Mitt Romney in 1985 Video: Goal of Bain Capital was to “Harvest” Companies for Profit
Mother Jones: In 1985 Video Mitt Romney Said Goal of Bain Capital was to “Harvest” Companies for Profit (Photo credit: Wikipedia)
Mother Jones released a video in which Mitt Romney said the goal of Bain Capital was to identify potential and hidden value in companies, buy significant stakes in these businesses, and then “harvest them at a significant profit” within five to eight years. Um, that’s not what he’s saying on the campaign trail. He’s branding himself as a job-creator. Yep, that’s coming from a guy playing the role of the “sneering plutocrat.”
Andrew Sullivan: “This is not the ’47 percent’ bombshell. It just shows what Bain Capital was about: rewarding its shareholders by “harvesting” companies. That word is clinical. And look: there’s nothing evil or wrong about Bain. It did what it does, it has had some successes and failures, and it’s not a crime to make money this way. But it isn’t business, as Romney concedes, so much as finance.”
Watch the video:
This was cross-posted from The Hinterland Gazette.
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Sullivan was right, but the video shows that Romney wasn’t in the business of “creating jobs” like he claims. It doesn’t put Romney in a good light and it’s a reminder of his 47% comment and keeps that thought in the voters minds.
I wonder how many more of these videos the Obama campaign has stashed away. I would guess several since they released the 47% with 7 weeks to go still. Mittens and company better get cracking on editing some old Obama vids to misquote what he said and make him sound like a Muslim communist or something.
Romney created wealth and did a damn great job at it. But that in no way qualifies him for the white house.
He should be running on what he did as governor, because that actually translates….sadly, he was a true moderate back then and has since disowned that former life,
So a sales speach using finacial jargon is more important that his actual track record? Yeaah ok
His actual track record is obfuscated by the question of jobs lost versus jobs gained in the companies Bain acquired both during his presence there and the immediate time thereafter, when it could be reasonably argued that his influence still guided the attitudes and procedures of the company. Romney hasn’t exactly been forthcoming on that issue.
The pertinent quote is that Bain was not so much about investment as they were about finance. They and most PE firms don’t actually invest money in the target firms beyond the initual buyout which after all doesn’t go into the company but to the previous owners. They take out loans in the company’s name to do two things; one, pay the PE firm back their investment as quickly as possible which in essence puts the company into debt for the previlege of being bought out and, two, to make whatever improvements that can be made with the rest.
The entire sweep of change in the business world over the last thirty years hasn’t been about investing to increase capital it has been about the financialization of business, the turning over of American business to the financial industry, the banks, the investment firms like Bains, the insurance companies. This has been coupled with the financialization of the consumers and the workers, increasing their debt load to astronomical heights.
In 1970 the total profits of the financial industry were 2% of the total profits in the country. In 2007 the total profits of the financial industry were 40% of the total profits in the country. Going into the Great Depression the total private debt in the country was 125% of GDP. Going into the Great Recession of 2008 total private debt was 300% of GDP. The problem in the country is not public debt, it is the huge amount of private debt. The reason that we are recovering so slowly from the Great Recession is because of this huge overhang of private debt. And this huge private debt is a direct result of the financialization of business and of the workers. PE firms like a Bain are just one small part of this.
This is what you will be voting to continue if you vote Republican this year. You will be voting for ever lower wages, more crisis caused by the financial sector, more private debt, more bank bailouts, more money to the already rich, less to everyone else. I am sorry, this seems like a high price to pay for the vague promises from Republicans to roll back fifty years of social progress, install a theocracy and to impose Victorian morality on everyone else in the country.
Brilliant points, merkin.
Shannon is also correct. There’s no skill overlap between PE and WH. PE is all about picking winners & losers and squeezing out wealth. Leading a country is about serving the entire nation.
Since when is “harvest” a financial term? Since when is this any different than what Bain Capital actually did?
If “Harvest” is what he did with Staples then harvest away. What they did is buy companies that were doing badly and tried to turn them around sometimes succeeding, sometimes not. They then tried to relize the difference in value between the failing company and the successful one. That is where they made their big money. I don’t care what they call it. Using terminology that might not be pc dosn\’t really bother me. Sure they tried to structure deals so they would loos as little money as possible no matter what and even make money even if they couldn’t turn a company around. Doesn’t change the fact that the goal, and again where they made their big money, was to turn a company into a buisness that was worth more. Now people are trying to make that a bad thing? Pull the other one.
Honestly you can be against Romney for all sorts of reasons. This kind of crap just seems like partisan BS. Why not concentraite on the real issues rather than throwing all this bs into the argument?
You were the one who said that it was financial jargon, EEllis. Romney was the one who used the term “harvest”. This process worked out well for Staples. Not so well for KB Toys. Romney made a bundle on both.
Of course, as I and many others have said before, Romney’s main qualification for president is his business experience. I don’t think it’s a stretch for the American public to want to know what that experience is. Most of us can think about both the experience he brings to his candidacy as well as the policies he is proposing. Certainly Obama’s background has been given a thorough once-over. Heh.
What Sullivan said.
His business had some hits but fewer misses as far as the investors were concerned, and if they created some jobs, well and good.
No,he should not have emphasized that aspect.
WTF isn’t he a politician, after all
And Obama’s was, hmmmm what were Obama’s qualifications, that’s right just about nothing. Look it’s all bs and you know it. Romney is pushing the conservitive agenda and if you believe in that you vote for him. Obama is a progresive and if that’s your thing you vote for him. Trying to pretened that Romney using the word “harvest” actualy makes any difference is just weak.