Greed and Debt
- Thread starter Musburger
- Start date
I search for solace in history sometimes. Chester Arthur is a pretty interesting character. Endorsed by the Republican-machine politics of Sen. Roscoe Conkling, Arthur was forced on popular James Garfield as vice presidential nominee to get the votes needed for nomination.
Perceived as a friend to the corrupt, with the power of the presidency Arthur rose above expectations (not for his sponors) to allow significant political reform. Maybe Rommney is tired of looking after the interest of millionaires at the expense of the common man and really wants to do good by the average taxpayer. Also, while it's certainly true that Rommney sometimes profited while the company on life support died, it's also true that there were a lot of significant job-creating turnarounds.
Sometimes those that have taken advantage of the system are those best equipped to play the regulator. Those that know how to game the system would know the loopholes that should be fixed.
Perceived as a friend to the corrupt, with the power of the presidency Arthur rose above expectations (not for his sponors) to allow significant political reform. Maybe Rommney is tired of looking after the interest of millionaires at the expense of the common man and really wants to do good by the average taxpayer. Also, while it's certainly true that Rommney sometimes profited while the company on life support died, it's also true that there were a lot of significant job-creating turnarounds.
Sometimes those that have taken advantage of the system are those best equipped to play the regulator. Those that know how to game the system would know the loopholes that should be fixed.
Uninformed
5,000+ Posts
When we are talking about distressed companies, you can be assured that the company was doing something wrong - wrong products, markets, distribution, management, etc. They were distressed for a reason. To get these companies on track, requires change. When change is required, people lose jobs, plants close, and the business usually contracts. And if the turnaround is successful, new people are hired and new plants are opened (perhaps overseas if that is what is required to be successful).
Musberger, the point is that management in leveraged buyout firms may or may not have nefarious desires, but just because a company is in the business doesn't automatically make it bad. It is the nature of the business that these linked articles are attacking.
Musberger, the point is that management in leveraged buyout firms may or may not have nefarious desires, but just because a company is in the business doesn't automatically make it bad. It is the nature of the business that these linked articles are attacking.
Rex Kramer
1,000+ Posts
Mus, I admit I didn't read the whole article. I got through about 7 minutes of it, and it was so full of shrill rhetoric, sarcasm, and one-sided criticism that I wanted those 7 minutes of my life back. In lieu of giving this joker another 15 minutes, I'll simply rely on your characterization of his work.
What disturbs me about this article is that I'm starting to believe people don't understand what a business is anymore. I've never really been a businessman. I've really only had two "real jobs." I've worked for the Texas Legislature (government employment) and as trial counsel to two small law firms (private sector but I managed the cases not the business of running the firms). However, I do understand that the purpose of a business is to make money within the confines of the law, and a business' employees and officers have an affirmative duty to the shareholders to do exactly that.
I think Americans are losing sight of that (as evidenced by the misguided characterizations of Romney's work at Bain). That's a dangerous trend, because it means that American businesses are going to become less and less competitive in the global economy and fail more often. As our people become dumber, there will be a structural downgrade in our economy.
What disturbs me about this article is that I'm starting to believe people don't understand what a business is anymore. I've never really been a businessman. I've really only had two "real jobs." I've worked for the Texas Legislature (government employment) and as trial counsel to two small law firms (private sector but I managed the cases not the business of running the firms). However, I do understand that the purpose of a business is to make money within the confines of the law, and a business' employees and officers have an affirmative duty to the shareholders to do exactly that.
I think Americans are losing sight of that (as evidenced by the misguided characterizations of Romney's work at Bain). That's a dangerous trend, because it means that American businesses are going to become less and less competitive in the global economy and fail more often. As our people become dumber, there will be a structural downgrade in our economy.
Deez,
You've argued that everything Bain did was legal, and that generally the companies in question were struggling. That is certainly true. I'm not arguing that Bain/Romney broke any laws. My main points are these two:
1) Because of globalization/off shoring, even when Bain's intervention resulted in a positive outcome for the company and its shareholders, that did not translate into "growth" domestically. That is, the success or failure of the company had little if any positive effect for American workers.
2) The model for Bain's profits was based on debt creation. Many supporting Romney as the potential savior of the US economy do so based on his business acumen. But if you're going to project Bain's business model to running the country, what would that mean? Wouldn't it mean massive spending (debt) in order to attempt to revive a dying manufacturing sector? Isn't that the very thing Republicans are running against?
I find it ironic that Romney's success at Bain is the foundation for the public's belief he is qualified to lead the country out of the current economic downslide, given that the model used was debt creation. I suppose the rebuttal would be that the debt was created via the private sector and that Romney would encourage that. Well, I submit that the private sector is tapped out. Excess reserves are at record levels (meaning that banks have the capacity to lend out trillions), but have elected not to do so. Banks aren't stupid. If they aren't lending it's either because it doesn't make sense for them to lend or there just isn't a large pool of qualified buyers looking to take out loans.
You've argued that everything Bain did was legal, and that generally the companies in question were struggling. That is certainly true. I'm not arguing that Bain/Romney broke any laws. My main points are these two:
1) Because of globalization/off shoring, even when Bain's intervention resulted in a positive outcome for the company and its shareholders, that did not translate into "growth" domestically. That is, the success or failure of the company had little if any positive effect for American workers.
2) The model for Bain's profits was based on debt creation. Many supporting Romney as the potential savior of the US economy do so based on his business acumen. But if you're going to project Bain's business model to running the country, what would that mean? Wouldn't it mean massive spending (debt) in order to attempt to revive a dying manufacturing sector? Isn't that the very thing Republicans are running against?
I find it ironic that Romney's success at Bain is the foundation for the public's belief he is qualified to lead the country out of the current economic downslide, given that the model used was debt creation. I suppose the rebuttal would be that the debt was created via the private sector and that Romney would encourage that. Well, I submit that the private sector is tapped out. Excess reserves are at record levels (meaning that banks have the capacity to lend out trillions), but have elected not to do so. Banks aren't stupid. If they aren't lending it's either because it doesn't make sense for them to lend or there just isn't a large pool of qualified buyers looking to take out loans.
Uninformed
5,000+ Posts
Lake_Travis_Horn
500+ Posts
Romney's objuective in rebuilding those companies wasn't to increase jobs, it was to restore the companies' to health. Critizing him for not growing jobs while doing that is no more reasonable than criticizing Obama for not creating jobs when he was a community organizer or a college professor.
The key is that Romney understood the business workd well enough to know what it took to achieve the objective. Obama has demonstrated that he doesn't have a clue what it takes for a business to be successful, and the way for the government to "create jobs" is to create an environment where companies can be successful and thereby hire people. Obama doesn't know how to create that environment and it philosophically opposed to most of the actions required to create that environment if he did understand it.
The key is that Romney understood the business workd well enough to know what it took to achieve the objective. Obama has demonstrated that he doesn't have a clue what it takes for a business to be successful, and the way for the government to "create jobs" is to create an environment where companies can be successful and thereby hire people. Obama doesn't know how to create that environment and it philosophically opposed to most of the actions required to create that environment if he did understand it.
Nobody's arguing that Obama has any answers. Hell, he's had 4 years. He hasn't a clue. Leave him out of this discussion please.
And while Romney understands what it takes to be personally successful in today's economy, an economy now based on financialization, how does that bode for the general public? If success means creating debt, transferring it onto another entity, and extracting wealth via selling/moving assets off shore, tell me how that will translate into raising the standard of living for Joe Sixpack?
And while Romney understands what it takes to be personally successful in today's economy, an economy now based on financialization, how does that bode for the general public? If success means creating debt, transferring it onto another entity, and extracting wealth via selling/moving assets off shore, tell me how that will translate into raising the standard of living for Joe Sixpack?
Hornius Emeritus
2,500+ Posts
It seems to me that you guys are really missing Musberger's overall, arching point, which is not about the legality or the correctness of these particular financial transactions but of the kind of man Romney represents as defined in his "Archipelago man" thesis.
I agree, Musberger: the overall trends of wealth distribution in this country are worrying. The rich used to create jobs with their profits.
I agree, Musberger: the overall trends of wealth distribution in this country are worrying. The rich used to create jobs with their profits.
Good point at the end. While large businesses have the ability to borrow and expand, shrinking income in the citizenry lessens demand. As a result, why should businesses make investments? Globalization seems to have hit a wall. American incomes shrink and credit is maxed out. Neither Obama nor Romney can do anything about that.
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