TruthOut.org has the Democracy Now interview Matt Taibbi: The Secret to Mitt Romney’s Fortune? Greed, Debt and Forcing Others to Foot the Bill.
A new article by reporter Matt Taibbi in Rolling Stone sheds new light on the origin of Republican presidential candidate Mitt Romney’s fortune, revealing how Romney’s former firm, Bain Capital, used private equity to raise money to conduct corporate raids. Taibbi writes: “What most voters don’t know is the way Mitt Romney actually made his fortune: by borrowing vast sums of money that other people were forced to pay back. This is the plain, stark reality that has somehow eluded America’s top political journalists for two consecutive presidential campaigns: Mitt Romney is one of the greatest and most irresponsible debt creators of all time. In the past few decades, in fact, Romney has piled more debt onto more unsuspecting companies, written more gigantic checks that other people have to cover, than perhaps all but a handful of people on planet Earth.”
Matt Taibi talks about a number of concrete examples of the hypothetical situation I used in the previous post Vulture Capitalism Explained. If you have trouble getting a grasp on what Taibi is talking about, reading my previous post may help. Also, if my previous post was too hypothetical, then Taibi adds the real examples to what I was explaining.
Mitt Romney is up in arms about the federal government’s long term debt which is less than our gross national product. In Romney’s business life in one example in the above video, he invested $18 million to get hold of a company that then borrowed over $300 million to pay him huge profits. After creating this fictitious wealth, he walked off with the cash, put the company in bankruptcy, and left the lenders with close to nothing for their $300 Million in loans.
No wonder Bain has been able to have an 88% annual return for its investors for twenty years. You use the money to invest in what is essentially a heist. The difference with this and other criminal types is that you get the government to write loopholes into law so that what you are doing is technically legal.
But as we liberals, progressives, and Democrats have been saying since Reagan came to office ,”There oughta be a law.” And there could be a law if we got the government out of the hands of the corporate Republicans (and some corporate Democrats.)