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Saturday, September 24, 2016

What are these phantasmagoric money machines that they call “private-equity firms?” They’re much in the news these days, because a fellow who was a private-equity magnate is presently running for president. Mitt Romney piled up a quarter-billion-dollar personal fortune through his Wall Street equity outfit, Bain Capital, and he now claims that, because of his success in that business, he knows how to “fix” our economy.

Before you cheer that, note that private equity whizzes are all about The Fix — not necessarily a good thing. They operate by borrowing big piles of cash at high interest rates from rich speculators to buy out XYZ Corp. Then, to meet the interest payments owed to the speculators (and to siphon off a financial killing for themselves), the fixers do two things: One, they plunder XYZ’s assets, selling the profitable chunks of the corporation; and two, they severely downsize the XYZ workforce, firing as many workers as possible and demanding deep wage cuts and benefit givebacks from the employees they keep.

It’s a raw redistribution-of-wealth scheme, shifting XYZ’s wage payments from its many workers to a handful of wealthy high-rollers. The process downsizes America’s middle class, while creating no real economic value. Nothing equitable about it.

But the fix also includes a set of very special partners, few of whom are even aware that they’re in on the deal: taxpayers. The private-equity business model is not structured on old-fashioned, free-enterprise principles, but on a skewed system of tax loopholes punched into federal law by these financiers’ lobbyists and the lawmakers who do Wall Street’s bidding.

For example, the equity funds are able to load up on such heavy debt to finance their corporate takeovers only because all of the interest they must pay to speculators for that borrowed money is tax-deductible. In other words, our government directly subsidizes private-equity plundering by covering their huge interest payments.

To add to their fun, many of these tax-code scammers grab such big debt deductions each year that they end up paying zero corporate income taxes, even though they rake in millions in profit.

To put a name to this financial flimflammery, let me tell you a corporate morality tale that I call “The Shame of Shamu.”

  • montanabill

    Since nothing they are doing is illegal, it is unfair to tar them. The best place to rectify the situation is with your local Congressman or his replacement. Don’t automatically vote Democrat or Republican thinking your party is not to blame. Find out how your candidates for the fall election feel and then vote accordingly. If you don’t do that, you are part of the problem.

    • ixnaa

      Yes do check out where the politicians are getting their money and how they vote, but have you noticed it’s the Repubs that have pushed through Citizen’s United that allows these Super Wealthy donors to go unnamed and unrestrained? Have you noticed how many Repubs including the likely presidential candidate are themselves involved in these activities. Our last chance to get things under control will be to elect a democratic controlled congress and White House AND put the pressure on them to make those changes to this orgy for the rich. With a few exceptions putting Repubs in cffice is putting foxes in the henhouse.

      • montanabill

        In other words, you are going to vote blindly Democrat because you would rather listen to propaganda than do your own homework on individual candidates.

        • The reason these activities are legal is because they spend the money to buy and or influence government through lobbyists or direct donations to candidates. Did you not read the article? Just because it’s legal don’t make it right. Case in point, the right to vote for women, and black people. Slavery! Everything that is legal is not necessarily right or fair.

        • metrognome3830

          Montanabill, can you enlighten us with some examples of Republican congressmen who have bravely stood up against the rest of their party and voted for what is right? I don’t think it would be a long list. As for ixnaa, don’t overlook some of the Democrats who jumped right into bed with the Tea Party Republicans quicker than a Cartagena hooker with a Secret Service agent.

          • montanabill

            You people need to read my response again. I was not advocating for either party. It will not be party apparatus that makes changes. It will the individual congressmen you vote into office. If they are lap dogs for the party (either of them), nothing will change.

          • metrognome3830

            Maybe not Bill, but it did sound like you were leaning slightly righward. Sorry if I misconstrued your message.

          • montanabill

            I won’t deny leaning slightly rightward. I’m a fiscal conservative and a believer in individual self-determination. More like the old Southern Democrats used to be. I’m not party line enough to be a Republican, not isolationist enough to be a Libertarian, and not a believer in big government to be a Democrat.

          • metrognome3830

            OK, I can’t argue with that position. I lean slight leftward, so maybe we can balance things out. I don’t believe in profligate spending, no do I believe that the government has to take care of me. I have been a Democrat, but more recently trying to maintain an Independent status.

        • ixnaa

          As usual you make a comment without reading or understanding what was written. I said to check out the candidates , positions, voting records, and source of income. IF you did that you would vote more often for democrats. You are just brainwashed by all the fox news BS and too stupid to sort out the facts from the propaganda. Never did I suggest voting blindly, quite the opposite, but in typical right wing dipshit fashion you can twist it that way

    • No one tarred them as far as I could see in the article. The article simply told the truth as to how the scam is worked. The sad part it that it is all legal but not moral.

    • getoriginal

      Just because it is not illegal does not make it right – wait a minute – the right makes it legal and then it is right and legal

    • coraktp

      It is completely fair to tar and feather these people because what they do is only legal because they wrote the rules which allow them to rape US companies and get tax deductions for it. They had their lobbyists hand the regulations they wanted to the Congressmen and Senators who they had bought with legal bribes called ‘campaign contributions’ to be enacted as US law.

      It’s easy to win the game when you get to write the rules that stack the game in your favor.

  • clarenceswinney

    GREAT–GOOGLE + SIMMONS MATTRESS
    HOW THAT FIRM WAS ROBBED

  • ObozoMustGo

    DISTRACTIONS……………. DISTRACTIONS………….. DISTRACTIONS
    Focus on the real issue at hand: Obozo The Incompetent

    Government & Society
    Years from now, historians may regard the 2008 election of Barack Obama as an inscrutable and disturbing phenomenon, the result of a baffling breed of mass hysteria akin perhaps to the witch craze of the Middle Ages. How, they will wonder, did a man so devoid of professional accomplishment beguile so many into thinking he could manage the world’s largest economy, direct the world’s most powerful military, execute the world’s most consequential job? Imagine a future historian examining Obama’s pre-presidential life: ushered into and through the Ivy League despite unremarkable grades and test scores along the way; a cushy non-job as a “community organizer”; a brief career as a state legislator devoid of legislative achievement (and in fact nearly devoid of his attention, so often did he vote “present”) ; and finally an unaccomplished single term in
    the United States Senate, the entirety of which was devoted to his presidential ambitions.

    He left no academic legacy in academia, authored no signature legislation as a legislator. And then there is the matter of his troubling associations: the white-hating, America-loathing preacher who for decades served as Obama’s “spiritual mentor”; a real-life, actual terrorist who served as Obama’s colleague and political sponsor. It is easy to imagine a future historian looking at it all and asking: how on Earth was such a man elected president?

    Not content to wait for history, the incomparable Norman Podhoretz addressed the question recently in the Wall Street Journal: To be sure, no white candidate who had close associations with an outspoken hater of America like Jeremiah Wright and an unrepentant terrorist like Bill Ayers, would have lasted a single day. But because Mr. Obama was black, and therefore entitled in the eyes of liberaldom to have hung out with
    protesters against various American injustices, even if they were a bit extreme, he was given a pass. Let that sink in: Obama was given a pass – held to a lower standard – because of the color of his skin. Podhoretz continues: And in any case, what did such ancient history matter when he was also so articulate and elegant and (as he himself had said)
    “non-threatening,” all of which gave him a fighting chance to become the first black president and thereby to lay the curse of racism to rest?

    Podhoretz puts his finger, I think, on the animating pulse of the Obama phenomenon -affirmative action. Not in the legal sense, of course. But certainly in the motivating sentiment behind all affirmative action laws and regulations, which are designed primarily to make white people, and especially white liberals, feel good about themselves.

    Unfortunately, minorities often suffer so that whites can pat themselves on the back. Liberals routinely admit minorities to schools for which they are not qualified, yet take no responsibility for the inevitable poor performance and high drop-out rates which follow. Liberals don’t care if these minority students fail; liberals aren’t around to witness the emotional devastation and deflated self esteem resulting from the racist policy that is affirmative action. Yes, racist. Holding someone to a separate standard merely because of the color of his skin – that’s affirmative action in a nutshell, and if that isn’t racism, then nothing is.

    And that is what America did to Obama. True, Obama himself was never troubled by his lack of achievements, but why would he be? As many have noted, Obama was told he was good enough for Columbia despite undistinguished grades at Occidental; he was told he was good enough for the US Senate despite a mediocre record in Illinois ; he was told he was good enough to be president despite no record at all in the Senate. All his life, every step of the way, Obama was told he was good enough for the next step, in spite of ample evidence to the contrary.

    What could this breed if not the sort of empty narcissism on display every time Obama speaks? In 2008, many who agreed that he lacked executive qualifications nonetheless raved about Obama’s oratory skills, intellect, and cool character. Those people – conservatives included – ought now to be deeply embarrassed.

    The man thinks and speaks in the hoariest of cliches, and that’s when he has his teleprompter in front of him; when the prompter is absent he can barely think or speak at all.

    Not one original idea has ever issued from his mouth – it’s all warmed-over Marxism
    of the kind that has failed over and over again for 100 years.

    And what about his character? Obama is constantly blaming anything and everything
    else for his troubles. Bush did it; it was bad luck; I inherited this mess. It is embarrassing to see a president so willing to advertise his own powerlessness, so comfortable with his own incompetence.

    But really, what were we to expect? The man has never been responsible for anything, so how do we expect him to act responsibly?

    In short: our president is a small and small-minded man, with neither the temperament
    nor the intellect to handle his job.

    When you understand that, and only when you understand that, will the current erosion of liberty and prosperity make sense. It could not have gone otherwise with such a man in the Oval Office.

    Matt Patterson, columnist

    • herchato

      Yea, maybe we should go back to slavery so we can keep our labor costs down so we want have to jump thru all those hoops and waste so much money buying politicians.

      • ObozoMustGo

        herchato… you should consider going back to 3rd grade and starting over. It’s clear that nothing past that point in your “adademic” career had a prayer of sticking in that vacuum you call a head!

        Have a nice day!

    • majong13

      Gee, Obozo, maybe we should make you president! Why don’t you stick to the subject of this article? And by the way, the names you call the president? Perhaps you need to look in the mirror.

      • ObozoMustGo

        The article tries to say that Romney is not qualified to be President because he was an investment banker. I merely point out that if there ever was ANYONE THAT WAS NOT QUALIFIED, IT’S BARACK HUSSEIN OBOZO!!!!

        Have a nice day!

        • AaronNashuaNH

          Name-calling does not become an mature, world-embracing individual. It more befits a junior high school student who fears
          people of different ethnic and racial backgrounds.

        • 1AmericanHoney27

          BozoMust Go….. You may not like his name… You may not like the color of his skin…. You may not approve of his political aspirations But get used to it for you shall know him as Mr. Barak Obama PRESIDENT OF THE UNITED STATES UNTIL 2016….. I’ ve offered you many times Prep H to suck on to give us all some relief But you refused… You continuously open your mouth and insert foot. Today Sir you have made us see you as the south end of a north bound jackass. You couldn’t even be a pimple on the Presidents back side nor are your opinions worth the paper it takes him to wipe his A** with.

          Now you ” Have a Nice Day “. Obama/ Biden 2012

      • mickbl

        Hey ObozoMustGo,
        What right wing racist magazine/paper do you write for anyway?

      • ObozoMustGo

        Thanks for the vote of confidence, majo! I am waaaayyyyyy more qualified to be President than Obozo The Incompetent! No question.

    • AaronNashuaNH

      What a tiresome rant—its clear from this nonsense who really should go

      • ObozoMustGo

        Every bit of what is written is true! Read it. I know it’s difficult to learn that The Wizard is really just a little weasel of a man and that you were completely fooled, but it’s true. There’s really an empty moron behind BH Obozo’s catchy smile and deep commanding voice. You bought off on the cult of personality, dude. Sorry to be the messenger for you.

        Have a nice day!

    • EquiPotent

      You are definately a Troll. This article is such BS it doesn’t deserve comment. You just keep feeding the uninformed, the mis-informed, the racists , the doomsday preppers…adnauseam……..

    • Hungry_Cowboy

      Let’s cut the crap!

      There is only one war the U.S. has won since WWII. Not Korea, not Vietnam, not Kuwait. not Iraq, not Afganistan. And hopefully not Iran. (because we can no longer afford Trillion dollar wars. And maybe because you won’t be first to volunteer. It was Libya! Republicans complained that it wasn”t authorized by Congress.

      In Libya not one American was killed. It was cheap and hasn’t created the $3Trillion cost of Iraq and Afganistan.

      The world has changed in the blink of and eye. I have seen the future. Surgical intervention, quick in and out with expert troops, The greater use of Drones. And REAL intelligence. Not the flim flam of Iraq and mysterious WMDs.

      One Presidential hopeful has declared that he will greatly increase the Defense budget. As one who has been marched through the jungles of Vietnam after it was sprayed with agent Organge, maybe you should revisit the truth!

      • ObozoMustGo

        Hungry… chill out dude. Go git yerself a ribeye and relax! It should take away some of the muchies after hitting your bong hard for all these years!

        Have a nice day!

      • I think we were successful in Bosnia too.

  • majong13

    Great article, thanks.

  • Bad7kitten

    If you think Romney (Willard) can take advantage of the tax code, just wait, God help us if he wins. Willard has sworn a oath in the LDS temple that he will do anything to make sure the LDS church takes over the world. Wake up people, search for yourself on the Internet about this. Romney (Willard) and the LDS church are not Christian they will destroy our country.

    • ObozoMustGo

      You are a religious bigot, kitty!

  • Since most teabaggers and redneck republican ideologs don’t read anything they regard as potentially negative about their favorite politicians (i.e. Romney, etc.), this article and many others like it won’t affect the outcome of this year’s election. Ignorance is a disease that’s difficult to cure.

    • It’s not ignorance but simply the fact that Tea Party Republicans and their supporters on all political paarties, upset with a president that has stood with the base, his supporters and the Americans that need a president to be on their side and let the Republicans assist the wealthy, the rich and businessmen.The New Tea Party GOP, with their radical policies of wanting to strip hard-fought wars and battles with greedy businesses aginst the rights of the Unions, Independent, Free-Choice women, the LGBT community, the poor, the minority, who are being stripped of health insurance, any serious benefits, rights, choices, and creating laws that mirror those in dictor-nations, Oligarchs, Syria-like abuses across the globe today.

    • montanabill

      We noticed that in 2008.

  • jerder

    That happened at Coleman, Inc. in Wichita, KS and another big manufacturer in the late 80’s. They stripped the pension of hundreds of thousands of dollars, sold off portions of the company at a high profit and dozens of employees lost their jobs. Then, a few years later, they sold what was left of the company. Although Mitt Romney, per se did not benefit from this particular transaction, it is one example of how he makes, and has made, his millions. This is not a man who knows anything about how the economy works, or should work, so he knows nothing of how to fix it. Is this who we want for president, a man who thinks nothing of destroying jobs or companies to add to his personal wealth?

  • Since Mitt Romney can see so many things with his speech last night. I wonder if he can also see Russia from there?

  • shinethelight41

    Let the truth have a voice that brings this appalling corruption to the light

  • mit is not your or our friend. he lives, works and worships power and money.he could not care less what happens to the numbers on a chart. unfotunatly thoese numbers are U.S.

  • Tax law is rigged. It is rigged to favor special interests who use some of their tax exempt profits to lobby congress to rig tax law in their interest. Get it? Our government is corrupt. Like the Mafia.

  • noharmdone2012

    I can not believe that you Dummies Put this Richie to run for the President Job ! Its a shame People can not see where this another like ( Bush ) I hope you People wake up before it is too late . He is trying to Get His Finger in the TILL ! Bah Bah Bah Have your Fingers in the CANDY !!!!!!!!!!!!!!!!!!!!!!!!!!

  • Jon

    “I like to fire people”.. M. Romney

  • joyscarbo

    Read Mitt’s book. I read a passage about him considering to be hired on by Baine. He didn’t want to…didn’t think he could make the kind of money doing what he was being hired to do. Baine had to “sweeten Mitt’s pot several times” before he relented and joined with Baine. Once Mitt got the taste for sucking profits of any kind from any source- pensions, profits, piecing out companies, and then going in for the kill…it was Mitt’s kinda work and he was good at it, espeically firing people. He’s now $21 millionaire….who’s “unemployed.” Did you see Mittens in Florida, sitting with a group of people who are unemployed, and joking, “I’m unemployed too…buha, buha.” How do you think these REALLY unemployed people appreciated this facist,elitist ass making light of their plight? How about the cookies in Pittsburg? Mitty: “I dunnno about these cookies. He didn’t make these cookies…Naw…these arent’ any good…got from the local 7-11.” Jerk. Cut away to the republican baker who owns the bakery that made those especially for his republican buddy! Awwwkwaarrrdd!!!

    Unfortunately, it’s not just awkward. It’s really rude and socially inept for Mitt not to know how to act around “normal” or “average, everyday citizens.”
    He is socially inept, can’t get out a genuinely felt sentiment to endear anyone to him.

    How about Hannity telling poor people to eat right and beans and cheap meat. Screw you ass.