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August 16, 2012

the better question about bain capital

I'm noticing that tapping (heh) Paul Ryan as veep has not exactly distracted the press from looking into the greater question of the actions of Bain Capital while Mitt Romney was CEO—there was a nice long bit on The Takeaway this morning, and Yahoo! ran a story earlier this week about a company town in South Carolina.

Though I go think that the question is being misstated a little bit.  In the general investigative piece on Bain, the premise is, "Is Bain responsible for these lost jobs/this pollution/the slow death of this little town?"  That's a very interesting question, and maybe the answer is in some cases yes, but I'd counter, before anyone else gets a chance to, that to a certain extent those jobs were bound to be lost, and that little town was doomed from the git-go.  Manufacturing was going away (without government interference, which didn't happen) no matter what, whether Bain acquired those companies or not.  Maybe Bain was the principal owner that flipped the switch on some of these decisions, but the sad truth is that if it wasn't Bain it was going to be someone else.

No, the better question to ask about Bain Capital is, "How much money did Bain make by shuttering that factory or shipping those jobs to southeast Asia or by killing that company?"  Remember that the private equity business works like this: PE acquires controlling interest in company, usually with borrowed money, PE takes over stewardship of the company, PE pumps up the value of the company (via means including but not limited to slashing payrolls, moving business offshore, etc.), PE tries to sell it for more than it bought it for (or failing that, sell it for parts and let it go belly up).

Now you may say, nothing wrong with that!  In fact, my uncle does the same thing with distressed properties in Missouri.  Cool.  Tell your uncle I said Hi.  But in fact there is something wrong with it: all the time the above process is going on, PE uses it's new control to award itself fat management/consultant contracts, and loads up the target company with debt in the process of doing so.  Private equity doesn't lose, because it rigs the game.  Whether that company goes on to be a success or gets hot-potatoed to some other PE firm or goes under doesn't matter.  The private equity firm, Bain Capital, is making money either way.

So the better question is, in the course of wrecking all those people's lives, how much money did Bain Capital pay itself to do so?

Posted by mrbrent at 9:00 AM

August 14, 2012

progressive insurance

Here is your outrage for the day.  So the sister of comedian Matt Fisher was killed in a car crash this year.  She was insured by Progressive, and the other driver (who ran a red light and survived) was uninsured.  Progressive has been dragging its heels in paying out a settlement, as insurance companies are wont to do.  And the ultimate expression of this reluctance, due to insurance company practices and a nasty loophole in Maryland state law, is Fisher's parents' being forced to sue the other driver for negligence, which driver is being defended in court by Progressive.

And you should read the heart-breaking/well-written account of it by Fisher himself.

That's enough outrage to last you a Tuesday, sure.  But then yesterday Progressive responded to all the Twitter critics of Progressive with the following:

This is a tragic case, and our sympathies go out to Mr. Fisher and his family for the pain they've had to endure. We fully investigated this claim and relevant background, and feel we properly handled the claim within our contractual obligations. Again, this is a tragic situation, and we're sorry for everything Mr. Fisher and his family have gone through.

I know that we live in the age of the non-apology apologies, but it takes an abject lack of humanity to be sorry for "everything Mr. Fisher and his family have gone through" when a good portion of what they've gone though was caused by the apologist.

"Within contractual obligations" actually absolves Progressive of nothing.  In fact it indicts them—if our businesses are going to commit the grossest of abuses and hide behind the fig leaf of, "It's not illegal," then it's time to rethink why we have businesses and what they should be allowed to do.

And some have opined on the Internet that maybe Progressive shouldn't be singled out, since other insurance companies would do the same thing.  Well, if that's the case, then fuck them too.

Posted by mrbrent at 10:28 AM

August 13, 2012

running the olympics

This is an insignificance, a trifle, from the introduction of Mitt Romney that Paul Ryan practiced all weekend:
“Remember the chaos? Remember the waste and the bloated spending and the corruption that was plaguing the Olympics at that time?” Ryan asked sweaty throngs of supporters packed into a steamy furniture factory in High Point, N.C., on Sunday. “Who did they turn to? Who did they ask to drop everything in his life and save the Olympics? That was this man right here.”

Hee.

First, if there's a single soul in High Point, NC, that can remember anything, a single thing, about the exegesis of the Salt Lake City Olympics then I'm Rufus T. Firefly.

But let's not let than get in the way of a c.v., a narrative.  Mitt Romney manages to run the winter Olympic Games in Salt Lake City in 2002 without losing any athletes or setting the city on fire or, I don't know, stubbing his toe real bad on his desk.  If that doesn't qualify someone to be the leader of the free world, I'm not sure what is.

But I guess Ryan has to say something about the narrative, right (while skipping over Bain Capital completely)?

Posted by mrbrent at 9:42 AM

August 12, 2012

paul ryan is "formidable"

By way of talking about the selection of Rep. Paul Ryan as Romney's veep choice, let's talk about this John Podhoretz commentary for Commentary, in which he addresses the "liberal glee" over the pick:
More important is the quality of the glee itself. It’s an ongoing liberal political-character flaw. So insulated a are many, if not most, American liberals that they simply presume that which they despise is inherently despicable, and that what they fear is inherently fearful.

OK now, surely there's some truth to that.  And obviously a correlation to that is that conservatives are guilty of the same thing.  In fact, both sides of the ideological fence are clearly guilty of the assumption that their own ideology is Correct, and that differing ideologies are wrong.  Perhaps this is a human trait.  And Paul Ryan, who may be reviled by liberals, is equally as venerated by conservatives.  Podhoretz admits to as much:

Ryan is a formidable presence in American politics. Generally speaking, formidable players do formidable things.

Paul Ryan is a formidable presence in American politics only thanks to the tireless self-promotion and bottomless ambition of Ryan and his fellow "young guns".  He certainly has elbowed his way into chairing the House Budget Committee (much as fellow "young gun" and non-vice presidential candidate Eric Cantor elbowed his way to House Majority Leader), but Ryan has never run for a national race.  In fact, he has never run for a state-wide election.  A son of privilege, he chose a safe district in Wisconsin and sat on it for seven terms.  That's not formidable.  That's par for the course.

Paul Ryan is only formidable because people like John Podhoretz say he is, and his ability to conjure up an actual budget with actual numbers is seen by people like Podhoretz as some sign of genius.  It just ain't so, or if it is so, it remains to be seen.

As an actual liberal who is actually gleeful, I'll give you this one reason why I'm happy: the time last year when the president invited Ryan to personally attend a speech so that the president could eviscerate Ryan's budget to Ryan's face.  That made me gleeful then, and it'll make me gleeful again.

And in the meantime, for another moment of glee, remind me who is running for president for the GOP again?

Posted by mrbrent at 11:30 AM