealth-of-massachusetts-1950-present/willard-mitt-romney-born-1947.html also says “Mitt”, not “Milton”. If you have references that say “Milton”, I’d be glad to see them, and will not quibble further if a mea culpa is required; I have no dog on this roof.

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                    • A. I did not “dog” Koz; I asked a question. Since Koz took it in good part, I have no idea why you’re being so offended on his behalf.
                      B. I haven’t seen it demonstrated that the full middle name isn’t really “Mitt”.
                      C, I’m done here, though, as I said, if you can point to a good reference that shows “Milton”, I’ll happily admit I had it wrong.

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                    • “…I have no idea why you’re being so offended on his behalf.”

                      Clearly Tom is still embracing compassionate conservatism. Or, as I like to call it, convenient compassion… demonstrating compassion for individuals when it is convenient or politically expedient and otherwise bashing compassion as some sort of PC plot.

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                    • I see your point, Mike, and it’s you who are indeed correct about “Milton.” I withdraw my objection. As for the “dogging” part, since you mocked Koz just a few comments before

                      Note to self: do not read Koz comments while eating or drinking. Keyboards do not grow on trees.

                      I dunno about the rest.

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                    • Mike, come on. The only time I’ve ever seen you use the “statist” perjorative for Romney, or any perjorative for him is when someone points out that you always defend him and attack everyone else; even then, you couch the perjorative with something to the effect of “but so is….”

                      And when have you defended Obama on anything?

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                    • Mark, I have defended Obama here and on my site when he’s been falsely accused of something or someone called him a communist. I’ve written posts explaining that he’s not a communist, just a statist, more like a social democrat, and I’ve said that I disagree with his ideas regarding government, but that I don’t hate him as a person. I’ve praised the historical achievement of his presidential victory and in the beginnign I wrote that I wished he would go against the establishemnt and do something that really shakes up the welfare/warfare state so that he becomes a great president. I ‘ve written lots about the lost potential Obama represents.

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                    • And, Mark, I wrote here just two days ago about conservative failures regarding governance and if Romney continues his statist ways, if he wins, it will be disastrous. Just two days ago here. So, make sure you are right before accusing me of things I haven’t done or ignoring the things I have done or written. I don’;t know what your problem is, but you are dead wrong about me and what I’ve written about Obama and Romney.You mistake objectivity for bias, somehow. When I see outlandish criticisms leveled against Romney I call people on it — not for Romney’s sake, but for the sake of the truth. If we are going to understand the flaws of both Obama and Romney, we need to consider the actual flaws, not hyperbolic smears and nonsense.

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                    • One more thing — no one here really criticizes Obama in the over-the-top fashion like they do Romney, so, of course, you won’t see me here defending Obama as much as Romney. On my site, though, I have been as objective as possible regarding Obama and Romney

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            • Well, I suppose sooner or later, someone would have to be accused of being a LINO.

              This time, it *literally* could not have happened to a nicer guy.

              If liberty is a vector, Johnson still looks far better than any other candidate.

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              • What Glyph said.

                The formula is trite, done before, and unhelpful to the libertarian movement: Ask an anarchist about a politician, then feign outrage that the politician is in politics. Good grief.

                I’d pay good money to see Robert Wenzel interview Mitt Romney. I wonder how that one would go. Don’t you?

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                • Ditto this. There’s no way in hell we’re ever going to jump from our current system to a minarchy, much less a stateless anarchy, in one move. But that’s what these folks insist on, forsaking the still small but more serious possibility of taking smaller steps in the right direction.

                  A step by step process is the appropriate way, too. It allows us to empirically test each stage against the theory, to make sure it’s all working as advertised.

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                    • This is why unprincipled, pragmatic libertarianism will fail — you are all willing to compromise principles which lead to loss of freedom. This is what happened to liberals in the 20th century when they pragmatically turned into statists and social democrats.

                      The least Johnson can do is state the libertarian principles and admit that he’s content with making progress, but to stand for 25% of a principle is fraudulent — what he’s proposing simply makes good sense from his perspective, nothing more than a pragmatic proposal — he’s using the Libertarian Party as a niche to gain recognition and speaking fees, maybe write a book. He’s not a revolutionary and we need a libertarian revolution, not the lukewarm crap that bonafide statists will sweep aside like it’s nonsense.

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                    • It’s the same weak compromise and principle-shrinkage that Cato went through when they moved to DC. Libertarians don’t need to be a part of the political game in DC — they need to be radicals for liberty. Many libertarians were never that libertarian, I suppose, or they have given in to the political pressure, but they sure have turned their backs on libertarian principles. What passes for libertarianism here is modern liberalism and nothing more.

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                    • If you say so.

                      Me, I’d prefer we hold off on the Purges until *after* we win.

                      Seriously, this makes sense to you? I am almost thinking my leg is being pulled here. A non-crazy candidate, who is reasonably devoid as far as anyone knows of outright nuttery or baggage, fairly likable, and you want to throw him over for someone more wild-eyed?

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                    • And what makes Romney so much better than Johnson? Is it the fact that he’s proudly marching in the wrong direction, just maybe not quite as fast as Obama (and even that’s debatable)?

                      Beyond that: It’s just plain silly to think that if only the LP nominated someone of utterly perfect principles, the American people would fall into line.

                      The first problem is there ain’t never gonna be a candidate who is perfect. The second problem is that even a perfect candidate won’t convince the American people to radically change their political views in the course of one election cycle.

                      In the meantime, there’s a competent former state governor. He balanced the budget, reduced the size of the government, held the line on taxes, vetoed more bills than all the previous governors combined, wants to legalize marijuana, opposes the USA-PATRIOT Act, would end the TSA, audit the Fed, repeal Obamacare…

                      I can’t think of a single issue area where he isn’t at least moving in a more libertarian direction. If I were to wait for a “better” candidate… well. Maybe some would. But in the meantime, why on earth would I vote for Romney?

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                    • “And what makes Romney so much better than Johnson?”

                      Holy shit, not you too, Jason? Where in the fuck have I said that I prefer Romney over Johnson? You guys are just making shit up becuase I don’t smear Romney in every other sentence. I have never said that Romney is better than Johnson — I’ve siad that if Romney is elected and he governs as a statist from the right, like Bush, then it’s all over. I said Johnson is a fraud when it comes to libertarianism, and he won’t get but a few votes. He would govern like a statist, just like Romney and Obama. If a faction on the Right can continue to gain influence, they might change the GOP to become a real opposition party, but they have to embrace non-interventionism, and I don’t think they will. I don’t see any good options right now. I seriously think we’re headed for collapse after a period of real un-freedom.

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                    • Speaking from the outside, as a Liberal right on the border of Libertarian, I don’t see Gary Johnson as a fraud. He is an actual Libertarian who governed by Libertarian principles, in the real world. Not. A. Fraud. An admirable man who stuck to his guns in New Mexico and some of us are keeping an eye on this guy as a standout, stand-up kinda guy on a stage full of bozos who are none of these things.

                      See, this is why I keep saying Libertarians are no different than the Marxists. It’s all theory with both. Out here in the real world, democratic and republican and libertarian are adjectives. In the theoretical world, they’re nouns. Somebody’s not perfect, therefore he’s unworthy. Theory never makes it off the written page intact, that’s Engels.

                      As for Cato, I’ve been steadily reading away. I don’t like everything but I like a great deal of what they’re saying. Government, like the advertisers, are making fraudulent appeals to get us to buy into their schemes. It’s time someone in government was ready to tell us the truth, that not all problems can be solved by waving a red-white-‘n-blue magic wand and our every need and shortcoming will be legislated into oblivion.

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                    • “Mike, have you considered that if everyone is coming to the same conclusion about your positions, and you don’t actually hold those positions, then maybe the problem is that you’re communicating ineffectively rather than that everyone has a vendetta against you?”

                      I’ve considered it, but outside this small group of like-minded thinkers who gang up on others who disagree with them, I have not had a problem with people understanding my positions. Plus, I’ve gone back and read through the conversations at times, and I see where this group think takes over and all of a sudden it’s you against me, but I didn’t start it — I just simply stated what I believe. The times I’ve checked there have been purposeful misrepresentations of what I’ve written and what I believe. I think that as a group, there are about 10 people here who need to do a personal inventory because they are treating dissenters unfairly. I’m surprised by your reactions here, because you usually show better sense and judgement. You’ve really been an ass.

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                    • “Beyond that: It’s just plain silly to think that if only the LP nominated someone of utterly perfect principles, the American people would fall into line.

                      The first problem is there ain’t never gonna be a candidate who is perfect. The second problem is that even a perfect candidate won’t convince the American people to radically change their political views in the course of one election cycle.”

                      It would be silly to think that the American people would fall behind someone with utterly perfect libertarian principles. I wonder who thinks that silly shit?As for me, I think libertarianism would be better served with a candidate who understands, accepts and articulates the libertarian principles full-throatedly. People might not jump in line, but at least they would know the principles and have to deal with a principled candidate.

                      I didn’t say we need someone perfect, and disliking Johnson doesn’t mean I’m demanding perfection, and I didn’t claim that a principled candidate wopuld change the political views of people in one cycle, so I don’t really know what the hell you are going on about. You see my dilemma, Jason? I say one thing, then you come back with all this stuff that doesn’t have anything to do with what I said.

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            • Thx for the link, Mr. Farmer. Gary Johnson as another phony bedroom & bong “libertarian.”

              “In the end, we can conclude that Johnson is not really libertarian, and not really liberal or conservative. No, Gary Johnson is a politician. And a statist politician at that.

              In that very revealing interview, we learned that Gary Johnson doesn’t really know or understand the basic moral, philosophical and economic underpinnings of libertarianism, of liberty: the recognition of the rights of the individual to self-ownership, the importance of non-aggression, the sanctity of private property, voluntary contracts and voluntary exchange.

              If Johnson is a libertarian, then he is more of a “lifestyle libertarian,” without any particular regard to the aforementioned principles of liberty. But Johnson is much more of a statist than a libertarian, and not just a minimal statist or minarchist, such as Jacob Hornberger of the Future of Freedom Foundation or Congressman Ron Paul, but a statist in general. To Johnson, it seems, the State comes first, followed by the people and whatever liberty or property the State lets them have.”

              http://www.economicpolicyjournal.com/2012/06/how-libertarian-is-gary-johnson.html

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              • Robert Wenzel and EconomicPolicyJournal.com would label absolutely anyone “unlibertarian” for absolutely any deviation from pure Rothbardian anarcho-capitalism. If you’re not 100% on board with Rothbard, you’re not a libertarian to him.

                The apposite analogy here would be someone claiming that no one is a true Republican unless they still support Herman Cain. It’s such a poorly designed test that it says something about the person offering it.

                Now, it’s possible you weren’t actually aware of this. Though I’ve gotta say you could get a heck of a lot of miles out of feigning ignorance. Unbecoming as that may be.

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                • Uh, I think it’s Austrian economics and the basic libertarian principles Rothbard supported, not Rothbard personally, that make up the criteria, so the Herman Cain example is ridiculous. He was using Rothbard as an example of someone who maintained the principles, not as the Libertarian God to be worshipped. Come on, Jason, you are stretching now, and looking foolish.

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                  • One of the main points was that Johnson was practically ignorant regarding Rothbard and was stumped by questions regarding libertarianism that a libertarian should have answers to, even if the answers are he believes in a different kind of libertarianism and Rothbard is not all that.

                    It’s really hard to take someone seriously who calls himself a libertarian yet knows very little about libertarianism. Johnson has disappointed a lot of people who thought he was the real deal. I have to say, Jason, you have disappointed me –your defense of Johnson is very weak and lacks credibility.

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          • Yes, Bob Barr was terrible. So is Johnson. The others, Romney and Obama, and Bush before, were so awful that Johnson looks good, but to a principled libertarian like myself, Johnson is a fraud. He would go along with the status quo and not make waves for fear of not being re-elected. He would tell those who voted to get him in that he has to compromise to govern, but the result would be more government spending, higher deficits, a larger military, the drug war still in place, the Fed untouched, and the welfare state even more bloated and dysfunctional. Johnson is a pragmatist, and the pragmatic thing to do in the middle of Government power as the highest government official is to protect power. Only a principled fighter would reject power that is not appropriate to government.

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            • I’m sorry ma’am, but there’s nothing we can do. His 3rd Partyitis has advanced to stage 4 and is inoperable. I give him 300 years on the inside before he’ll be happy with a candidate. Until then, we can only try to keep him comfortable.

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              • We don’t need another political party — we need a private sector revolution. We were told it’s our duty to throw off any government that is violating the basics of the Constitution, the rights described in the Declaration of Independence.

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        • You asked: tell us why we should vote for Obama and not Romney. I answered. I’m getting tired of your fact-free roaring and blustering about Mean and Dishonest. Congress hasn’t exactly cooperated with any of Obama’s initiatives. Politics is a contact sport and it’s high time the GOP got a bloody nose for its track record of intransigence. The PACs are handing Romney his hat with ads like these.

          As for defending the truth, well, don’t be annoyed. Just defend it.

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          • What’s truth got to do with it, Blaise? The ad’s a lie.

            WOLF BLITZER, CNN: “Meanwhile a new attack ad by a Super PAC backing President Obama basically blames Mitt Romney for a woman’s death from cancer after his company, Bain Capital, shut down the steel mill where the woman’s husband worked. Let’s go to our White House correspondent Brianna Keilar, she’s watching this for us. Brianna, on the surface it seems pretty outrageous to blame Mitt Romney for the death of this woman. That’s a pretty outrageous claim. But what’s going on here?”

            BRIANNA KEILAR, CNN: “It does when you dig deeper here, Wolf, because this ad makes it sound like this woman passed away shortly after Bain Capital closed down the steel plant where her husband worked. But in reality she passed away five years after it closed. And the former steel worker in this ad, I spoke to him on the phone today and he said that during some of that time his wife had insurance through her employer. So, Wolf, this is a heart-wrenching story, but it’s not accurate.

            KEILAR VOICEOVER: “Joe Soptic worked at GST Steel in Missouri for almost 30 years. He was laid off after Bain Capital acquired the plant, eventually closing it down. Now Soptic is featured in a new ad by Priorities USA Action, the Super PAC supporting President Obama’s re-election.”

            PRIORITIES USA AD: “When Mitt Romney and Bain closed the plant, I lost my health care, and my family lost their health care. And a short time after that my wife became ill. And then I took her up to the Jackson County hospital and admitted her for pneumonia, and that’s when they found the cancer. By then it was Stage 4. There was nothing they could do for her.”

            KEILAR: “It’s a heartbreaking story, but the ad does not tell all of it. In 1999 Mitt Romney leaves Bain for the Salt Lake Olympics, stopping day-to-day oversight of the company but remaining CEO. In 2001, Joe Soptic loses his job when Bain closes the plant. His wife still has insurance, though, through her employer, Saver’s thrift store. A year later, Romney formally leaves Bain. And it’s that year, 2002, or perhaps 2003, Soptic tells CNN, that his wife leaves her job because of an injury. That’s when she became uninsured without fallback insurance from her husband. A few years later, in 2006, she goes to the hospital is diagnosed with cancer and dies just days later. Soptic, an Obama supporter who was in another ad back in May for the Obama campaign, blames Romney for the loss of his job and his insurance.”

            JOE SOPTIC: “That’s the way that I feel. I mean, Mitt Romney, he’s a very rich man. I mean it’s obvious if you watch him on television that he’s completely out of touch with the average family, or, you know, middle income people. I don’t think he has any concept as to how when you close a big company like that how it affects families, the community. You know, it affects everyone.”

            KEILAR: “The Romney campaign is blasting the ad. A spokeswoman saying President Obama’s allies continue to use discredited and dishonest attacks in a contemptible effort to conceal the administration’s deplorable economic record. The Obama campaign and the White House are keeping their distance from the debate. White House press secretary Jay Carney said he has yet to see the ad.”

            JAY CARNEY, WHITE HOUSE: “I’m simply saying I have not seen this. So how could I possibly assess it without–”

            KEILAR: “Will you assess it later?”

            CARNEY: “If you ask me tomorrow, sure.”

            KEILAR: “Now, Wolf, I followed up with Carney after the briefing and he told me that he may look at the ad but if I ask about it, ‘my assessment will be I have no assessment.’ This is kind of a case of the Super PAC being able to do the dirty work and the campaign and candidate, and in this case, the White House, trying to keep its hands clean.”

            BLITZER: “All right, so the White House at least now not touching this commercial. The Obama campaign I take it isn’t saying anything about it either, is that right? What about the Super PAC itself? What are they saying?”

            KEILAR: “That’s right. Everything is being referred to the Super PAC. I spoke with Bill Burton, a founder of Priorities USA Action. And I pressed him on this, are you drawing this link between Mitt Romney and this woman’s death? And he said, no, we’re not doing that. But Wolf, I think a lot of people who looked at that ad, certainly you, certainly I, did not walk away from it with that impression.”

            BLITZER: “We’ll talk about this ad in our next hour as well. We have a representative from the Obama campaign, a representative from the Romney campaign. They’ll be on together, and we’ll go through this point by point by point. Excellent report, Brianna, I really appreciate the good work. Thanks so much.”

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              • It says a lot about Obama supporters that even the MSM don’t want to be slimed by their antics. The Obama hitmen like Burton and Gibbs are sleazebags too low even for CNN, which out of all the media sources tries to be fair most of the time. MSNBC will likely not understand the problem.

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                • I’m not sure what you’re arguing here Mike. But regarding this quote:

                  KEILAR: “Now, Wolf, I followed up with Carney after the briefing and he told me that he may look at the ad but if I ask about it, ‘my assessment will be I have no assessment.’ This is kind of a case of the Super PAC being able to do the dirty work and the campaign and candidate, and in this case, the White House, trying to keep its hands clean.”

                  I don’t think your argument, or Tom’s for that matter, goes thru. By law, the candidate and the PAC can’t communicate or coordinate on messaging. So – by law! – Carney is prevented from expressing an opinion about the content of a PACs advertisement.

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            • A lie? What did I say about propaganda? It’s a snowball thrown at someone’s head, with a factual rock at its core. This story wouldn’t be possible if we had health care for everyone. It doesn’t matter if it was five years or five minutes, Bain took a working steel mill and butchered it like a beefer. For the money. And if this Joe Soptic character lost his job and his insurance and his wife died of cancer, aren’t you glad Obama got some health care legislation passed?

              Oh, I guess you’re not going that far, are you. One thing’s for sure, Romney can dish it out. But when Joe Soptic’s sad little story gets on the air, the Republican squeal like stuck hogs and start in with the “Lies! Lies!” refrain. A bunch of catamitic pansies, the whole lot of them.

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              • Bain took a working steel mill and butchered it like a beefer. For the money

                That’s false. Bain bought a failing steel mill at a time when lots of steel mills in the U.S. were failing due to international competition they weren’t prepared to face. The owners didn’t have the capital to modernize their mill, so they had to sell or close. Bain bought it and returned it to profitability….for a while. Then another wave of international competition hit (remember Bush’s steel tariffs, to try to protect U.S. steel firms?), and the mill lost money again. Then there was a strike and an inability o come to agreement on wage concessions, which ultimately resulted in the mill’s closure. Take your pick of who’s the bad guy there, as it really doesn’t matter, because at that point it’s just a typical labor v. capital story. Maybe it’s the unions fault (as the WSJ predictably claims), or maybe it was greed and poor management on Bain’s part.

                But to say Bain simply butchered the steel firm is to ignore the fact that it bought a plant that was on the verge of being shuttered (with all those jobs being lost then, rather than later), returned it to profitability, at least for a while, rather than just selling off the parts, and ran it until it became unprofitable and entered bankruptcy. They invested in the firm, they didn’t just strip it of value.

                The first casualty of politics is truth.

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                • It isn’t false. That’s exactly what happened. Lots of steel mills did just fine. Riddle me this: take out every other consideration: Bain paid itself 4.5 million for “consulting fees”. What benefit came of that consulting? If I went into some outfit and charged them 4.5 million in consulting fees and they went bankrupt anyway, especially after someone else made an offer to buy the place and save it, I think I would try to keep that gig off my resume.

                  Don’t wave your hands and tell me about international competition. I face international competition too. I have to sell a better product. Mitt Romney’s running for President of the United States of America. We face competition as a country and Romney’s track record just might work against him if his track record at Bain is any guide to his thinking.

                  Verge of being shuttered, my ass. Bain saddled that company up with debt, paid itself an obscene fraction of it and let it die. And that’s what he’d do for America too.

                  The first casualty of politics is not the truth. It’s a person’s conscience.

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                    • Sorry couldn’t get back to this site yesterday (or most of today) but your number is still wrong. Your own source indicates at least 25Mil invested by Bain.

                      In both 1996 and 1997 GS had billion dollar revenues. They didn’t finish paying off their debt, but the investors received a goodly portion of it and interest, and let’s not forget the debt was for the purpose of modernizing a century old obsolete plant. Let’s compare that to Solyndra, whoops better not.

                      Bain essentially did a reverse IPO with the financing and collected the proceeds just like Goldman Sachs would have done. How many other companies have done that? How many have used PIPE financing and how much did it cost them? How many airlines, and how many of them have gone through not one but multiple bankruptcies? The plant was PROFITABLE in 2007 until the assholes running the union decided to start a fight. Well they won if by won we understand it to mean they destroyed YET ANOTHER company. You still believe in the unions of 1890 a long-dead dream. The reality in this country is unions belong to organized crime. Or do you seriously believe Jimmy Hoffa was the LAST union leader with ties to the mafia?

                      But you’re blithely ignoring the simpler and far larger point. GS Steel would have been GONE in 1993, not 2001 had it not been for Bain. Therefore that schmoe would have been without health insurance 13 years before his wife died instead of only 5.

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                    • Well, Ward, here’s where we agree: everyone was doing it at the time. It led to the destruction of many good companies to the vast enrichment of Bain and its investors. I respect you too much to argue with you about it. Let’s just agree Bain and the Bain-appointed executives didn’t save GST but they made a big pile of money from the deal.

                      Maybe it was inevitable. Hard to prove a negative, either way. GST is gone. A lot of people lost money on that deal but Bain made a lot of money. Morality doesn’t enter into this equation: capitalism, as I’ve said too often, is amoral, not immoral.

                      But it does seem fair to say Bain didn’t save GST. It also seems fair to observe GST and many other American steel firms died because China was dumping steel and the US government did nothing to stop it. GST was not Bain’s finest hour. It also seems fair to infer Mitt Romney would not protect American jobs and businesses as president, for the very reasons you lay out: GST would have been gone, entirely, un-mourned and un-missed.

                      You’re a capitalist. I’m a capitalist. It’s the only scheme for general prosperity via job creation known to man. China doesn’t play by the rules. I want a President of the United States of America, someone who will stand up for the American worker. Damn the unions if you want, nobody else is standing up for the American worker. Our jobs disappear and all the GOP can say is “that’s business”. And damn the unions.

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                  • Sometimes, Blaise, you are so ridiculous as to be beyond parody. Because you face international competition you understand international competition in the steel industry? You, a guy who boasts about being able to move all your capital in a pickup truck, are comparable to a company that requires physical capital costing hundreds of millions of dollars?

                    Of course some steel firms handled the competition. Some, like Nucor, had already moved away from the old technologies , operating efficient mini-mills instead of the old open-hearth furnaces. And at least one very profitable steel company, Steel Dynamics, was another Bain investment–why didn’t they “butcher” that one?

                    And anyone who thinks that international competition didn’t hit a lot of American steel firms hard in the Kate 90s/early 2000s, just dien’t know the facts. Bain can be criticized for not having put the firm in a good position to handle that competition, sure, but to poo poo the real effect of it is to announce one’s desire to reside in the land of myth.

                    And you’re going to make a big deal out of 4.5 million in consulting fees when Bain invested 100 million in upgrading the company, and returned it-albeit only temporarily-to profitability? You’re talking drops in the the bucket.

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                    • When the last few stanzas of the thread resolve to a personal attack on me, I know I’ve won.

                      Let’s say you’re right, everything. I’ll even throw in the factoid that China was dumping steel and American government did nothing about it and it damned near wrecked the American steel industry, where it wasn’t just melting down old cars and turning out sheet steel.

                      How does this change the fundamentals of what I’m saying? Where are you getting this nonsense about 100 million? Bain didn’t raise that money, it issued GS corporate bonds. And it took a good deal of that borrowed money and stuffed it into its pockets, went bankrupt and left the bondholders out in the cold. Ha ha.

                      Please. Keep a civil tongue in your head. I don’t carry around stock certificates and I trade through TradeStation. I do keep a few titles to property in a safety deposit box. All my worldly goods fit into a truck, that’s true. More accounting for you: Assets equal Liabilities plus Capital. The name of the game is Equity, James. Not Assets.

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                    • Blaise,

                      My point was that being able to respond to competition is very different when your capital costs are low than when they’re very high. For you to respond to competition you don’t need to find many tens of millions of dollars lying around somewhere to totally refit your physical plant. You’re not comparable to a steel mill, because you’re primarily labor-intensive while they’re vastly capital intensive. Sorry, but comparing yourself to a steel mill is ridiculous, no matter how much you want to pretend my saying so loses the argument.

                      As to Bain floating a bond (normal business practice–why shoulder all the risk when others are willing to bear portions of it), and directing some of the bond money their way, that’s all beside the point of where I’m critiquing you. I’m responding to your argument that Bain just carved up the company, cannibalizing it to make a quick profit. The fact that they floated a bond to invest in the company (the $100 million isn’t nonsense; it was invested in the company, regardless of how it was raised), rather than just selling off all the assets, and the fact that they continued to run the company, even returning it to profitability for a while, that they tried to continue running it when they began losing money again, until they gave up and put it in bankruptcy, demonstrates that they weren’t just carving it up.

                      I’m not saying they managed it well, and I’m not making any brief for Bain. Maybe they’ve carved up lots of companies for a quick buck. But the evidence is that contra your claim, in this case they didn’t do that.

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                    • These kind of LBO’s need to be outlawed. They aren’t standard practice. They are clearly exploitative amd immoral -even if they are hard to make illegal. They likely hurt the economy (unlike a lot of honest venture capital deals) and certainly hurt individual workers. Loading up a succesful company with debt and then shuttling money to Bain through fees and dividends, raiding its pension, manipulating tax code through taking on debt. These are crooked practices, especially when done in conjunction. If Americans understood this, it would be illegal, and we would be better off.

                      Here’s Delong:

                      “But what is good for Bain Capital is definitely not good for America.

                      What is good for Bain Capital is definitely not good for America because Bain Capital is in the business of making it more difficult for businesses to commit to long-term labor policies via Shleifer-Summers breach of trust, increasing oligopoly via abuse of bankruptcy, expropriating workers’ pensions share of equity and loading costs onto the PBGC, creating lots of very risky debt that is then sold to and held by investors who really should not be running such risks, etc. And if it replaces some less-than-competent managers by more competent ones in the process, that is a small source of Bain Capital’s profits.

                      The Bain Capital-style LBO part of Private Equity has been, I think, on balance a trainwreck over the past three decades.”

                      http://delong.typepad.com/sdj/2012/07/adam-ozimek-gives-three-cheers-for-outsourcing-i-give-minus-three-cheers-for-bain-capital-style-lbos.html?cid=6a00e551f0800388340177435caac5970d

                      Read the Delong piece and tell me what he gets wrong. If not, you need to change your tune on Bain.

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                    • Comparing myself to a steel mill? Your argument was as follows:

                      That’s false. Bain bought a failing steel mill at a time when lots of steel mills in the U.S. were failing due to international competition they weren’t prepared to face.

                      I do face international competition. See, here’s some basic economics, steel companies don’t compete with software companies. Only software companies compete against software companies. I’m not labour-intensive. People don’t pay me to do things, they pay me to know things, to have project management experience. They pay me for the scars on my ass. I’m never done paying my dues, I’m constantly having to stay current, I can never get out from under code. I can’t compete with these Indian jamokes on price so I employ kids out of the community college down the way as a force multiplier. Not only do I face international competition, I understand how to create and leverage American talent. You be nice now. You don’t have any idea of the problems I face as a consultant or how I compete or even whom I’m competing with. Hell, I hardly know, it’s changing all the time.

                      You said Bain invested 100 million. It borrowed that money. So much for that specious bit of tripe. Fairly common? Yes, it is. The Wimpy Way to Wealth: I will gladly pay you Tuesday for a Hamburger today. I’ve said Romney and Bain were no different than their competitors who were doing the exact same thing, treating corporations like cattle led to slaughter.

                      You might not be writing a brief for Bain. That’s wise. But when it comes to Consulting Fees, James, that’s what puts food in my fridge.

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                    • Kris,

                      I’m not making a generalized argument about LBOs. I’m rebutting the claim that all Bain did was cut this company up to sell off the pieces for profit. As I said above, perhaps they do that frequently. But the evidence shows that in this case they did not. They tried to run the company profitably, and did for a while.

                      They did not in this case “load up a successful company with debt.” They took an unsuccessful company, one that lost over half a billion dollars in ’93. And they didn’t simply load it up with debt–the company had to have serious capital reinvestment if it was going to have any chance of becoming successful again; companies load themselves up with debt all the time in order to get the funds for capital investments, and a lot of American steel mills in the ’80s and ’90s were in the same bind; operating with 19th century technology that was inefficient, needing badly to upgrade, but because of the equipment they were using not being competitive enough to have the finances to upgrade.

                      The focus of my comment was not on Bain’s practices in general, whatever they may be, but on the question of whether Bain simply cannibalized this company or tried to successfully run it. The evidence shows they tried to successfully run it. That they ultimately failed is certainly not to their credit, but that doesn’t mean they didn’t try.

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                    • James, just stop while you’re ahead. You’ve already said GST sold a bunch of corporate paper. We’ve already established Bain pocketed a substantial fraction of that sale and paid itself what by any measure were grossly excessive consulting fees.

                      And when GST went bankrupt, what do you think happened to all those bondholders? Hmm?

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                    • You said Bain invested 100 million. It borrowed that money. So much for that specious bit of tripe.

                      How does borrowing the money make it either specious or tripe? The business could not have survived without the investment in upgraded capital equipment. Whether the money is borrowed or comes straight from Bain’s coffers doesn’t matter to that critical issue. I don’t get why you think that’s a big deal.

                      Even a company that is a consistent top performer, like G.E., borrows money by issuing bonds.

                      There’s no story there.

                      As to the rest of your comment, you seem to think I argued that you didn’t face competition, or that you don’t compete well. Of course I said neither. I only said that responding to increased competition is different in labor-intensive and in capital-intensive industries. I said that as a labor-intensive business you don’t need to access tens of millions of dollars in cash to upgrade your physical plant. That’s all. Whatever you are responding to there in your self-description, it is not anything I actually claimed. I don’t doubt you face competition, I don’t doubt you have to work your ass off to be successful in the face of that competition, and I don’t have any reason to doubt that you have been successful. I only think that you are unlikely to ever find yourself in the position of needing many tens of millions of dollars in physical plant improvements, as many American steel firms did in the ’80s or ’90s.

                      Fairly common? Yes, it is. The Wimpy Way to Wealth: I will gladly pay you Tuesday for a Hamburger today. I’ve said Romney and Bain were no different than their competitors who were doing the exact same thing, treating corporations like cattle led to slaughter.

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                    • You’ve already said GST sold a bunch of corporate paper. We’ve already established Bain pocketed a substantial fraction of that sale and paid itself what by any measure were grossly excessive consulting fees.

                      Yes, none of that’s in dispute. What’s in dispute is whether Bain used those instruments simply to butcher GST, or whether they used them to try to run it profitably. The evidence says they tried to run it (but failed). You’ve established nothing different; instead, your argument depends on the assumption that offering bonds and taking some of the money necessarily equals butchering a company; an assumption that flies in the face of the evidence that large capital-intensive American businesses that have been in business almost forever and are still going strong also offer bonds.

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                    • C’mon. We know GST was in trouble. No dispute there. We seem to agree GST sold paper, ostensibly to get out of trouble. So far, so good.

                      If Bain, knowing the state of affairs with GST was so bad, and again, I’ve stipulated to anything you’re likely to say about how bad things were or how much they needed to overhaul their operation — why, for godsakes, did Bain take tens of millions out of the operation at that point, straight out of all that borrowed money.

                      Now I say they were butchering GST. You think they weren’t. You think they were trying to save GST. But Bain’s premature and excessive draw against GST’s cash on hand supports my position, not yours. You need to ‘splain why it was such a good idea to take money which might have been put into the operation and put it in their own pockets. And you still haven’t addressed the consulting fees issue.

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                    • James,

                      I am glad that you think you shouldn’t defend what Delong calls a “Bain-style LBO.” They are indefensible. They bend the rules on bankruptcy, debt, and taxation to drain money out of companies that could be and often are succesful otherwise. They are bad for America and I am glad you don’t contest that.

                      The GST deal is clearly an instance of Bain acting so as to make this company less likely to succeed. Bain’s intentions and hopes for the company are unknowable and irrelevant, (Even conservatives like Gingrich and The Texas Oops argued this was a crooked deal. Even Romney admits it implicitly by arguing he wasn’t in on this deal, not that he approves of the deal.) This LBO loaded up GST with debt that they then used to operate the company while paying ridiculous dividends and fees to Bain. (And the debt allowed them to benefit under the tax code, robbing taxpayers.) Some of the debt may have been used to benefit the company other ways, but that doesn’t make the vampirism aspect of the rest of the debt any better.

                      Had the company not paid those fees and dividends, ultimately by taking on debt, the company would’ve been better financed to pay its debts going forward. Once a company like GST is loaded with that debt -a large part of which is just siphoned off as payments to Bain- it can’t survive shocks the way it would if it was less indebted.

                      But the bankruptcy just allows you to kill pensions and cut benefits. Bain doesn’t lose with this bankruptcy, so they didn’t act strongly enough to avoid it. There’s no evidence that this bankruptcy was intentional, but Bain loaded the company with debt, knowing that if the company suffered with the new debt payments, it could benefit from the bad situation by using bankruptcy to sluff benefits. The bankruptcy was one option that Bain was fine with. That’s how “Bain-style” LBO’s work. A succesful company or a loser is drained of its cash.

                      Sure, Bain wanted the company to succeed. But the problem with LBO’s is that they’re set up so companies can draw money out even when the company fails and in many cases they make failure more likely.

                      Yay less regulated capitalism!

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                    • Blaise–No, I don’t need to explain why it was a good idea, because I don’t know that it was. But I will say this–GST was profitable despite Bain drawing that money. That’s the little nugget you keep overlooking; that despite Bain’s take from the corporate offering, GST still returned to profitability. Had the market remained untroubled, there’s no evidence the money Bain took would have hindered GST’s profitability.

                      Of course the market didn’t remain untroubled. What killed GST was the renewed influx of cheap imported steel,*and their inability to respond effectively to it.** My guess–and it’s just a guess–is they actually needed even more physical plant modernization than they got; that it appeared for a while they had done enough, so Bain left it at that, then got caught with their pants down. The recalcitrant union that refused wage concessions didn’t help, but my general belief is that a well run business will never be bankrupted by a “bad” union, and that a bad union in itself is a signal that a company isn’t well-managed.

                      But the fact that GST was negotiating with the union as it was heading into trouble is itself a signal that they were trying–however ham-handedly–to make the company keep running. The fact that they ultimately failed does not prove intent–that’s just a post hoc ergo propter hoc argument.

                      GST reportedly lost $53 million in 1999. Had it continued to lose at that rate, it would have burned through Bain’s take from the bond issue in less than 3 years. That might have been enough to keep it solvent–obviously it would have helped–but it might not have. None of us here have enough information to give a definitive answer to that.

                      Again, I’m not saying Bain managed the company well. In fact I think the evidence shows they didn’t. But they did manage it, rather than just cannibalize it.

                      *Which wasn’t actually “dumping,” per se. It was more like a fire sale because China outproduced what the market could bear, and obviously the market had to correct, and the Chinese had to cut their losses–better to sell their surplus cheap than not sell it. I see the same thing all the time at K Mart.

                      **A lot of steel companies hadn’t positioned themselves to face that competition; primarily the older ones. The newer firms were mostly running mini-mills and were efficient enough, and in many cases, producing high quality steel or specialized products, that they weren’t so heavily affected by it. But the struggling steel firms were the ones that asked Bush for the temporary tariffs (which by all accounts I’ve seen, cost more jobs in steel-using industries than were saved in steel-producing industries, by pushing the price of steel up), and from what I’ve read, Bain, or at least GST, was one of the companies begging for the tariffs.

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                    • Kris,

                      For the umpteenth time, I’m not saying Bain managed GST well. Can we please get past the little red herring? I’m saying Bain didn’t just cannibalize GST, as was claimed by the other commenter.

                      And you’re presenting DeLong as though he’s a counter to my argument, when he isn’t because he and I are addressing different questions.

                      I don’t mind discussing the issue, but I do get a bit irritated at being badgered about a claim I haven’t made.

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                    • Bain: “We buy sinking ships and try to save them. But we don’t go down with them.”

                      Just like bankruptcy lawyers don’t work for free, Bain paid itself while trying to refloat business that were going under. This is good business, smart business, and the only method that assures that one day you’re not sucked under yourself.

                      Further, their success rate was very good, saving quite a number of failing businesses.

                      http://www.factcheck.org/2012/05/lemon-picking-bain-capital-obama-style/

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                    • Huh, I never even looked at that Factcheck article, but it essentially agrees with everything I said.

                      And Tom and I are in agreement yet again, which isn’t as rare as folks might think, but certainly not a monthly event.

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                    • That factcheck article is damning of Bain, Tom. Did you read it?

                      It states that Bain made some good, fair deals (no one disagrees) but this deal stank. (As Delong, Krugman, Gingrich, and many others agree.)

                      It agrees that steel companies like GS may have gone bankrupt regardless of debt. (An unknowable counterfactual.) But it states that Bain loaded GS with debt and only some of that debt went to helping the company. It asserts that Bain did drain a lot of money (which came from the debt GS took on) from GS making GS’s fiscal situation much worse. It asserts that the extra debt that Bain dropped on the company was one of the causes of the bankruptcy and made the bankruptcy more likely.

                      That is “cannibalizing” a company. Maybe you have a different definition of cannibilizing or some hair to split about how Blaise formulated his comments.

                      But that doesn’t change the fact that this was a crooked business deal that manipulated the rules involving debt, bankruptcy, and pensions to fill Romney’s pockets. It hurt Americans and didn’t help the economy -like some legitimate private equity deals do- at all.

                      That’s Romney. Bending the rules to fill his pockets, hurting the middle class with financial games that don’t improve the economy. (Sound familiar?)

                      Oh, but he makes many fair business deals, too, to go along with his crooked deals, as Tom points out.

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                    • Kris, exploiting that man’s grief over his wife is contemptible. As for the legitimate questions on the business, I have nothing to add to what Dr. Hanley has written so far or to what I just wrote:

                      Bain: “We buy sinking ships and try to save them. But we don’t go down with them.”

                      Just like bankruptcy lawyers don’t work for free, Bain paid itself while trying to refloat business that were going under. This is good business, smart business, and the only method that assures that one day you’re not sucked under yourself.

                      I think this country needs this sort of competence badly. Whether it translates into votes, I cannot say.

                      “By a stunning margin of 63 to 29, respondents believed that Romney’s past as a businessman would lead to better decisions. Even 34 percent of Democrats saw his career in the private sector as an advantage. They also gave Romney a 19-point advantage in dealing with the federal budget deficit, a 10-point margin in general handling of the economy, and a 5-point edge in having the characteristics to “get things done.”

                      http://www.thedailybeast.com/articles/2012/08/07/obama-s-much-touted-likeability-edge-may-evaporate-before-november.html

                      As to the innuendo—stated quite openly by several here—that Mitt Romney the human being is uncaring, it’s all grist for the mill. As the actual details of Romney’s life come out, this will be shown to be as a libel as well.

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                    • Bain is a tricky group of pirates who steer a merchant ship into the dangerous shortcut of iceberg alley in hopes of getting to its destination faster to make more money. (It might work.) When the ship gets hit by an iceberg, Bain doesn’t wake the crewmembers. Meanwhile, Bain has taken out life insurance on the crewmembers. When the ship gets hit by an iceberg in the middle of the night, Bain doesn’t wake the crew. Rather, Bain steals their wallets and escapes on a raft. Some of the crew survive, but 750 die. Bain Plunders a fortune from the wallets and insurance policies. As much as they would’ve had their dangerous trip succeeded.

                      When the families of the dead crew make ads saying the head of Bain, the man who set the plan in motion, shouldn’t be King, Tom laughs and does a google search to show that Bain isn’t all bad. Sometimes the Bain pirates sail the ship reasonably. They don’t always abandon the crew.

                      But yes, like Schettino, they never go down with the ship. (Good virtue for a president, yes?)

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                    • Kris, you can argue the hard-headed business stuff or the touchy-feely stuff. But this mix of Bain should have gone down with a doomed steel mill to save some guy’s health insurance is neither fish nor foul, nor reality.

                      I’m satisfied that Bain found it more profitable to save a company than gut it, so that “vulture capitalism” riff is crap.

                      And the poor woman dies years after Romney left, years after Bain closed the mill, had her own health insurance in the interim before her death. The charge is nonsense.

                      Mitt Romney’s a good man, and Bain saved a lot of sinking ships. Just what we need in a president just now. In my opinion, of course.

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                    • But they did gut it.

                      They didn’t just not go down with the ship, like Schettino.

                      They knowingly steered the ship dangerously, making it more likely to go down, all the while knowing that they could make money on it going down. (By manipulating bankruptcy rules, tax and debt law, and looting pensions.)

                      That’s not virtuous character that you expect in a president. And its a business practice that is bad for the economy and workers. This reckless and rule-bending LBO might not have directly killed this lady (and the ad did not say nor imply that it did kill her) but it hurt people like the worker in the ad by, for example, dropping his benefits and health insurance when his wife was deathly ill.

                      President Gecko? President Schettino? President Romney?

                      All showing the same character flaw. Caring for themselves and not the ship.

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                    • “Mitt Romney’s a good man…”

                      That is the crux of this entire argument. Again, no one is arguing, implicitly or explicitly, that Romney had anything to do with this woman’s death. Only that Romney didn’t care about the human costs of the business decisions he made.

                      Here is how I see it…

                      I could never do what Romney did as CEO of Bain. Or what others like him do. Which is not to say it is a bad thing to do. We need CEOs. We need folks who can make the hard decisions. Those are important decisions and we need folks who have the right skill set to make them. I won’t pretend to know exactly how or why, but I’m more than comfortable saying men like Romney are important cogs of our economic machine, warts and all. I couldn’t do it nearly as effectively and we’d likely be worse off if folks like me had positions like Romney.

                      But the question is… does that skill set… does what made him good at doing what he did at Bain capital… translate to being an effective President? The country is not a company. It is not a ship you can abandon when it starts to sink. It is a ship you absolutely must go down with if it does indeed sink with you at the helm. Is Romney prepared to do that? It is a position where you must put the interests of others before your own. Is Romney prepared to do that? I don’t know. Part of what made him good at Bain is his ability to be cut-throat and self-serving.

                      Perhaps Romney does have the skills necessary to be President. I don’t know. Why don’t I know? Because we know so little about Romney. He doesn’t want to talk about his time a Governor, which might very well point to his ability to lead, because it alienates his base. He did but now doesn’t want to talk about his time at Bain, which ultimately doesn’t matter because Bain is an apple and the Presidency is an orange. It is entirely possible that Romney would make a great President. It is the opinion of the man in this commercial that he would not. Maybe that guy’s right, maybe he’s not. If you have reason to believe he would be, let’s hear it. And I don’t want to hear why he’s better than Barack “Stinks on Ice” Obama. I want to hear why he’d be GOOD at the job.

                      Running for President is a giant job interview… and Romney is refusing to hand over his resume and keeps telling us about unrelated work history.

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                    • Kris,

                      I’m really having trouble seeing how taking a company that’s on its death bed and returning it to profitability before having it fail during another round of tough competition counts as “gutting” the corporation.

                      I agree Bain didn’t manage the company well. But I can’t see the “gutting” claim as being an accurate representation of what happened. When a firm like Bain “guts” a company, they usually break it up and sell it off quickly. In the case of this firm, they revitalized it, even taking another steel mill they bought and joining it with this one, rather than splitting things apart.

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                    • Tom,

                      “The rest” is disagreement. Profound, sincere, fundamental disagreement, much deeper than simple disagreement about political policies/parties/candidates. It’s a disagreement about the very nature of decency.

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                    • James,

                      This is gutting. All from that factcheck article:

                      “Bain made money on the GS Industries deal even though the company went bankrupt. Under Bain’s leadership, the company took on massive debt. Much of the debt was taken on to make much-needed updates to aging equipment, but some of it was also used to enrich Bain and its investors. Some analysts say the company’s large debt was a key contributor to the company’s fall. Adding to the employees’ woes, the company announced at the bankruptcy that it could not honor commitments it had made regarding pension and other benefits. So there’s no getting around that this was not Bain’s finest hour.”

                      Maybe some analysts (maybe you) disagree and say it was on its way down anyway. That’s an unknowable counterfactual. But Bain clearly knew they could make money by loading the company with debt, much of which they just sucked up as Bain profits, regardless of whether the company fell. And that debt made the company more likely to fail. Which it did. And then they reneged on pensions. (I guess not all contracts are sacred. Not when Bain run companies have contracts with workers.)

                      That’s wrong. Its gutting a company.

                      Let me ask you. What would gutting a company look like, if it didn’t look like this?

                      Here’s a somewhat tangential question: Do you think Bain should be on the hook for pension obligations that GS defaulted on while Bain owned GS? (Obviously they aren’t on the hook. The question is whether they should be.) Also, do you agree that there should be tax incentives for companies like Bain to load GS with debt that they then funnel to Bain as dividends?

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                    • James Hanley, I leave this thread all to you; you’ve offered principled rebuttal to the ad. Me, I popped Wolf Blitzer in a zillion comments ago and nothing has laid a glove on it.

                      I feel bad for Joe Soptic losing his wife to cancer. If Bain Capital had never existed, the mill still would have closed and she still would have died. that’s the reality.

                      I don’t know if Joe Soptic is overcome with grief and anger or is just another opportunist like Cindy Sheehan, whether he’s being used or permitting himself to be used. But he has no enhanced “moral authority” because of this tragedy, a tragedy that had absolutely nothing to do with Mitt Romney.

                      I hope the American people are disgusted by this ad and this charade. I also find Candidate Obama complicit in this exploitation of the Soptics’ tragedy if he does nothing to signal that this has crossed the line.

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                    • Kris,

                      I hope this doesn’t get ugly, but I am truly boggled.

                      The FactCheck article clearly says GST needed the investment, and Bain made the investment happen, the initial $100 million from the bonds and later an additional 16.5 million. That’s adding to, not taking from (which is what I see “gutting” as being”).

                      As to the “counterfactual” of the company dying without Bain, it’s not that hard to establish as the most likely outcome. First, steel firms were dying left and right back then, and we know the reason why–they had 19th century technology that was obsolete and more efficient firms were out-competing them, leaving them without the resources to modernize. GST was just another run-of-the-mill mill, no different from those others. According to the FactCheck article it had dwindled from something 4500 employees to only 1500. Elsewhere it’s reported that the firm lost over half a billion dollars in a single year. It’s impossible to dispute that it was a firm in decline. Second, the former owners said that it was either sell or close down, and fortunately for them they found a buyer.

                      So you have a firm in decline, and when Bain bought it, they did not sell off the pieces, but put money into it. Mostly other people’s money, yes, but that’s still putting into the company, not taking out from it. The millions Bain took from the bond issue? That’s money GST would never had had anyway, because the former owners weren’t going to float a bond (they described their choices as close or sell, for them, only those two). Would GST have been better off with that money? Sure, but it wouldn’t necessarily have been enough to save it in the end anyway, and I reiterate that GST would never have had that money in the absence of Bain anyway.

                      Bain did modernize and return to profitability a firm that was about to go under. How is that gutting?

                      In the end, Bain didn’t manage GST well. When the new wave of cheap imported steel from China hit, they couldn’t adapt, and the firm closed. That’s a business failure, not a gutting. As the FactCheck article notes, “A 2003 report from the U.S. International Trade Commission found that between 1999 and 2003, “31 steel companies producing products subject to the safeguard measures [including tariffs on foreign imports] have filed for bankruptcy protection.” Clearly, a steel mill filing for bankruptcy in the early 2000s is not sufficient evidence of “gutting.” A bundle of them went under because they weren’t well positioned to handle the competition of cheap imports that resulted from an economic decline that diminished demand faster than it diminished output.

                      Much seems to be made of the fact that Bain didn’t lose money on GST’s bankruptcy. That doesn’t actually demonstrate anything except that Bain knew well how to protect itself and push the risks and costs off on others. That’s critiquable–as the FactCheck article says, this wasn’t “Bain’s finest hour.” But nothing in this article, which you claim is “damning,” demonstrates–and the article does not claim–that Bain gutted the company.

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                    • James,

                      This won’t get ugly unless you call me a dick again.

                      The article says they added debt to GS that hurt the company’s finances, and analysts say that helps cause the bankruptcy, while Bain profitted.

                      That’s a crooked LBO as Delong explains.

                      Bain did invest, but they mostly invested debt. Some of that money helped the company, but a lot of the debt was transferred straight to Bain’s profits and fees.

                      I am not in the economic minority in seeing this kind of deal as exploitative, bad for workers, and bad for the economy.

                      Maybe you agree with that. Maybe you don’t.

                      Read Delong and Krugman and you’ll learn more about where I’m coming from than this debate.

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                    • Here’s the crux of the deal for me when it comes to the way Bain does business. We’re always told that the, dare I say it, moral rationale for the outsized earnings, not to mention tax-advantaged status, of the investor class is because of the risk they face? After all, they’re hard-earned lucre could all just go, Poof! into the ether.

                      Well, AFAICT, Bain has figured out how to make what should be a very high-risk type of investing totally risk-free. For Bain, anyway. Actually, what they do is privatize the profits while socializing the risk. It may not be socialized in the sense of the government picking up the tab (although probably to some degree through tax manipulations), but somebody else is always shouldering the risk.

                      Now, maybe this is just an artifact of selection bias, what gets reported and commented upon and what doesn’t. But can anyone give me an example of a deal where Bain actually lost money on a deal? I don’t mean a case where the company being “saved” eventually went under like GST, but a case where Bain Capital itself took a bath?

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                    • James,
                      GE a consistently high performer? is that why the FED needed to stop people from shorting it????

                      I somehow think that a bank issuing bonds is a different matter than a steel plant issuing bonds. Perhaps that’s just me.

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                    • ,

                      The article says they added debt to GS that hurt the company’s finances, and analysts say that helps cause the bankruptcy, while Bain profitted.

                      The debt helped the company initially. That can’t be overstated, but you keep breezing over it. Without that debt the company fails 8 years earlier than it did. And analysts absolutely do not say it “caused” the bankruptcy. That is a very bad misreading. They say it may have “contributed” to the bankruptcy. Absent the unexpected influx of cheap steel caused by a worldwide economic downturn, the company would not have gone bankrupt. At that point the debt did contribute to the company’s problems, certainly. But to say the debt “caused” the bankruptcy is to treat the debt as a variable, when it was actually a constant.

                      Bain did invest, but they mostly invested debt.

                      Again, businesses go into debt for capital investment all the time. That the investment is debt is the kind of thing that sounds spooky and bad, but isn’t necessarily so. As I noted above, you can buy General Electric bonds–does General Electric having debt indicate they’re doing something wrong? Far from it, as it’s a company that has consistently been one of the most profitable firms, decade after decade. The amount of debt a company bears is relevant (but again, GST was bearing the debt well until hit with cheap imports), but the fact that the investment comes from debt is irrelevant.

                      An old and shuttered restaurant in my town was recently renovated and re-opened. Where did the new owners get the money to buy and completely renovate the place? They borrowed it. Taking on debt for capital investment is absolutely necessary for business development.

                      Some of that money helped the company, but a lot of the debt was transferred straight to Bain’s profits and fees.

                      Yes, and perhaps that’s criticizable. On that point I won’t pretend to be an expert, although lots of other people are obviously comfortable doing so. But even if that’s criticizable, it still doesn’t equate to Bain “gutting” the company. Putting $100 million into capital upgrades in a company is not gutting it–that, to me, is the point that keeps getting obscured. If you were gutting a company and intending to close it down, would you put $100 million into modernizing its equipment? Why? It doesn’t make sense.

                      I am not in the economic minority in seeing this kind of deal as exploitative, bad for workers, and bad for the economy.

                      I don’t grasp how keeping a company open 8 years longer than it otherwise would have been was bad for the workers. Your company is about to go under, which means you would lose you job. Someone buys the company and keeps it going another 8 years, meaning you have your job for 8 years more than you would have had. How is that a harm, rather than a benefit?

                      As to DeLong and Krugman, I’m quite familiar with them, and have their pages bookmarked, along with a lot of other econ bloggers. I strongly recommend expanding your econ blog reading beyond just those two, however. Their are many fine economists–including other Nobel Prize winners–who have perspectives that challenge D&K.

                      That said, though, I reiterate that in the link you provided, DeLong was not talking about GST, but about Bain’s general business practices. I’m not talking about their general business practices, but about GST. However normal gutting companies is for Bain, they clearly don’t always gut a company. They sometimes invest for the longer run in a company and try to keep it going. And that’s what they did in this case. I’m only talking about this case. Reference to DeLong is not relevant, because he was not talking about this case.

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                    • Kimmi,

                      Yes G.E. has been a top performer for decades. If you read only the news, you’ll see a single event and take it as representative of a trend. If you actually study an issue, you’ll see that for decades G.E. consistently outperformed the Dow Jones average.

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                    • James,

                      I’m beggining to think you are a little like Megan McCardle, someone who is professionally obtuse. That is, you are using every little niggling, nitpicking point to throw up a sort of wall of smart-sounding distractions that keep you from accepting obvious truths. (Do you or have you worked for a think tank? They seem to encourage that.)

                      1. It’s pretty clear that Delong is thinking or GSI as a “Bain-style” LBO. in his attack on Bain. He doesn’t mention it by name, but in another piece he approvingly cites this attack on The GS deal by Mark Kleiman:

                      “Gardner then explains, using some of those big deals (including Ampad and GS Steel) as examples, how the asset-stripping operation worked… sticking creditors, workers, and sometimes the government with the tab”

                      Delong is attacking Bain in that piece. You are trying to Nitpick and distract.

                      http://delong.typepad.com/sdj/2012/07/mark-kleiman-breach-of-trust-in-bain-capital.html

                      2. We agree that Bain put two kinds of debt on GS: one good and one bad. The good debt went to capital investment and helped the steel company survive a downturn in the market. The bad debt went straight to Bain’s coffers in the forms of dividends.

                      However, you seem to be of the impression that Bain is not to blame for the bad debt because they also brought the good debt. But that’s missing something very basic: GS would’ve taken on the good debt regardless of who owned it.

                      Had they just taken on the good debt, and not dozens of millions or dollars of bad debt, they might have survived. Indeed, their balance sheet might have looked far better and they could’ve been bought by a company that didn’t ravage their pension. Even Anthony Gardner (himself a private equity guy) argues this is what Bain did.

                      And Gardner argues this is how Bain made most of its sucessful deals. It made 70 percent of its profit on 10 deals (out of 67 totalduring romney’s tenure) .

                      3. I recommend reading this article and the book cited. (Not a perfect book, but good.) http://www.rollingstone.com/politics/blogs/national-affairs/why-private-equity-firms-like-bain-really-are-the-worst-of-capitalism-20120523

                      All told, Bain pit 25MM into GS and took 58MM out. Hard to see how that helped them. They could’ve taken on debt to restructure without that.

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                    • 1. But I will say this–GST was profitable despite Bain drawing that money.

                      2. Bain bought a failing steel mill at a time when lots of steel mills in the U.S. were failing due to international competition they weren’t prepared to face.

                      Paint my ass blue and call me Nancy, how anyone can simultaneously hold both positions is a great mystery.

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                    • Kris–Despite your insults, you are the one who is being dishonest. You avoid facts in evidence and make up your own.

                      1. You keep avoiding the fact that GST was essentially a dead company when Bain bought it and returned it to profitability, and that without the influx of low price steel there’s no reason to think it wouldn’t have continued to be profitable.

                      2. All told, Bain pit 25MM into GS and took 58MM out.
                      By focusing just on Bain’s own money, you ignore the $100 million upgrade of GS’s physical plant that Bain engineered. You make it sound like Bain took more money out of GS than it put in, but that’s simply not true because Bain engineered the $100 million investment–that it was not their own money is not relevant compared to the fact that they are the ones who made that investment happen.

                      3. GS would’ve taken on the good debt regardless of who owned it.

                      You call this a fact, but it’s not, and it ignores–as you have repeatedly ignored–a crucial fact in evidence: the former owners of GST said their options were to sell the plant or close it down. So this, “would’ve taken on the good debt regardless of who owned it” is clearly false because those who actually did own it did not consider that one of their options. And think about it–who is more likely to successfully float a big bond, a large capital investment firm like Bain or a small failing firm hardly anyone has heard of?

                      As you have chosen to ignore facts in evidence and just make up your own convenient “facts,” this will be my last word. It’s not possible to have a reasoned debate with someone who plays that game.

                      Blaise–
                      [JH]1. But I will say this–GST was profitable despite Bain drawing that money.
                      2. Bain bought a failing steel mill at a time when lots of steel mills in the U.S. were failing due to international competition they weren’t prepared to face.
                      [BP]Paint my ass blue and call me Nancy, how anyone can simultaneously hold both positions is a great mystery.

                      2 happened before 1. There’s no great mystery about believing a company was failing and then was bought and made profitable again.

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                    • James,

                      I didn’t call you a dick. You called me a dick. I said your arguments and thinking are muddled in a way that losts of think tank, Cato people are muddled. (You went after Blaise pretty ad hominem, BTW. So apologize to him if you think ad hominem attacks are always wrong.)

                      “1. You keep avoiding the fact that GST was essentially a dead company when Bain bought it and returned it to profitability, and that without the influx of low price steel there’s no reason to think it wouldn’t have continued to be profitable.”

                      What Blaise and I are saying is this. The underlying business model of GS was always profitable. This is proven by the fact that after bankruptcy and hell, the company did well.

                      The debt that GS took on to restructure was good debt. An honest manager who cared about the company would’ve added that debt. It wasthe bare minimum anyone would do. So Bain did that.

                      But while doing that, Bain added more debt that they then used to create massive dividends (while the company was struggling.) That’s bad debt. The bad debt made the company more likely to go bankrupt, which it did. The company eventually recovered from bankruptcy, but the bankruptcy hurt workers, pensions, local creditors, and (in a way) the government.

                      Bain could’ve acted to avoid that horrible bankruptcy but they didn’t. They acted for their own profits by adding not just the good debt, but also the bad debt,

                      You seem to think the fact that Bain added the good debt justifies the predatory bad debt that they added. But it doesn’t. A good private equity company would’ve added the good debt and not the bad. That’s why Gardner, a private equity guy himself, thinks this was a horrible crooked business deal.

                      Note that th fact that Bain didn’t rape employees doesn’t justify the bad debt either. The bad debt is what makes this deal crooked. Anything good that Bain did -maybe building a community center or being nice to puppies- is fine, but irrelevant to our dispute.

                      “3. GS would’ve taken on the good debt regardless of who owned it. You call this a fact, but it’s not, and it ignores–as you have repeatedly ignored–a crucial fact in evidence: the former owners of GST said their options were to sell the plant or close it down. So this, “would’ve taken on the good debt regardless of who owned it” is clearly false because those who actually did own it did not consider that one of their options. And think about it–who is more likely to successfully float a big bond, a large capital investment firm like Bain or a small failing firm hardly anyone has heard of?”

                      Th truth is that we don’t know what would’ve happened if Bain hadn’t bought GS and loaded them with bad debt It’s an unkown counterfactual. You seem to agree with this now.

                      But you now agree that Blaise was sort of right. Steel companies were in temporary trouble because of markt conditions around the time Bain brought Bain. But many of these companies, GS included had an underlying business model that could be profitable if the company took on that good debt we’re talking about.

                      I’m suggesting that its possible that a more honest company could’ve and would’ve seen the same thing Bain did, that this company was profitable in the long term, and would’ve and could’ve bought GS, added the good debt, and made it profitable.

                      Can I be sure that would’ve happened? No. But i am sure that Bain could’ve easily tried harder to keep the company from bankruptcy but not adding the predatory bad debt that hurt GS and helped Bain whie GS was struggling.

                      The fact thatthey didn’t try hard enough to help the company, that they ies to raid the company coffers while it was struggling, is what everyone thinks Bain did wrong. Anything else is beside the point.

                      “As you have chosen to ignore facts in evidence and just make up your own convenient “facts,” this will be my last word. It’s not possible to have a reasoned debate with someone who plays that game.”

                      I agree that reasoned debate cannot be had if one larty is not reasonable. The question remains as to who is unreasonable here. I’ll leave it up to anyone still reading (no one, probably) if I am being completely irrational.

                      I’ll add that lots of economists, e.g. Delong and Krugman, and some private equity guys, e.g. Gardner, argue what I am arguing. I have heard defenses of Bain, but your particular line defense is unique to you, as near as I can tell.

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                    • Kris, you still haven’t really addressed this:

                      the former owners of GST said their options were to sell the plant or close it down.

                      If the former owners of GST are saying that their options are A and B, why do you point to C as a likelihood (or rather, uncertain but still likely) but for the actions of Bain?

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                    • Will,

                      I guess the previous owners couldn’t recapitalize the company to see it through its temporary unprofitable phase. Sure. I’m not suggesting that the compny itself had the financial resources to see itself through a downturn.

                      My suggestion is that:

                      a) Bain could’ve seen the company through its unprofitable phase without loading it with bad, predatory debt that went straight to Bain dividends. (This bad, predatory debt made bankruptcy, raiding pensions, more extreme layoffs, damage to local creditors, etc. all more likely and more severe. The bad debt is what Bain did wrong.)

                      b.) Someone else could’ve bought Bain and seen it through it’s unprofitable phase without loading it with bad, predatory debt. Maybe this wouldn’t have happened. But as Blaise points out, GST had been profitable, and analysts -not just Bain’s analysts- would’ve seen that GST could be returned to profit. Indeed, it is not wrong to say that GST was a profitable company over the long haul. It was only temporarily unprofitable due to market fluctuations amd a need for upgraded infrastructure. I find it unlikely that no one would’ve bought a company that had good long term prospects. The company and its workers were unlucky that Bain bought it and Bain decided to act like a predator not a savior by adding bad, predatory debt on top of good debt that was used to restructure.

                      In short, I could see a defense of Bain’s actions with GST if someone could show me that in order to save GS, it was necessary that Bain suck all that money out of GS (33MM according to that Rolling Stone piece) to the detriment of workers, the pension, creditors, and taxpayers.

                      But it clearly wasn’t necessary as lots of economists, business writers, and private equity people agree. Lots of LBO’s occur where the equity firm buys the company and doesn’t take large amounts money out of the company (hurting the company and its workers and local creditors) until it is profitable again. That’s an honest LBO where you use capital to save a company. The problem is that honest LBO’s turn out lower profits in the long run, so there is a temptation to engage in “Bain-style” LBO’s (as Delong calls them) when you can and suck money out of companies, regardless of the consequences to the company, its workers, etc. (The tax code and bankruptcy law allow and encourage this dishonest, predatory LBO.)

                      This clearly wasn’t one of those honest LBO’s. It could’ve been done as an honest LBO. It would’ve been an honest LBO if Romney had set up Bain to aim at profits while also trying to help workers, play fairly, etc. But that’s not how Bain was set up and people got hurt (maybe not killed, but hurt.)

                      That’s a fair attack on Romney.

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                    • Kris,

                      What Blaise and I are saying is this. The underlying business model of GS was always profitable. This is proven by the fact that after bankruptcy and hell, the company did well.

                      It’s unclear here whether you mean before Bain bought it or after. If you mean before, that’s clearly refuted by the evidence of the steel industry at the time. If you mean after, then it’s because of the business model Bain put in place, but it doesn’t in fact rebut anything I’ve said because a) I’ve already said Bain appears to have managed the company badly, and b) it doesn’t demonstrate that Bain “gutted” the company (mis-management is not synonymous with gutting).

                      The debt that GS took on to restructure was good debt. An honest manager who cared about the company would’ve added that debt. It was the bare minimum anyone would do.

                      Except that the former owners didn’t. You keep stating as an indisputable fact something that is directly refuted by what the actual owners actually did. Here’s the direct quote:

                      B.C. Huselton, a vice president of the business at the time, tells me that in 1990 the Armco CEO held a meeting. “He told us, ‘Look, we either try to sell it, or we’ve got to shut it down.'” (Source)

                      When the owner says the options are X or Y, it’s clearly false to claim that “anyone” would have done Z.

                      So here are the facts you have repeatedly failed to address:
                      1) The total upheaval of the American steel industry in the late 20th/early 21st century as it struggled to shift away from it’s 19th century business model in the face of powerful international competition.
                      2) What the actual owners of GS believed their options were.

                      I’m not about to give ground or take you seriously as long as you keep making up the facts.

                      And for the last time, I’m not defending Bain. All I am doing is critiquing a factual claim made by Blaise and you. I keep saying Bain managed the company badly, and I’ve got not brief for Bain in general– all I’m saying is that they didn’t gut this particular company. It’s dishonest to insinuate I am doing anything else.

                      ___________
                      P.S. Ad hominem does not mean “personal attack” or “insult.”

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                    • Kris,

                      My position is not so much that there isn’t an issue here, but rather that the issue that may lie here has been buried under a lot of mischaracterization among those seeking to make it an issue, poisoning the well, so to speak.

                      It’s possible that another buyer could have come in and did everything that Bain did right and nothing that it did wrong. It’s also possible that those criticizing the move are either (a) monday morning quarterbacking what was simply an error in judgement on Bain’s part or (b) ignoring some internal dynamics that may have lead to their decision-making. It’s also possible that somebody else would have come in and did worse. It’s also possible that nobody would have come in at all. These are all counterfactuals, and I’m not sure why I should assume the worst possible interpretation instead of the alternatives.

                      Demonstrating more of a track record would be helpful – Annenberg suggests that this was an outlier. The pulling-at-the-heartstrings nature of the initial lob and portraying this as Evil Corporate America (with Romney as its exemplar) has the opposite effect on me as intended*. DeLong’s broader attacks on the question of financial engineering as a component of our economy do have some resonance, a failed experiment in Missouri less so.

                      At the very least, I see some nuance here, and a willful desire not to acknowledge any nuance by people who generally pride themselves on being able to acknowledge nuance.

                      * – I will probably not be voting for Romney this time around. These lines of attack have generally made me more rather than less sympathetic to him. This is mitigated at least somewhat by Romney’s response to these attacks.

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                    • I guess the previous owners couldn’t recapitalize the company to see it through its temporary unprofitable phase.

                      Christ! That’s what I said! Except for your “temporarily” unprofitable line. Without the recapitalization it would not have been “temporarily” unprofitable, but “permanently” unprofitable.

                      Bain could’ve seen the company through its unprofitable phase without loading it with bad, predatory debt that went straight to Bain dividends.

                      And nobody here has argued any differently. So why do you keep emphasizing that point as though you are making some kind of refutation with it? What’s gained by harping on a point that absolutely nobody here is making?

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                    • James,

                      I thought you were done with this conversation? No?

                      As near as I can tell, you only disagree with Blaise’s use of the term “gutting.” You think gutting means something worse than the horrible thing -and you now agree it was horrible- that Bain did.

                      I call it gutting because it hurt GS, their pension, and made bankruptcy more likely. You say gutting is something worse, liquidating a company I guess, and then accuse Blaise of holding the position that GS was liquidated. That’s not a charitable way to argue. Sounds like a straw man to me. But what do I know, except that I’ve taught logic and critical thinking for 10 years.

                      But I am glad that you agree that Bain hurt workers like the people in the ad by sucking money out of GS.

                      Will,

                      I agreed lomg ago that it is an “unknowable counterfactual” as to what would’ve happened if Bain hasn’t bought GS. (I suspect everyone saw how to restructure GS. There’s no special magic here. I think GS would’ve been bought by someone.)

                      But that’s irrelevant. Bain, or any company that bought GS, could’ve restructured GS without the predatory debt that hurt them so badly.

                      Am I supposed to give credit to Bain for buying the company and then mistreating it, just because its somewhat possible no one else would’ve bought it?

                      By analogy, if Romney buys a dog and humps it, is his humping of the dog justified by the fact that its possible someone else might not have bought the dog? No! Romney should buy the dog AND not hump it.

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                    • Kris,

                      Both you and Blaise used words that smack of precisely a particular type of activity Bain’s been accused of, the type of activity described above. To butcher and gut mean to tear apart. But suddenly it turns out you didn’t actually mean that Bain was doinfpg the types of things ut is so often accused of doing. OK. Sure.

                      And then like a true troll you pretend I’ve come around to your side when I’ve been saying Bain managed the company badly before you even entered the conversation.

                      You say you’ve taught logic and critical thinking for a decade. That’s truly astounding, given that you don’t even know the correct use of a basic logical fallacy of ad hominem. And given that you were making up facts, ignoring facts, making unjustified claims about your opponent’s position, and apparently getting all your information from sources representing only a single ideological perspective…None of that is what I was taught in my logic class, and it’s exactly the kind of thing I try to teach my students not to do.

                      But seriously, a teacher of logic who doesn’t know the correct usage of ad hominem? Isn’t that a bit like a geometry teacher who doesn’t know how to use the Pythagorean theorem?

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                    • James,

                      No one accused Bain of liquidating GS. (The accusation is raiding GS while it was down, making a possible bankruptcy more likely and more painful, which you agree happened and was wrong.)

                      You want to say that’s what Blaise did. But he didn’t. He used the metaphor of gutting.

                      And if you had asked Blaise what he meant by gutting, and does he mean liquidating specifically, the apparent need for your prolonged fit would never have arisen.

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                    • Kris,

                      Enough. You’re being ridiculous. Blaise used the term butcher. Butcher means to cut up. Bain didn’t cut up GST. They arranged $100 million in upgrades and merged it with another company.

                      You introduced the term gutting. Gutting means to rip out the entrails. We’ve agreed that the money Bain commandeered from the bond issue didn’t do GST any good and probably did them some harm. But arranging for $100 million in upgrades to a company is to add new and better entrails, not to gut it.

                      You and Blaise both chose particularly poor terms, and now you’re tapdancing all over trying to explain why butchering and gutting don’t mean tearing a company apart. Fine, I’ll take you at your word that you never meant Bain tore the company apart, even though that’s what they’re so frequently accused of doing that probably anyone would think you were referring to that practice. But you chose a really misleading word and stuck by it. Don’t give me any more of your pretense at being skilled in critical thinking. If you want to keep dragging this out I’ll just keep pointing out that you were making up the facts to suit yourself. You can’t run from the fact that you said “anyone” would do “z,” when the actual owners explicitly said their options were only “x” or “y.”

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                    • James,

                      “Enough”? Are you my boss or my mom or something?

                      Blaise said Bain “butchered” GS.

                      You then said, no Bain “didn’t just strip it of value.”

                      We all agree that they “stripped it of value” by extracting too much cash.

                      I’d call that “butchering” or “gutting.” If I gut a pension or butcher a company, that could mean any number of things, including:

                      a.) Cutting it up into pieces
                      b.) Cutting money out of it unnecessarily
                      c.) Cutting out experienced workers and replacing them with inexperienced low pay people

                      This reuters article says that Bain did a.) and b.).

                      http://www.reuters.com/article/2012/01/06/us-campaign-romney-bailout-idUSTRE8050LL20120106

                      Thus it is completely reasonable to say Bain “butchered” the company under a perfectly acceptable definiton of “butcher.”

                      You have some narrow definition of the metaphorical use of “to butcher” where it has to refer to carving a whole company into smaller pieces. (Actually, Bain tried to join GS to another steel company. So there it was gluing, not cutting.) You are accusing Blaise of accepting your definition of “butchering” or “gutting”even though its clear he doesn’t mean that at all.

                      You’re nitpicking and being uncharitable in your response to Blaise and me, all in some attempt to throw up a cloud of distraction that directs attention from the fact that what Bain did is wrong, What’s important is that we all agree that Bain “cut” money out of GS, they cut experienced workers, they “cut” the pension.

                      All that cutting sounds like butchering.

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                    • Also,

                      That reuters article suggests that Bain “spurned an offer” (not a formal offer) to buy GS.

                      So the idea that no one else would buy GS but Bain (who cut the crap out of the company, which can be construed as butchering) is entirely unfounded and almost certainly false.

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                    • Kris, you can’t take an offer made in 1997 as proof that somebody would have made the offer in 1993. By 1997, Bain had infused the company with cash (and debt), upgraded the equipment, and so on. Bain invested in a company that was failing (“close or sell”). The offer was made to a company that wasn’t.

                      C doesn’t really constitute gutting or butchering, in my view, so much as incompetence. At least, not without further explanation. B might, but not for the comparatively small amount paid out to dividends ($65 of $378 total debt, $36 to Bain). Until I got the facts and figures, I’d assumed that most of the debt was the dividends rather than less than 20% of it.

                      In any event, my definition of “butchered” and “gutted” is the same as James’. I heard it the same way he heard it. I don’t think it applies here. I think attempts to make it apply here are tortured. (ADDED: Except the pension part. The connotations of a “gutted” pension involve simple under-funding, which Bain was doing along with just about everybody else at the time. It wouldn’t be my word of choice, but it’s much less a stretch than a reference to what Bain did with the company as a whole.)

                      At the very least, when you gut something, or you butcher it, you don’t expect it to survive. All indications are that Bain believed in the company and continued to throughout. Both Annenberg and Reuters suggest this. They just screwed it up along the way.

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                    • the idea that no one else would buy GS but Bain … is entirely unfounded and almost certainly false.

                      I agree. That’s why I never made any such claim. And once again we see you making something up; being dishonest. I have nothing but contempt for this kind of dishonesty. There is no gain in debating a dishonest person.

                      Please be my guest in comforting yourself with whatever you believe you have won. Whatever it is one can actually gain through falsity.

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                    • James, it really doesn’t seem anything close to a certainty that someone else would have purchased the company for the sake of keeping it going. Such would have involved a lot of investment for something that might not have panned it. Bain was willing to take that risk. On what basis should I believe that investors were lining up around the corner to do so? Certainly not on the basis of someone being willing to buy the company after the investments were made.

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                    • Sorry, that prior comment was directed to Wil, not Tod.

                      And I don’t understand your last comment, Wil. I never said anything about whether there would have been other buyers for GST. The question of whether any firm other than Bain would have been willing to buy is something that never came into my mind; I’ve never even pondered the question, much less made a statement about. It was Kris who falsely implied that I did.

                      I appreciate and respect your general agreement with me on this issue, but I’m not going to pursue it any further, for the reasons I state in my last response to Kris.

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                    • James, it was in reference to your “I agree” to Kris in reference to his/her comment about it being “almost certainly false” that nobody would have bought GS if Bain hadn’t.

                      (My take is one of agnosticism with an added dose of “the likelihood that someone would have come in and done what Bain did sans its mistakes” as being less than 50/50 with all other options on the table considered.)

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                    • Will,

                      I agree that the offer referenced doesn’t prove that GS would’ve been bought earlier when Bain bough it. But it shows that there was interest in buying the company once it had taken on debt to restructure. I think its quite likely Bain isn’t the only capital company that could’ve seen that GS was a profitable company long term that just needed some changes. But I still maintain that its an “unknowable counterfactual” as to what would’ve happened had Bain not bought the company or had Bain not “butchered” it.

                      But that’s no defense of Bain as my admittedly humorous analogy with the dog shows. Romney buys a dog and humps it. Might the dog have been put to sleep had Romney not bought it? Who knows. But that is no justification for Romney humping the dog. The only justification Romney could give for humping the dog is that the humping was necessary in order to purchase it and save it.

                      But not one person thinks that Bain’s loading GS with predatory debt was necessary to save it or run it or whatever. Not one. And if you think its necessary, you need to establish that as a defense of Bain. You don’t just get to assert it as some kind of prima facie truth.

                      If it wasn’t necessary, it was immoral profiteering that made bankruptcy worse, worsened the pension situation, etc. And that kind of pain is only morally justifiable if the pain is necessary to bring about a greater good. It was wrong, and unecessary. (My reference to other companies was only one way of illustrating how unnecessary Bain’s cutting and butchering of GS was.)

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                    • James,

                      I am glad you have stooped to calling me (to sum up) a dishonest dickish, liberal parrot troll. You have also insulted me as a teacher (based on the fact that I know that there are multiple uses of the term “ad hominem” as I proved) and implied that I don’t read enough.

                      You’re showing your spots and admitting that I am right about everything, including your hair splitting about Blaise’s use of the term “butchering.”

                      Yet you just get angrier and angrier, flailing around and calling me names. You are so mad that you are still discussing this, trying to get some sort of “last word” victory despite the fact that you said you were “done” many, many comments ago.

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                    • Kris, I’m not asserting that the benign explanation is accurate, merely that there is one and so the humping analogy doesn’t w work because there isn’t one for the humping. Also, the dividends may have been absorbable and so have no ill-effect (we know now they weren’t, but it was not necessarily known at the time), while a humped dog is ahumped dog and there is no equivalent of absorption there. Lastly, a relatively small portion of the debt actually went to the dividends, so I am hardpressed to talk about the debt that sunk it in te context of that part of it. I’m not saying Bain is blameless here but the “OMG THESES PEOPLE ARE HORRIBLE” angle is left wanting, in my view. They are people that made mistakes and miscalculations the sort of which I see in the private sector a lot.

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                    • Kris,

                      The most troubling aspect of this to me is the underfunding of the pension. However, did Bain do anything wrong? If so, why weren’t they prosecuted for doing something wrong?

                      Once they bought the company, it was their property to do with as they like. They could close it, strip it, sell it, borrow from it, or convert it into a greeting card company. That is the right of an owner, right? They are not obligated to offer jobs in the future, and any employee that suggests they do is arguing for privileged status. Right?

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                    • Kris,

                      I agree completely that illegal and immoral are different things. What did Bain do that was immoral? Reallocating assets is not immoral. Discontinuing a job, moving capital from low to high returns or pulling capital out of a business are not immoral. Indeed they are good actions. They are actions that lead to prosperity and the advancement of humanity. Right?

                      The pension thing still DOES seem shady to me, but I am no expert.

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              • From Daily Kos.

                A leveraged buyout is a tactic through which control of a corporation is acquired by buying up a majority of their stock using borrowed money. … Once control is acquired, the company is often made private, so that the new owners have more leeway to do what they want with it. This may involve splitting up the corporation and selling the pieces of it for a high profit, or liquidating its assets and dissolving the corporation itself.

                Had Bain split up GST and sold off the pieces, or had they simply liquidated the assets and dissolved it, then I would be agreeable to the claim that they “butchered” or “gutted” it. So far there has been no demonstration that they took that course of action. They managed it badly, sure, but the specific actions they took with regard to that company are different than those listed above.

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                  • Read the link. Kos is referencing another source, and they didn’t say all lobs result in liquidation. The point was not to define boos, but to pinpoint the practices that are most widely criticized, that most people are going to think of when they hear the terms gutting and butchering. The point also was to refer to a more liberal source, to balance my prior reference to he wsj, as an implicit comment on your apparent inability to read beyond one ideological sector.

                    Truly the one thing you’ve convinced m if s that you cn’t distinguish between critical thinking and ideological parroting. And there are few things I have more contempt for than ideological parrots. On another thread right now I’m laughing at koz’s claim that only Republicans are true citizens, and truthfully I don’t see much difference between you and him.

                    You want me to even begin to take you seriously, then demonstrate that you’re also reading some economists besides those you can feel safe knowing won’t challenge your beliefs. As for me, I’m a libertarian ho thinks Krugman’s Keyenesianism is wrong, and a political scientist who knows damn well that Krugman shies away from analyzing government with the same rigor he uses to analyze markets. And yet I’ve got four of his books on my shelf that I both recommend and frequently dig back into. So when you throw Krugman and DeLong at me, I’m not much impressed unless you can demonstrate that you’ve given serious attention to other economists as well, insteadvofvjustbusing them as an appeal to authority.

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                    • As you should know, the term “ad hominem” just means against or at the man.

                      The most common use of “ad hominem” is to refer to the specific fallacy of ad hominem that you have in mind. But there are other accepted uses:

                      “adjective
                      1.
                      appealing to one’s prejudices, emotions, or special interests rather than to one’s intellect or reason.
                      2.
                      attacking an opponent’s character rather than answering…”

                      http://dictionary.reference.com/browse/ad+hominem

                      Also,

                      “Usage Note:.. . The expression now also has a looser use in referring to any personal attack, whether or not it is part of an argument, as in It isn’t in the best interests of the nation for the press to attack him in this personal, ad hominem way. This use is acceptable to 65 percent of the Panel. · Ad hominem has also recently acquired a use as a noun denoting personal attacks, as in “Notwithstanding all the ad hominem, Gingrich insists that he and Panetta can work together” (Washington Post). This usage may raise some eyebrows, though it appears to be gaining ground in journalistic style.

                      http://www.thefreedictionary.com/ad+hominem

                      I admit the looser usage. But that’s because I’m not pedantic.

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                    • Lastly,

                      Are you arguing that I am an ideological parrot because I disagree with you? (Invalid Argument)

                      Or are you arguing that my position on Bain is wrong because I am an ideological parrot? (Ad hominem fallacy. Also invalid, of course.)

                      Or are you just insulting me because you feel like this is a contest between us and you have lost and you are mad?

                      I really don’t know which of those it is. Do tell.

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                    • Lord, Kris, you teach this stuff! Be a fishing professional! I’m not joking and I’m not trying to score a cheap rhetorical point.
                      If you aren’t teaching your students the difference between the actual logical fallacy and the degraded uses of the term that don’t refer to logical fallacies, you’re doing them a hell of a disservice.

                      I’m calling you an ideological parrot because you are repeating a standard liberal line, don’t appear to be able to look at the issue from a different perspective, and don’t give any evidence of having read anything but liberal writers. Seriously, you’ve had every opportunity t demonstrate that you’ve looked at a non-Krugman/DeLong source, and you haven’t done so. What am I supposed to think?

                      As to Krugman’s books, his popular ones really aren’t that big. They’re very accessible to a lay audience. I recommend them. Sincerely. They’re much better than his columns; less ideological, more analytical, and showcase his often playful approach to explaining politics. On form he’s a top notch writer, too, making the books really enjoyable to read.

                      Ah, I’ve lost the argument, have I? When it turns out that all you’ve been saying all along is what I said up-front, that Bain didn’t manage GST well, and all we’ve really been doing is quibbling over the details of that bad management? When you’ve made up alternative-universe “facts” to bolster your case? That’s what passes for a win in your professional capacity as a critical thinking teacher? OK, you’re a winner, Kris. You’re a real winner.

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                    • I read Tyler Cowen and Mankiw and others. As Delong and Krugman point out, the sad thing as that some of the right-leaning economists have sold out and are now engaging in near-academic fraud in, for example, their report on HHMT.

                      If there is a right-wing critique of Delong’s attack on “Bain-style” LBO’s (of which Delong clearly thinks GS is a paradigmatic example), let me know. Otherwise, this weird attack on me that I must be wrong about Bain because I don’t read x or I’m a liberal parrot” is either an ad hominem fallacy or an irrelevant insult.)

                      The far right Von Mises “economists” have always been kooks and should only be read -like birthers or truthers- for seeing how smart people can go so wrong in their thinking.

                      I tell my students about both uses of the term “ad hominem” to make sure they know the difference. I may use some of these comments as examples.

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            • If you’re going to play fact-checker, then you ought to stick to the facts. Instead, CNN here, as self-appointed fact-checkers generally, prefers to deal with an imputed content, and then further distorts and compresses the ad to reinforce a point. In other words, it does the same thing to the ad that it accuses the ad-makers of doing to Romney.

              CNN, via Blitzer, claims that the ad – a SuperPAC ad, incidentally, not an Obama campaign ad – “basically blame[s] Mitt Romney for a woman’s death from cancer.” That would be an extreme reading of the ad’s statements, though it is true that, in making health care less accessible to people, you probably do increase the number of untreated cancers and earlier deaths from cancer. Soptic alludes to the possibility, but specifically states, in language distortively elided from the CNN rendering in the excerpt after “PRIORITIES USA AD” – that he doesn’t know how long his wife might have been ill. Soptic’s claim isn’t “Romney killed my wife,” but, an opinion based on observation, that “Romney does not care about us in any way.”

              The ad makes the factual claim that Bain closed down the plant and extracted profit from the overall transaction, and assumes that Romney is responsible. Everything else is Soptic’s testimony regarding his beliefs about Romney’s beliefs. You can wonder whether there’s good reason to pay attention to Soptic, but it’s also true that Romney and his party oppose Obamacare and measures like it, which likely would have greatly relieved the predicament of this particular family and of families like it in regard to getting health care, reinforcing Soptic’s more general claim.

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              • It’s called innuendo. It’s called leaving a false impression. It’s called Obama letting others do his dirty work and claiming clean hands.

                Mebbe it’ll work. Mebbe it’ll backfire. There’s been too much of this for people not to notice, too much for at least some people to deny. CNN, for instance. Even CNN sees what a slam dunk this one is.

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                • “People”? Would those be the same “people” – sometimes including the likes of Newt Gingrich, Rick Santorum, John McCain, et al – who somehow fail to remember the “slam dunks” of yesterday or yesteryear in regard to “Personification of Greatness”‘s (PoG, hereafter) campaign methods? PoG once supported a health care reform that, as PoG’s spokesentity Andrea Saul has noted (http://www.politico.com/news/stories/0812/79482.html#.UCKQfD_Xpmg.twitter ) would have helped the Soptics. Now, of course, PoG pledges to repeal the version of the same law passed by the Kenyan Muslim Alinskyist Socialite. Mebbe “people” will notice. Mebbe not.

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                  • Newt Gingrich, CK? He’s not running. The truthful chain of argument [which you’ve laboriously forged for us] is too weak and specious to be worth making an ad about.

                    The entire purpose of the ad here is to leave a false impression, and we all know it. Even CNN knows it.

                    If this were a debate, a game, then the sophistry could be excused, even admired, I guess. But this is real life, and this whole thing is an unscrupulous lie.

                    The more I see of this stuff the more I’m convinced the American people won’t stand for it. I honestly feel that we’ve picked the right man in every election in my lifetime, although I’ve never been more worried that we won’t than I am this year.

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                    • I know, I know, tu quoque and all, but come on Tom, let’s be real. I’ll grant that this ad is generally manipulative, dishonest and sleazy. But you’re reaching for the smelling salts while your guy is doing stuff like this:

                      http://www.motherjones.com/kevin-drum/2012/08/mitt-romney-doubles-down-opposition-obamas-support-welfare-queens

                      We’re in the middle of an election cycle in which one campaign has figured out that fact checks don’t matter at all. Once you run ads like the above (or the ones taking “you didn’t build that” out of context, or the ones taking Obama’s “if we talk about the economy, we lose” line out of context, etc. etc.), you no longer get to be all hot and bothered about this stuff without it being obvious that you’re putting on a show for the refs.

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                    • The entire purpose of the ad is to leave an overall absolutely correct impression – that PE of the sort PoG specialized in to the tune of a vast personal fortune looks the other way at the direct human costs of its operations. It further correctly implies that, for Republican conservatives, that’s a feature, not a bug. It’s how things are supposed to be. Ignoring the direct negative human costs of the enterprise is the essence of capitalism, beginning with the capitalist’s own deferral of consumption on his own behalf. It does not work in any other way. The ad leaves the absolutely correct impression that y’all got nothing for people like the Soptics. It leaves it up to the electorate to decide whether at this particular time we need an adjustment more in the direction of deferral of present consumption or greater actual present consumption – it’s the same issue whether it’s health care, or “stimulus,” or you didn’t build that infrastructure spending. (It’s even the same issue on tax progressivity, though in a more indirect and initially counterintuitive way.)

                      That’s all there is to it. It’s not the “lie” in the ad you find so unforgivable, it’s the fact that it humanizes the truth in a too vivid manner, making the Republican conservative ethos of looking away more difficult to implement. There is no lie in the ad itself, just an “impression” you find disturbing. It’s not even in the same universe of falsifiability (and obvious falsehood) as the current Romney welfare advertisement, which, is Saint Sarah might say, just makes things up, but is now being sung unisono by the entire hack and flack rightwing ensemble.

                      The welfare pseudo-argument also happens, if on the basis of literal falsehood that some “people” may actually come to notice, to reflect the same correct impression, if not one very impressively correct in this instance, regarding the difference between Rs and Ds as betweens Cs and Ls again relating to present consumption. Rs and neo-lib/DLC Clintonites believe that the consumption of welfare recipients must be deferred for their own good and for the sake of society as a whole. Traditional American social liberalism holds that people have a right to subsistence, and that society has a duty to provide it. Non-pathologically capitalist Christians believe that, too.

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                    • The purpose of the ad is to show that Bain (Romney’s company, despite the fact that he was on vacation, running the Olympics) made millions while bankrupting companies like GST and taking workers healthcare, pensions, and benefits, and laying them off. Taking healthcare hurts people, perhaps especially people with cancer, even if it doesn’t directly kill them. Bain benefited. Americans got hurt.

                      It meets that purpose. You think it has an innuendo that it doesn’t, because you think it isn’t an attack ad unless the lady died right after the dude got fired.

                      I suppose it would be worse if the guy’s wife had died immediately, but it is bad enough that she had cancer and Bain dumped the workers in a dirty-LBO to make a short term profit.

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                    • a) Tell me y’d be fine with this if the GOP did it.

                      b) Tell me y’d have bothered to make this ad based on this weak chain of legitimate argument, no innuendo. As though if Bain Capital never existed, the woman wouldn’t have died.

                      There is no causality here, as you now know—the woman had health insurance for years after her husband’s plant closed.

                      c) That this is an ad hom attack on Romney’s very humanity. Well, skip that part. That’s legitimate in some quarters.

                      UK:

                      Steel worker’s wife who died of cancer had her own health insurance: The deception behind the shocking Obama campaign ad that blames Romney for woman’s death

                      Video features steel worker Joe Soptic, who was laid off and lost his health benefits after the company owned by Bain Capital went bankrupt

                      Claims his wife Ilyona Soptic died of cancer as a result of him losing his health insurance

                      Mitt Romney was no longer leading the operations of Bain when the steel mill shut down in 2001

                      Mrs Soptic died five years after her husband lost his job

                      By MICHAEL ZENNIE
                      PUBLISHED: 12:08 EST, 8 August 2012 | UPDATED: 13:01 EST, 8 August 2012

                      Read more: http://www.dailymail.co.uk/news/article-2185505/Deception-revealed-Obama-attack-ad-blames-Mitt-Romney-womans-cancer-death.html#ixzz22z2U5EDd

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                    • Tom,

                      I would be for the Republicans running this ad or any true ad. This is a true ad.

                      The attack is that the man lost his job and his wife had cancer. She eventually died, but the ad is not saying the loss of his insurance -which hurt the family more when she lost her insurance- killed her. In fact, it doesn’t matter that she died for the attack to work. She had cancer and Bain (Romney CEO, founder, and sole shareholder, legally responsible party, who approved of this sort of deal) took his health insurance away and made it harder for her to get healthcare when she could no longer work. That’s a hell of an attack on Bain and Romney.

                      Here’s a question. If you worked somewhere and you got laid off or lost your contractually promised healthcare and benefits as a result of a crooked-LBO, and then your wife got cancer and you couldn’t provide for her insurance, wouldn’t you be mad and depressed? There she is, dying. Your wife. And you can’t earn enough to get her good care at the hospital. You weak pathetic man. Your best option to help her is to divorce her so she can declare poverty and get some help through medicaid. Some husband you are, right. Thanks Mitt Romney for the gift to my family. Enjoy your money.

                      What a country! Death panels indeed.

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                    • Glad you don’t contend my assertion, Tom.

                      I’m still curious about one thing, though, Tom. (I answered your question, but you didn’t answer mine.)

                      Do you think pointing out that he lost his insurance while his wife was sick (or before she was sick) is a good attack ad? Assume that she didn’t die or that the ad didn’t discuss her death. Would it be a “true” attack ad? Would it be a good attack ad?

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                    • “She had cancer and Bain (Romney CEO, founder, and sole shareholder, legally responsible party, who approved of this sort of deal) took his health insurance away and made it harder for her to get healthcare when she could no longer work. That’s a hell of an attack on Bain and Romney.”

                      Kris-

                      I think the add goes even further. No, not in the way many cons are describing it, which is an insinuation or direct contention that Romney killed this man’s wife. Heavens no. No where does the ad say that. The ad contends that Romney doesn’t care about the little person. He didn’t care that his handling of this company put some people in positions like this family was in. He engaged in “good business practice” completely inconsiderate of the impact that those practices had on real people on the ground. As was his right. He had no obligation to this family. But wouldn’t we like to see a bit more from someone running for President, someone at least nominally tasked with caring about the little people?

                      The attack in this ad is not that Romney killed a woman. He didn’t. The attack is that he didn’t and doesn’t care. Maybe that’s untrue, but he’d do a hell of a lot better job showing he does care than mischaracterizing the ad and attacking the man levying the charge.

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            • The ad doesn’t imply she died. It implies they had to deal with her cancer without insurance. Keiler is splitting hairs and thinks she’s debunking. She is a moron.

              The ad isn’t falsified by any of Keiler’s investigation. That’s obvious.

              Moreover, the spirit of the ads claims are honest in the light of Keiler’s claims, too. This factory worker lost his ability to help his wife through cancer because of Bain’s actions. (Romney was still owner, CEO, and was responsible for Bain regardless of whether he was on vacation, running the Olympics). His wife had a job, but couldn’t continue it eventually. So the husband’s lack of insurance occurs at a time when his wife has cancer. She briefly has insurance, so it seems like they’ll be okay surviving the firing, but when she loses that insurance, the impact of the Bain firing hits home.

              That’s not death, but I’d put in top 5 shitty things that could happen to me: you can’t help your wife live by getting her insurance, cause richy-rich dumped you from your job. For a while, you think it might be okay, but then she loses her job and dies in front of you while you can’t pay medical bills.

              I love this country, but that shouldn’t happen.

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              • Sorry, that should say, “the ad doesn’t imply she died right after the dude was fired or that they didn’t find other ways to insure themselves for brief periods, or even that she died as a direct result of the insurance loss (though it could’ve contributed, who knows).”

                It sucks that he lost insurance for Bain to make a short term profit. It would suck even if she had been lucky enough to live. That’s the attack.

                Firing people is fine. But firing people in a crooked LBO is not fine.

                Also, this family would’ve been better off under the ACA. That is very much part of this ad.

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          • Blaise,

            You are a blowhard. I won’t explain anything to you because it’s become obvious you aren’t bright enough to comprehend what’s being explained. You put on a good front, but you lack comprehension skills. I just don’t understand the anger here when someone disagrees with the group consensus. It’s like monkeys flinging turds.

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            • Oh, Farmer. If ever the truth needs defending, and now would be that time, we may always count on you to not defend it.

              I may not be very bright. I might not comprehend. I do appreciate the compliment about Good Front… but you’re not exactly defending the truth by attacking me. Or anyone else. Get that through your head. You’re doing a wretched job of defending whatever truth you’re going on about. And you’re doing a wretched job of attacking me. Can I give you a few lessons on how to attack people? The first and sovereign rule is to tell the truth about them.

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              • “Can I give you a few lessons on how to attack people? ”

                Let’s not forget you attacked first. You are such a weasel. But I’m sure you can teach me a lot — I mean, after all, you’ve been a stock broker, a translator of Swahili poetry, an honorary Nigerian chieftain of a tribe you saved from malaria while shooting elephants with the Duke Earl, a CIA plumber, a ballet dancer in Denmark, program writer for a hi tech company that is actually a front for government surveillance of Russian diplomats, financial planner for Carlos Slim, and a giver of care to orpans, syphilitcs and blind homosexuals in Bosnia.

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                • And more besides! I’ve wandered through the blogosphere like Steerpike, pricking and poking and making Stupid People yell like cats. It’s tremendous fun for me at a personal level, an inexpressible and sadistic delight, a little candle, illuminating my days and nights, knowing I can, with a few words, reduce ideologues and blowhards all over the world to manic frothing and idiotic gibbering.

                  Face it, I’m just plain meaner than you. And it’s all mind over matter. I don’t mind. You don’t matter. Now just you quit barking, I am not intimidated in the least by your fact-free bluster.

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                • Blaise hasn’t done half the things that a friend of mine has done. Truth is often stranger than fiction.

                  I mean, really, what do you call someone who is licensed as a priest for a religion he doesn’t believe in? The person who has a blasting license (for firework displays)? Who has written for multiple TV shows? And who helped write the DVD standard?

                  If you don’t stick to one job, you’ve got a lot to say.

                  Hell, if I write out what I’ve done — and it’s not much, I even start sounding impressive! Eyetracking, designing t-shirts, making a video game, working on the third most important program in my part of the country, canvassing half the city…

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  9. “If there’s anyone out there who still worries Barack Obama may not have the mettle to run the salt-the-earth negative campaign that his stewardship over a lackluster economy requires”

    This is the conventional wisdom, and it’s probably correct, but I still wonder if it’s actually correct. That is, the premise that an alienated electorate that just sick and tired of both candidates would still decide in Obama’s favor. Obama’s been going ‘negative’ for a bit now; the most prominent example I can think of before this one was his ad aimed at women with the theme that Romney is going to take away your right to an abortion. (which is not wrong, but it’s not Hope either).

    It’s probably a correct strategy, though, because Romney is who he is. But, really, if there were anyone else in there with a less plastic persona, someone that voters could really connect with? Obama would be toast with this strategy. (as Carter was)

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    • Obama has done things to drive up his personal positives over the years at least with many demographics that he needs to win.

      He instituted a version of the Dream Act. He got rid of Don’t Ask Don’t tell, he won’t defend parts of DOMA and is now in favor of gay marriage. He passed the auto bailout and ran positive on that and American manufacturing. He’s done a lot of speaches sounding positive about the future, greeen jobs, infrastructure projects, etc.

      Hell, he was too pollyanish on the debt ceiling confrontation, but I remember the polls showing him coming out as looking somewhat more reasonable.

      Oh yeah, and he ordered the desth of Bin Laden, the continued drawdown in Iraq, and an operation that helped kill Kgadhaffi (sp?).

      Whether he’ll be succesful or not, I think Obama is aiming at the right blend of positive and negative in his ads. (And he had a similar blend in 2008. It wasn’t all hope and change, then.) He’ll run on a lot of his achievements and has done so in the past few years. (Its interesting to imagine how he will discuss the ACA, though.)

      Moreover, the negative focus on Romney right now sure seems like a temporary focus on defining Romney leading up to the convention when more low-information voters (some of whom are swing voters) will learn about Romney. Any candidate would do the same. You want to define Romney as the apathetic, Wall Street working, scion of a CEO, who flip flops, who is willing to support the Ryan agenda, who wants only to be president, which will benefit him and his friends at the expense of the working class. (All of that is true, IMO. But we’re talking what is effective rhetoric here, so truth is out the window.)

      The ads and the campaign will look different after the conventions, IMO.

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      • Ok, fair enough, it’s just that I don’t remember any specific negative ads back in ’08 (the Bush Administration was the best negative ad Obama could possibly run), and the contrast between then and now is striking (but probably necessary) (and effective)

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        • Well, do you mean number of overall ads or percentage of ads. In 2008, Obama had a lot of negative ads and so did McCain. A higher percentage of Obama’s ads were positive, though,because Obama had the spending advantage and a polling lead and could afford a lot of positive ads. McCain was behind and at a spending disadvantage, so he went more negative.

          There’s a lot of info here:

          http://www.washingtonpost.com/blogs/fact-checker/post/did-obama-run-the-most-negative-ads-in-us-history/2012/02/01/gIQAYUkriQ_blog.html

          I think Obama has spent a lot of his bully pullpit time and capital going positive and trying to sell his achievements: the ACA, Bin Laden, etc. He has the advertising disadvantage now and has spent a lot of his time going positive, so now it makes more sense to talk about Romney and go negative.

          At any rate, I don’t see any reason to believe that Obama was an especially positive politician. He is good with positive rhetoric, so people remember that. And, IMO, his negative ads -including these- are usually pretty banal and uncontroversial, so people don’t remember them. (This is hardly a Willie Horton ad.)

          But he has always been willing to “draw contrasts.” His positive rhetoric is more about “coming together” as a people (post racial, less divisive, doing what we can agree on, not letting idealism get in the way of compromise, etc.) than not running negative ads in a political campaign.