By Paolo von Schirach
May 26, 2012
WASHINGTON – Obama and his surrogates keep attacking Mitt Romney’s record as head of Bain, the private equity firm that made him very rich. They are throwing at him every possible stereotype: heartless boss of an asset stripping company, vulture capitalist, a man with no humanity who showed no consideration for the human suffering caused by the closing of manufacturing plants he ordered, and so on. Nicely crafted TV ads feature people who had lost factory jobs as a a consequence of the reorganizations ordered by Romney and his team at Bain. With emotional and dramatic tones they recall what happend to them and countless others. And it was all because of Bain and Romney. The openly pro Obama cable TV outlets, such as MSNBC, pile on with an avalanche of experts producing “facts” that indicate how Romney actually destroyed assets while sucking in all the value of the companies Bain took over. Bain as a cancer. Pretty strong stuff.
In fairness to Obama, similar scripts was used at least for a while during the Republican primaries by other Republicans like Rick Perry and Newt Gingrich who were trying to depict Romney as a “bad capitalist”, as opposed to the good ones who build empires, but always with a gentle and caring touch.
Capitalism is bad
Still, these relentless attacks against private equity as if it were indeed the evil step brother of an imaginary socially minded, good capitalism should be noted. While Obama’s attacks are not openly against private enterprise and capitalism “as a system”, his opponent in this 2012 elections is the closest thing to a very successful American businessman. At this stage, whatever distinctions Obama may want to make, (see below), in essence he is attacking capitalism, free enterprise and all that goes with it, including “creative destruction” that is to say the accepted understanding that new enterprises come out of the destruction of older and less efficient ones. All of a sudden, according to the president of the United States, in America pursuing profits is at least suspect, if not totally evil. And, even worse, becoming very rich as a result of free enterprise is disgraceful and morally questionable.
Nuances in Chicago
True, enough, Obama has tried to make some nuanced distinctions. At his May 21 press conference in Chicago, Obama pointed out that being the CEO of a company is not a qualification to be president.
“My view of private equity is that it is set up to maximize profits. And that’s a healthy part of the free market. That’s part of the role of a lot of business people. That’s not unique to private equity. And as I think my representatives have said repeatedly, and I will say today, I think there are folks who do good work in that area. And there are times where they identify the capacity for the economy to create new jobs or new industries, but understand that their priority is to maximize profits…when you’re President, as opposed to the head of a private equity firm, then your job is not simply to maximize profits. Your job is to figure out how everybody in the country has a fair shot. Your job is to think about those workers who got laid off and how are we paying for their retraining. Your job is to think about how those communities can start creating new clusters so that they can attract new businesses. Your job as President is to think about how we set up an equitable tax system so that everybody is paying their fair share that allows us then to invest in science and technology and infrastructure, all of which are going to help us grow. And so, if your main argument for how to grow the economy is I knew how to make a lot of money for investors, then you’re missing what this job is about”.
Fair enough, so a president is much more than a CEO. His public policy concerns go way beyond those of a CEO. I guess we can all accept that. That said, Romney does not say that he will use in his presidency the same approach used at Bain. He claims that his record as CEO of a major enterprise proves that he can manage large organizations. (In contrast, when Obama got elected in 2008 he had managed nothing. Not a thing. Not even a lemonade stand. He had zero executive experience).
Obama is attacking free enterprise
Whatever Obama’s distinctions in Chicago, the general tone of the attacks against Romney are about his character and ultimately his morality and his humanity as revealed by his tenure as a very successful CEO.
My point here is that quite intentionally Obama and his associates are sending the message that capitalism is bad, that making a profit is immoral and that allowing a capitalist into the White House means more suffering for the common folks, because capitalists have no morality and no principles. All this is amazing, because this is America, the land that made capitalism its secular religion.
Of course there have been other times in which it was popular to attack Fat Cats and Robber Barons. Attacks against blood sucking quasi-criminals who prey on the hard working American people are not new. But they are not that common either.
In this campaign, Obama has reinvented himself as the protector of the humble and the weak against Mitt Romney, a man whose real record in business –we are told– is about asset stripping, closing factories and firing helpless employees.
This line of attack was tested and vetted
Let’s pay attention here. This line of attack against Romney did not emerge accidentally. I am quite sure that this “attack the capitalist” approach has been vetted and tested by the Obama campaign through innumerable focus groups and countless polls. Eventually it was adopted because the Obama people really believe that it will work. In other words their data shows that, at least in some critical battle ground states, attacking capitalism is a winning strategy in America. Let me say this again: in America, (not Bolivia or Venezuela), attacking capitalism gets you elected to national office.
A different America
If Obama’s strategists are right, (and I really hope they are not), the resulting picture is truly scary. It means that millions of Americans really have a negative opinion of private enterprise and capitalism. They prefer the supposedly helping hand of government. If this is indeed what millions believe, then this has become a different America. An America, as others have pointed out, much closer in values and aspirations to Europe. Given Europe’s sorry state of terminal decline, (at least the entire South), the notion that we are headed that way, because this is what the people want, is truly sad. It would mean that America lost its original character and the value system that supported it.