Everyone, Calm Down

You’ve seen it in a hundred Hollywood movies – the standard panic scene. You know, a giant rogue wave has barreled in out of nowhere and capsized the big fancy cruise ship, turning it upside down so that the floors are now the ceilings and all that stuff – and then someone starts screaming. We’re all going to DIE! This will go on for some time, for maximum effect – the audience is supposed to shudder or something – and then the calm and decisive hero slaps the screamer in question across the face, hard, perhaps several times, sort of waking them up from their panic. In many cases, and in all parodies of such scenes, the screamer in question falls silent, in embarrassment or sometimes shame, and then delivers the requisite response. “Thanks, I needed that”. And then everyone figures out how to get out of the particular pickle they’re in. After all, in the movie in question the title song is all about how there’s got to be a morning after – there always is.

And really, in that particular movie, the ship’s flooded upside-down grand ballroom was just a soundstage over at Fox, on Pico at Motor, across the street from a rather nice eighteen-hole golf course. It was all nonsense, which was pretty much what we were offered in the seventies, the golden age of the schlock disaster movies. Then things changed. In 1980, Paramount, from their soundstages down on Melrose at Gower, gave us Airplane!

In that movie, the Zucker brothers weren’t very nice. You might remember their send-up of the slapping-the-panicked-character routine. After that there were no more blockbuster disaster movies with their sad array of faded former big stars, hoping not to be forgotten, in thankless cameo roles. There couldn’t be. People would giggle. Panic was passé. We calmed down.

Still the trope is useful. Someone always panics. And someone has to slap some sense into them. In terms of problem-solving, panic is useless. FDR knew that. He did once say that we have nothing to fear but fear itself – everyone calm down, we’ll get out of this particular pickle. And one of the first things he had to do when he took office was deal with a run on all the banks – he had to shut them down, immediately, or the whole system would collapse as everyone tried to get their money out all at once. So he did shut them down, all of them – but he called it a Bank Holiday. That sounds so nice. That sounds pleasant – but panic is useless, and, if you can’t slap some sense into people, sometimes you can trick them into gaining perspective, or at least buy some time for them to come to their senses and do the right thing.

And now the Republicans find themselves in a bit of a disaster movie. This is about six thousand jobs lost, and so many others outsourced, and plants closed, and lives ruined. But it wasn’t Mitt Romney’s fault. He had left Bain Capital long before all that happened, in spite of what the SEC filings said, the filings he himself had signed. Yes, Obama may have crossed an ethical line if he really is saying Romney is lying, lying to hide things – unless it’s all true. There’s a lot of evidence it is true, and subtle counterarguments that it isn’t true at all, and others saying it doesn’t matter. It’s a pickle – Romney was the nominal CEO of Bain for the whole time, sort of – and the Republicans seem a bit panicked.

If Romney were to release his full tax returns that might clear it all up – just where he made his money, when – but he won’t release those. And thus he’s reduced to spending all his time defending himself, not attacking the other guy, and certainly not talking about his agenda of wonderful things he’ll do for the country when he’s elected, as he knows he will be. That’s deadly. When you spend all your time defending yourself, voters will sense something is wrong. They’ll sense the desperation and fear there. They can smell fear. Romney has asked for an apology from Obama – Romney said he wasn’t lying – but that’s panic. Romney seems to be rattled and angry about these Bain charges, but can’t seem to defend himself or strike back.

And it only gets worse:

Chicago mayor and Obama campaign surrogate Rahm Emanuel continued the attack on Mitt Romney today over a lack of transparency on his tax returns, encouraging the Republican campaign to release more. Emanuel noted that Romney handed over two decades of tax returns to the John McCain campaign in 2008 when he was being vetted for the VP slot, and after seeing the returns, the McCain campaign decided that Sarah Palin would be a better running mate. …

Emanuel pointed out that Romney’s own father advocated for disclosure, and made an interesting point about the returns when they were handed over to McCain campaign in 2008:

“He has only released one year, to the McCain campaign he released 23 years. And he’s telling the people, ‘I’m not going to give you what I gave John McCain’s people in 2008.’ And when he gave them 23 years, John McCain’s campaign looked at it and went, ‘Let’s go with Sarah Palin.’ So whatever’s in there is far worse than just the first year.”

That’s not nice, nor is this:

President Obama defended his campaign’s fierce attacks on Mitt Romney’s history with Bain Capital, declining his Republican opponent’s demand for an apology.

“No, we will not apologize,” Obama said in an interview with WAVY-TV in Portsmouth, Virginia, the AP reports.

“Mr. Romney claims he’s Mr. Fix-It for the economy because of his business experience, so I think voters entirely legitimately want to know what exactly his business experience is,” he said.

That’s a challenge, and it’s clear that someone has to slap some sense into Romney:

ABC News’ George Will slammed presumptive Republican presidential nominee Mitt Romney for failing to fully release information on his tax returns and offshore accounts, saying Romney “must have calculated that there are higher costs in releasing them.” ABC News political analyst Matthew Dowd agreed, saying “there’s obviously something there” in Romney’s returns that he doesn’t want public.

“If something’s going to come out, get it out in a hurry,” Will said this morning on the “This Week” roundtable. “I do not know why, given that Mitt Romney knew the day that [John] McCain lost in 2008 that he was going to run for president again that he didn’t get all of this out and tidy up some of his offshore accounts and all the rest.”

“He’s done nothing illegal, nothing unseemly, nothing improper, but lots that’s impolitic,” Will added.

Just do it. Take the hit, if there is one, and move on. That was a slap in the face, the kind meant to be helpful. It’s only politics, unless it isn’t:

Political strategist and ABC News political analyst Matthew Dowd said “there’s obviously something there” in Romney’s tax returns that he doesn’t want to release publicly, adding that Romney’s refusal to produce his prior returns was a sign of “arrogance.”

“There’s obviously something there, because if there was nothing there, he would say, ‘Have at it,'” Dowd said. “So there’s obviously something there that compromises what he said in the past about something.”

“Many of these politicians think, ‘I can do this. I can get away with this. I don’t need to do this, because I’m going to say something and I don’t have to do this,'” Dowd added. “If he had 20 years of ‘great, clean, everything’s fine,’ it’d all be out there, but it’s arrogance.”

Many see it that way, but then Mary Matalin, known as a clever Republican strategist, said the debate about the tax returns, and about all the offshore accounts too, is a “distraction, and it’s not what people care about.” And maybe she’s right, but they can smell fear.

Of course there was other advice:

Bill Kristol and the Obama campaign agree on something: Mitt Romney should immediately release his tax returns.

“He should release the tax returns tomorrow. It’s crazy,” Kristol said on “Fox News Sunday.” “You gotta release six, eight, 10 years of back tax returns. Take the hit for a day or two.”

The conservative commentator said the presumptive Republican presidential nominee then should give a speech on Thursday calling for a “serious” debate with President Barack Obama on capitalism, allowing the campaign to turn the page and put the focus back on the president’s record.

There’s got to be a morning after, if we can make it through the night – that’s how the song goes – and Thursday morning will do – but the Bain business won’t go away:

“There may have been a thought at the time that it could be part time, but it was not part time,” [Romney spokesman Ed] Gillespie said. “He took a leave of absence and in fact he ended up not going back at all, and retired retroactively to 1999 as a result,” he added.

How does one retire retroactively? What does that even mean? Andrew Sullivan offers this:

CEOs are responsible for their companies, whether they are managing them full time, part time or even retroactively retiring while managing them. Period. The buck stops with the CEO, just as much as it stops with a president.

And he cites a Bain partner at the time saying this:

“Mitt’s names were on the documents as the chief executive and sole owner of the company,” Ed Conard, who served as a partner at Bain Capital from 1993 to 2007, said in an exclusive interview with Up w/ Chris Hayes. Asked again if Romney was chief executive officer of Bain Capital from 1999 to 2002, Conard said, “Legally, on documents, I suppose, yes.”

Despite Romney’s statements that he left in 1999, Conard’s new remarks suggest that, in fact, Romney’s continued ownership of the firm enabled him to negotiate a better exit deal. “We had to negotiate with Mitt because he was an owner of the firm,” Conard said.

Sullivan:

Romney, in other words, doesn’t have a leg to stand on. He has been running a campaign against the “Obama economy” insisting that the president own every single month he has been in office in order to condemn his economic management all the more – despite at least a first year in which Obama cannot really be held responsible for the fallout of an economic collapse he inherited. So Romney insists on maximal responsibility for Obama and the economy.

But responsibility for Bain? Think about it. No one disputes that Romney co-founded Bain, hired most of its staff, and honed its methods and strategies from 1984 to 2002. No one can dispute that he was paid at least $100,000 from 1999 to 2002 for being CEO. There is no massive difference between the kind of strategies Bain pursued from 1984 to 1999 when Romney was managing full-time and from 1999 to 2002, when he was managing part-time and by his own lawyer’s assertion that his Bain activities “continued unabated just as they had.” Is Romney saying that nothing that happened at Bain after 1999 is his responsibility but that everything that happened after January 2009 is all Barack Obama’s fault?

Yep, that’s what he’s saying.

And here’s the requisite slap in the face:

The only way he can dig out of this hole – yes, Bill Kristol is right – is to release twelve years of tax returns just as his father did. Until he does, the Obama campaign has every right to double and triple their insistent criticism of Romney’s Bain record. And there will be more and more blood in the water.

But Ed Conard said something else:

“He’d created a lot of franchise value, and we were going to pay him for that,” Conard said, adding: “We had a very complicated set of negotiations that took us about two years for us to unwind. During that time a management committee ran the firm, and we could hardly get Mitt to come back to negotiate the terms of his departure because he was working so hard on the Olympics.”

That leads Kevin Drum to tell everyone to calm down:

If Conard is right, Romney not only wasn’t involved in Bain’s business during this period, he was up to his neck in so many alligators that he could barely spare the time to negotiate his own retirement package. I have to say, that doesn’t sound like a person who was keeping himself aware of what was happening at Bain, let alone taking even a modest hand in making management decisions.

Politically, I understand why this story has gotten so much oxygen. And it’s worth digging into, since Romney has inexplicably opened himself up to it by insisting over and over that he had literally zero involvement with Bain during the 1999-2002 period, something that seems unlikely for a CEO and sole shareholder. But honestly… there’s nothing all that new about this story. Romney took a leave from Bain in 1999, probably had a bit of contact with Bain’s management during the next few years, and was involved in both strategic and daily decision-making only tangentially. In other words, not very involved, but not quite zero either. Beyond that, the details hardly matter.

And there’s this from the interview:

Asked if the factory closures and lay-offs that occurred between 1999 and 2002 were characteristic of Bain Capital’s record before 1999, Conard said, “I believe that’s true, yes. I think that Bain Capital does what Bain Capital does, which is try to make companies stronger and grow them faster.”

Conard also said that he did not believe Romney was “ashamed” of any part of Bain Capital’s record. “You say ashamed, I see great pride,” Conard said of Romney’s position on Bain Capital’s entire record. He added that he believed Romney would embrace Bain Capital’s record rather than try to distance himself from it once the campaign intensifies in the fall. “When the debate really starts, in August, September and October, we’ll see. I think he’ll own it.”

So there was never any point in running away from Bain, only what Kevin Drum sees as panic:

Bain is Bain. Even if Romney wasn’t much involved in management after 1999, it was still the company he built. The only problem is that back during the primaries he became so desperate to avoid being tainted by the unpopular aspects of running a ruthless private equity firm that he panicked when the inevitable attacks came and started insisting that he shouldn’t be held responsible at all for anything Bain-related after precisely February 1999. This has since been followed by increasingly wobbly towers of nonsense, like Ed Gillespie’s claim today that Romney “retired retroactively.” This was never really tenable from the start, and all of Romney’s problems have flowed from that original miscalculation. He can’t run from Bain, and he shouldn’t have tried.

Romney shouldn’t have panicked. Someone should have slapped him in the face much earlier. He could have said thanks, I needed that – and said he was proud of Bain, even in those “out” years.

Now it’s too late and the disaster movie had turned absurd. Dick Durbin, the number two Democrat in the Senate and a key ally of Obama, used the dreaded scalded cat analogy:

“We need to get down to the bottom of why… why Mitt Romney is running away from his company, Bain Capital, like a scaled cat,” Durbin said during an appearance on NBC’s “Meet the Press.”

“Because there is evidence that under Bain Capital, they were exporting American jobs to low wage companies and he doesn’t want to be associated with it,” Durbin said, answering his own question.

BooMan piles on:

This whole thing is beginning to remind me of the Seinfeld episode about everyone’s rigorous heterosexuality, “not that there’s anything wrong with that.” Romney is denying something he really should feel no need to deny. Right?

Ah, Hollywood again – but Seinfeld’s New York apartment was a soundstage in Studio City out back, over the hill, not in Hollywood proper – not that it matters. We know the scene.

And later BooMan adds this:

I understand Mitt Romney’s basic argument, which is that he took a paid leave of absence from Bain Capital in 1999 and that he didn’t exercise any executive authority over the business again afterward. He didn’t originally know that he wouldn’t be coming back, so he continued to act as CEO in some capacities, like filling out paperwork or even, perhaps, attending a board meeting of some subsidiary, but he can’t be blamed for decisions that the company made while he was focused on the Olympics or launching his gubernatorial bid. That’s basically the theme the right is using to defend him, and it makes sense as far as it goes. The problem is that it doesn’t go very far.

Let’s just phrase the charge a little differently and say that Mitt Romney enriched himself by owning a business that made huge profits by outsourcing jobs and downsizing companies. Can he dispute that he personally profited as the CEO, chairman, a sole shareholder of Bain Capital in the 1999-2002 period? Obviously, he cannot make that claim.

Moreover, if he didn’t like what the company was doing, he had the power to make them stop. I haven’t seen Romney come out and claim ignorance about Bain’s activities. He’s just saying that he didn’t make those decisions. At best, he approved those deals retroactively by not expressing any displeasure.

So, what is Romney’s defense? That he didn’t work on the deals even though he made tons of money off them and never complained?

That’s absurd:

It was his company. His baby. He created it. He grew it. He wants us to admire his work there so much that we make him president. And then he turns around and says, “I didn’t have anything to do with that.” I mean, that’s just remarkable. And it’s not like Bain Capital behaved any differently once Romney took his leave of absence. He’s just trying to avoid responsibility for certain deals, even though there is nothing particularly special about those deals.

Imagine if Bernie Madoff had taken a leave of absence a few years before he got busted. Would anyone take him seriously if he claimed he wasn’t a bad guy because some of the fraud took place while he was on his paid leave of absence? Either what Bain Capital did in 1999-2002 was shameful or it wasn’t. If it was shameful, then so is what Bain Capital did throughout the 1990’s.

Why is Romney acting like his company was a criminal enterprise the second he stopped running it, and not a moment before?

It’s just panic. It happens all the time. Someone should have slapped him. That’s what they do in the movies. It always works.

But then there’s that other movie, Airplane! Sometimes people just laugh.

About these ads

About Alan

The editor is a former systems manager for a large California-based HMO, and a former senior systems manager for Northrop, Hughes-Raytheon, Computer Sciences Corporation, Perot Systems and other such organizations. One position was managing the financial and payroll systems for a large hospital chain. And somewhere in there was a two-year stint in Canada running the systems shop at a General Motors locomotive factory - in London, Ontario. That explains Canadian matters scattered through these pages. Otherwise, think large-scale HR, payroll, financial and manufacturing systems. A résumé is available if you wish. The editor has a graduate degree in Eighteenth-Century British Literature from Duke University where he was a National Woodrow Wilson Fellow, and taught English and music in upstate New York in the seventies, and then in the early eighties moved to California and left teaching. The editor currently resides in Hollywood California, a block north of the Sunset Strip.
This entry was posted in Bain Capital, Mitt Romney and tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s