RSS

Tag Archives: Paul Ryan

No country for angry old white men: the GOP’s diminishing demographic

Unless the Republican party embraces diversity and renews its appeal to Americans of color, it faces gradual extinction

A delegate holds up a mask Paul Ryan at the Republican Convention, Tampa

A delegate holds up a mask Paul Ryan at the Republican Convention, Tampa, Florida. Photograph: David Goldman/AP

Good for the Republicans trying to mix it up, color-wise. Speakers at their convention last month included South Carolina Governor Nimrata “Nikki” Haley, whose parents emigrated from the Punjab, and Mia Love, a Haitian-American Mormon running for congress in Utah. They reached out to Latinos with New Mexico Governor Susana Martinez and Florida Senator Marco Rubio, and to African Americans with former Secretary of State Condoleezza Rice. Craig Romney, the nominee’s youngest son, even gave a speech in Spanish.

But a few sprinkles of chocolate and caramel don’t change the overall flavour: Republicans are still vanilla. A recent NBC/Wall Street Journal poll showed that among African AmericansMitt Romney polls at 0%. Yes, zero. That doesn’t mean absolutely no black people will vote for him: former presidential candidate and pizza king Herman Cain says he will. So do Representative Allen “Democrats are Communists” West, of Florida, and Texas Congresswoman Stefani Carter, who has just been named to Romney’s “Black Leadership Council.” But the poll data mean that very, very few African Americans, fewer than the poll’s 3% margin of error, support Romney.

He does better with Latinos: between 25% and 30% (pick your poll) claim they’re willing to give the ticket a whirl. Nevertheless, if the Republicans are to win in November, they will have to do it with white voters. Romney’s own campaign numbers gurus say he needs at least 61% of them.

That might work – this year. But it will probably never work again. White America is shrinking. In 2012, for the first time in modern history, the majority of babies born in the US belonged to some kind of “ethnic minority”. According to the Census Bureau, in 25 to 30 years, non-Hispanic whites will no longer make up a majority of the US population. If the Republican party continues to cling to plutocracy, misogyny, homophobia, and racial division, it will be, as President George HW Bush (surely the whitest of white men ever to occupy the White House) would say, “in deep doo-doo”.

South Carolina Senator Lindsey Graham, one of the GOP’s brighter bulbs, worries that they’re “losing the demographic race”. He told the Washington Post:

“We’re not generating enough angry white guys to stay in business for the long term.”

Ed Rollins, a senior strategist, agrees, calling his party “a bunch of old white guys”, who are ignoring the way the country is heading:

“We need to basically broaden the base, we need to have more women, we need to have more Latinos, we need to have more African-Americans.”

Good luck, gents. Most American women are pretty keen on getting equal pay for equal work, now made easier by the 2009 Lilly Ledbetter Act. Paul Ryan, along with most Republicans in the House of Representatives, voted against it. Women also want to be in charge of their, you know, lady-parts. Yet Republican-controlled state legislatures have tripped over themselves to introduce laws forcing women seeking an abortion to undergo transvaginal ultrasounds to get, as one pious supporter called it, “a window into her womb”. This year’s Republican platform document declares that since “life” begins at the nanosecond of conception, abortion is verboten – even if the woman has been raped, even if carrying a pregnancy to term would jeopardise her health. Zygotes: good. Women wielding vaginas: bad.

Republicans wonder why “family values”-loving Latinos favor godless, gay-marriage-promoting Democrats over them. Surely, it can’t just be because conservatives loudly disparage Latino language and culture, denounce the Dream Act, defend the indefensible Sheriff Joe “Mexicans are dirty” Arpaio, and see nothing wrong with a little racial profiling (in 2010, a California congressman confidently asserted that he could identify the undocumented by their shoes) is no reason not to sign up.

And why are black folks so perversely resistant to joining the party of Abraham Lincoln? Could it be because it’s also the party of Richard Nixon, whose “Southern Strategy” exploited fear of integration to transform the Republicans from a socially progressive (if fiscally conservative) party into a paranoid, racist-dogwhistling bunch of pro-gun, anti-science, anti-government fundamentalists whose political base is circling the wagons in the Old Confederacy? Could it be those Romney campaign ads with all the industrious white folks which state, wrongly, that Obama waived the work requirement for welfare?

Or could it be the way even the so-called adults of the Republican party have tolerated and sometimes encouraged the constant birtherism of their Tea Party-infused co-religionists? Donald Trump’s absurd assurances that Barack Obama’s birth certificate is fake, Mitt Romney’s birth certificate “joke”, the bullfrog chorus of Republicans from John Sununu to Sarah Palin repeatedly croaking that Obama is a socialist/radical/elitist hell-bent on transforming America into France all sound like code for “Oh God! He’s a Negro!” CNN presenter Soledad O’Brien put this to a Tea Party leader who dismissed it. She simply“doesn’t believe that he loves America the way that we do”.

Every time Republicans seem to be making at least cosmetic progress toward inclusiveness, some old white guy shows up and tears off the mask of tolerance: Clint Eastwood talking to an imaginary (though angry and profane) black man in front of millions of people; an apparently-mummified Chuck Norris and his pale wife warning that if Obama is re-elected, your children face “1,000 years of darkness”.

This is what happens when you wrap yourself in the flag so tightly that oxygen can’t get to your brain. This is what happens when you want to “take America back”. Back to when?

 
Leave a comment

Posted by on September 10, 2012 in African American News

 

Tags: , ,

Paul Ryan and the ‘scary’ future of public education in America

By Ann-Marie Adams

There’s something about Paul Ryan that scares the bejeezus out of some black people.

A recent NBC/Wall Street poll confirmed zero percent black support for Mitt Romney and his vice presidential pick (A Washington Post poll found that 4 percent of registered African Americans would vote for the GOP ticket). Romney was already scary all by himself with his “corporations are people, too” mindset. But when he tapped Ryan, who crafted a draconian budget to target social services and education, many people – black and white – let out a collective gasp.

A self-professed defense hawk, Ryan plans to dump more money into defense spending and give “job creators” money taken from already poor and debt-ridden Americans. University of California-Berkeley Professor Robert Reich simplifies the warped logic that undergirds the Ryan-Romney budget in this video

Ryan-Romney plans to cut Pell Grants by $850 per studental almost nixing President Barack Obama’s increase of $1,000. Decreased Pell Grants equal more student loans with high interest rates. That means most people will have more debt load while unemployed. If unemployed more than one year, you can’t pay bills, which prompts a decrease in credit scores. Employers could deny you a job because of long-term unemployment and bad credit scores. To date, the Romney-Ryan team has no jobs plan for the educated and unemployed, just economic prosperity for the one percent.

For the rest of us, there is a hint of danger lurking behind Ryan’s Cheshire smile and hyper-conservative rhetoric. The gnawing feeling was deep enough to signal that a Romney-Ryan team in the White House means deep and dire distress.

Parse Ryan’s acceptance speech about his party’s plan for prosperity, and you’ll find many clues. One of his most pertinent proclamations came two weeks after President Obama signed an Executive Order to improve outcomes and advance educational opportunities for blacks.

Flanked by black leaders who have championed quality education for all, Obama recently signed another promissory note that acknowledged “substantial obstacles to equal educational opportunity still remain in America’s educational systems” despite incremental progress since the 1954, Brown v. Board of Education. The Order, similar to one signed by former presidents, George Bush and Bill Clinton, for Hispanics, states that improving education would significantly improve educational outcomes for blacks and will deliver economic benefits for America by increasing college rates and productivity.

Two weeks after this Order, Ryan in a speech said: “We will give equal opportunity but not equal outcome.”

Pause. Wasn’t that memo sent out more than two centuries ago?

It seems Vice President Joe Biden was not far-fetched in his assessment that the Romney-Ryan ticket wants to put black folk in chains again.

That’s because Ryan echoed the same sentiment enmeshed in the Declaration of Independence and many other noble plans for prosperity in this country. America’s promise of equality, justice and the pursuit of happiness was a hallowed one for many poor and enslaved during the eighteenth century. And so many Americans could not pursue their happiness because they were, well, um, in chains.

Another memo was sent out in 1863, the Emancipation Proclamation. It prohibited forced free labor. But during the second half of the nineteenth century, peonage was slavery by another name. In the first half of the twentieth century, Jim Crow was its cousin. So in 1954, America gave us another memo that told us separate was not equal and that it was just another barrier in the pursuit of happiness for many Americans. And just last month, Obama added yet another memo, so that our school system can ensure equitable access to a quality education to all because in 2012 the road for many black and Latino children is from schools to prisons.

Because of the contradictions and constraints facing the ideal of American democracy, there’s a constant need to stress equal access, which means having the same level of quality educational services offered to most in the dominant group. Obama’s executive order is to ensure there are no man-made barriers based on prejudice, xenophobia, nativism, or racism.

And unless you’ve been living under a proverbial rock, you will know that road to prosperity has always been laden with higher hurdles for people of color. So Ryan’s promise of equal opportunity, but not equal outcome, hints at many more hurdles to come.

Obama’s July 26 Order delineates the existing hurdles: Blacks lack quality access to highly effective teachers and principals, safe schools and challenging college-preparatory classes. They also disproportionately experience school discipline and referrals to special education. Additionally, many blacks do not graduate with a regular high school diploma. But they experience disproportionate rates of incarceration.

So a quality education, despite news to the contrary for many unemployed blacks today, is still a ticket to social mobility. Obama’s executive order, albeit in an election year, inches along the path to fulfilling a long-held covenant to provide quality education to all.

To the NAACP and other community-based organizations nationwide, the order was a move towards “intentional focus” on serving students of color well and meeting the millennium goal of producing more college graduates to compete globally, said Beth Glenn, NAACP’s Director of Education.

“This sends a strong signal to community based organizations that [Obama] wants to work with communities most impacted,” Glenn said.

While Glenn and others are working on that goal, we must equip ourselves for a possible Romney-Ryan administration and their plan for education because you can’t have prosperity without an educated and skilled populace. And we definitely don’t need extra hurdles in our path toward equal outcomes.

Ann-Marie Adams is a race and education contributor to The RootDC. She is the founder of a hyper-local news site The Hartford Guardian, which builds urban communities through civic journalism. Follow her on twitter at @annmarieadams.

 
Leave a comment

Posted by on August 31, 2012 in African American Politics

 

Tags: ,

Paul Ryan, A Lie, Is A Lie, Is A Lie

Paul Ryan SpeechAs soon as Paul Ryan (pictured) was officially unveiled as Mitt Romney’s choice for vice president, conservatives swarmed in to set the narrative that the Wisconsin congressman was a serious thinker of great integrity, audacious enough to give the country the hard truths in order to save the very idea of America. How successful have they been at storytelling? In the latest national survey by the Pew Research Center and the Washington Post, conducted August 23-29, “of those offering a word, 37 percent describe Ryan in clearly positive terms, using such words as intelligentgoodenergetichonest, and smart.” On the other hand, “another 35 percent of the words used are clearly negative in tone, such as idiotextremephony, and scary.”

After watching Paul Ryan formally accept the Republican nomination for Vice President, I implore each of you to go with the more skeptical bunch polled.

I’ll refrain from calling him an “idiot,” but he doesn’t appear to be as great a thinker as he fancies himself to be. Moreover, Ryan’s views are very much extreme and scary, and based on the way he told lie after lie about President Barack Obama while failing to disclose his own congressional past, he is every bit the phony.

 

That’s why it was a bit frustrating Wednesday night to watch certain political commentators stress the “effectiveness” of his speech instead of highlight the numerous fallacies that made up its content. Fortunately, a sea of writers and various news outlets have countered chatter about tone and instead shifted to conversations as to whether Ryan told the truth during his RNC speech.

The Associated Press claimed Paul Ryan took “factual shortcuts” throughout his speech. A Slate writer opted to use the word “fibs” to describe Ryan’s inaccurate claims about the president. CNN used “Ryan misleads” to describe our next potential VP’s summation of the bipartisan debt commission and the overall failure for the Simpson-Bowles plan to be implemented. A New Republic headline about Ryan’s big debut is “The Most Dishonest Convention Speech … Ever?” Even FOX News writer and contributor Sally Kohn described the speech as “dazzling, deceiving, and distracting.”

The Washington Post‘s Jonathan Bernstein has been the frankest, though:

But really, the proper response to a speech like this isn’t to carefully analyze the logic, or to find instances of hypocrisy; it’s to call the speaker out for telling flat-out lies to the American people. Paul Ryan has had what I’ve long thought was an undeserved good reputation among many in the press and in Washington. It shouldn’t survive tonight’s speech.

Yes, let’s not pussyfoot about this: Paul Ryan is a liar. A politician lying isn’t especially shocking, but some are far more brazen about it than others.

Here are the biggest lies Ryan told last night:

  • Paul Ryan lied when he said, “[Obama has] more debt than any other president before him, and more than all the troubled governments of Europe combined.” That’s a lie once told by Mitt Romney that was debunked nearly a year ago.
  • Paul Ryan lied when he said President Obama’s health care law funnels money away from Medicare “at the expense of the elderly.” Actually, it’s been found that the law “substantially improves” the system’s finances. Not to mention “Ryan himself has embraced the same savings.”
  • One of Ryan’s biggest lies of the night was him declaring, “The truest measure of any society is how it treats those who cannot defend or care for themselves.” Has he read his own budget? The traveling nuns spreading the word about Paul Ryan’s desire to substantially slash funds for social programs designed to aid the poor have.
  • The other grand lie of the night was when Ryan said, “He [President Obama] created a bipartisan debt commission. They came back with an urgent report. He thanked them, sent them on their way, and then did exactly nothing.”

    Though the president didn’t embrace every point of the plan, he did support key measures of it. Not that it mattered given that Ryan, who sat on the budget committee, led the effort to vote the plan down. Like Sen. Mitch McConnell (R-Ky), Ryan was more interested in making it harder for President Obama to get re-elected than making it easier for the United States to get its finances in order. Zoom, look at the “budget hawk” go.

So as fate would have it, the man who declared on stage, “We will not duck the tough issues; we will lead,” ducked the issues by denying his own role in the country’s stagnant economic recovery and shying away from detailing his controversial views on taxes, abortion, Medicare, economic inequality, and every other issue that would have easily had voters look beyond those “piercing blue eyes” his supporters love to openly swoon over and see him for exactly who he is.

Paul Ryan is as much a face for honesty as Chris Christie embodies the Weight Watchers diet plan. He is nowhere near as politically brave as purported to be. Hopefully, the more he talks the more his lies are exposed and voters judge he and Mitt Romney accordingly.

Watch Paul Ryan’s Pinocchio speech here: http://www.cbsnews.com/video/watch/?id=7419860n

Michael Arceneaux is a Houston-bred, Howard-educated writer and blogger. You can read more of his work on his site, The Cynical Ones. Follow him on Twitter: @youngsinick

 
Leave a comment

Posted by on August 30, 2012 in African American News

 

Tags: , , ,

Greed and Debt: The True Story of Mitt Romney and Bain Capital

How the GOP presidential candidate and his private equity firm staged an epic wealth grab, destroyed jobs – and stuck others with the bill

Mitt Romney illustration

Illustration by Robert Grossman

 

 

by: Matt Taibbi

The great criticism of Mitt Romney, from both sides of the aisle, has always been that he doesn’t stand for anything. He’s a flip-flopper, they say, a lightweight, a cardboard opportunist who’ll say anything to get elected.

 

The critics couldn’t be more wrong. Mitt Romney is no tissue-paper man. He’s closer to being a revolutionary, a backward-world version of Che or Trotsky, with tweezed nostrils instead of a beard, a half-Windsor instead of a leather jerkin. His legendary flip-flops aren’t the lies of a bumbling opportunist – they’re the confident prevarications of a man untroubled by misleading the nonbeliever in pursuit of a single, all-consuming goal. Romney has a vision, and he’s trying for something big: We’ve just been too slow to sort out what it is, just as we’ve been slow to grasp the roots of the radical economic changes that have swept the country in the last generation.

 

The incredible untold story of the 2012 election so far is that Romney’s run has been a shimmering pearl of perfect political hypocrisy, which he’s somehow managed to keep hidden, even with thousands of cameras following his every move. And the drama of this rhetorical high-wire act was ratcheted up even further when Romney chose his running mate, Rep. Paul Ryan of Wisconsin – like himself, a self-righteously anal, thin-lipped, Whitest Kids U Know penny pincher who’d be honored to tell Oliver Twist there’s no more soup left. By selecting Ryan, Romney, the hard-charging, chameleonic champion of a disgraced-yet-defiant Wall Street, officially succeeded in moving the battle lines in the 2012 presidential race.

 

 

Like John McCain four years before, Romney desperately needed a vice-presidential pick that would change the game. But where McCain bet on a combustive mix of clueless novelty and suburban sexual tension named Sarah Palin, Romney bet on an idea. He said as much when he unveiled his choice of Ryan, the author of a hair-raising budget-cutting plan best known for its willingness to slash the sacred cows of Medicare and Medicaid. “Paul Ryan has become an intellectual leader of the Republican Party,” Romney told frenzied Republican supporters in Norfolk, Virginia, standing before the reliably jingoistic backdrop of a floating warship. “He understands the fiscal challenges facing America: our exploding deficits and crushing debt.”

 

Debt, debt, debt. If the Republican Party had a James Carville, this is what he would have said to win Mitt over, in whatever late-night war room session led to the Ryan pick: “It’s the debt, stupid.” This is the way to defeat Barack Obama: to recast the race as a jeremiad against debt, something just about everybody who’s ever gotten a bill in the mail hates on a primal level.

 

Last May, in a much-touted speech in Iowa, Romney used language that was literally inflammatory to describe America’s federal borrowing. “A prairie fire of debt is sweeping across Iowa and our nation,” he declared. “Every day we fail to act, that fire gets closer to the homes and children we love.” Our collective debt is no ordinary problem: According to Mitt, it’s going to burn our children alive.

 

And this is where we get to the hypocrisy at the heart of Mitt Romney. Everyone knows that he is fantastically rich, having scored great success, the legend goes, as a “turnaround specialist,” a shrewd financial operator who revived moribund companies as a high-priced consultant for a storied Wall Street private equity firm. But 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.

 

By making debt the centerpiece of his campaign, Romney was making a calculated bluff of historic dimensions – placing a massive all-in bet on the rank incompetence of the American press corps. The result has been a brilliant comedy: A man makes a $250 million fortune loading up companies with debt and then extracting million-dollar fees from those same companies, in exchange for the generous service of telling them who needs to be fired in order to finance the debt payments he saddled them with in the first place. That same man then runs for president riding an image of children roasting on flames of debt, choosing as his running mate perhaps the only politician in America more pompous and self-righteous on the subject of the evils of borrowed money than the candidate himself. If Romney pulls off this whopper, you’ll have to tip your hat to him: No one in history has ever successfully run for president riding this big of a lie. It’s almost enough to make you think he really is qualified for the White House.

 

The unlikeliness of Romney’s gambit isn’t simply a reflection of his own artlessly unapologetic mindset – it stands as an emblem for the resiliency of the entire sociopathic Wall Street set he represents. Four years ago, the Mitt Romneys of the world nearly destroyed the global economy with their greed, shortsightedness and – most notably – wildly irresponsible use of debt in pursuit of personal profit. The sight was so disgusting that people everywhere were ready to drop an H-bomb on Lower Manhattan and bayonet the survivors. But today that same insane greed ethos, that same belief in the lunatic pursuit of instant borrowed millions – it’s dusted itself off, it’s had a shave and a shoeshine, and it’s back out there running for president.

 

Mitt Romney, it turns out, is the perfect frontman for Wall Street’s greed revolution. He’s not a two-bit, shifty-eyed huckster like Lloyd Blankfein. He’s not a sighing, eye-rolling, arrogant jerkwad like Jamie Dimon. But Mitt believes the same things those guys believe: He’s been right with them on the front lines of the financialization revolution, a decades-long campaign in which the old, simple, let’s-make-stuff-and-sell-it manufacturing economy was replaced with a new, highly complex, let’s-take-stuff-and-trash-it financial economy. Instead of cars and airplanes, we built swaps, CDOs and other toxic financial products. Instead of building new companies from the ground up, we took out massive bank loans and used them to acquire existing firms, liquidating every asset in sight and leaving the target companies holding the note. The new borrow-and-conquer economy was morally sanctified by an almost religious faith in the grossly euphemistic concept of “creative destruction,” and amounted to a total abdication of collective responsibility by America’s rich, whose new thing was making assloads of money in ever-shorter campaigns of economic conquest, sending the proceeds offshore, and shrugging as the great towns and factories their parents and grandparents built were shuttered and boarded up, crushed by a true prairie fire of debt.

 

Mitt Romney – a man whose own father built cars and nurtured communities, and was one of the old-school industrial anachronisms pushed aside by the new generation’s wealth grab – has emerged now to sell this make-nothing, take-everything, screw-everyone ethos to the world. He’s Gordon Gekko, but a new and improved version, with better PR – and a bigger goal. A takeover artist all his life, Romney is now trying to take over America itself. And if his own history is any guide, we’ll all end up paying for the acquisition.

Willard “Mitt” Romney’s background in many ways suggests a man who was born to be president – disgustingly rich from birth, raised in prep schools, no early exposure to minorities outside of maids, a powerful daddy to clean up his missteps, and timely exemptions from military service. In Romney’s bio there are some eerie early-life similarities to other recent presidential figures. (Is America really ready for another Republican president who was a prep-school cheerleader?) And like other great presidential double-talkers such as Bill Clinton and George W. Bush, Romney has shown particular aptitude in the area of telling multiple factual versions of his own life story.

 

“I longed in many respects to actually be in Vietnam and be representing our country there,” he claimed years after the war. To a different audience, he said, “I was not planning on signing up for the military. It was not my desire to go off and serve in Vietnam.”

 

Like John F. Kennedy and George W. Bush, men whose way into power was smoothed by celebrity fathers but who rebelled against their parental legacy as mature politicians, Mitt Romney’s career has been both a tribute to and a repudiation of his famous father. George Romney in the 1950s became CEO of American Motors Corp., made a modest fortune betting on energy efficiency in an age of gas guzzlers and ended up serving as governor of the state of Michigan only two generations removed from the Romney clan’s tradition of polygamy. For Mitt, who grew up worshipping his tall, craggily handsome, politically moderate father, life was less rocky: Cranbrook prep school in suburban Detroit, followed by Stanford in the Sixties, a missionary term in which he spent two and a half years trying (as he said) to persuade the French to “give up your wine,” and Harvard Business School in the Seventies. Then, faced with making a career choice, Mitt chose an odd one: Already married and a father of two, he left Harvard and eschewed both politics and the law to enter the at-the-time unsexy world of financial consulting.

 

“When you get out of a place like Harvard, you can do anything – at least in the old days you could,” says a prominent corporate lawyer on Wall Street who is familiar with Romney’s career. “But he comes out, he not only has a Harvard Business School degree, he’s got a national pedigree with his name. He could have done anything – but what does he do? He says, ‘I’m going to spend my life loading up distressed companies with debt.’ ”

 

Romney started off at the Boston Consulting Group, where he showed an aptitude for crunching numbers and glad-handing clients. Then, in 1977, he joined a young entrepreneur named Bill Bain at a firm called Bain & Company, where he worked for six years before being handed the reins of a new firm-within-a-firm called Bain Capital.

 

In Romney’s version of the tale, Bain Capital – which evolved into what is today known as a private equity firm – specialized in turning around moribund companies (Romney even wrote a book called Turnaround that complements his other nauseatingly self-complimentary book, No Apology) and helped create the Staples office-supply chain. On the campaign trail, Romney relentlessly trades on his own self-perpetuated reputation as a kind of altruistic rescuer of failing enterprises, never missing an opportunity to use the word “help” or “helped” in his description of what he and Bain did for companies. He might, for instance, describe himself as having been “deeply involved in helping other businesses” or say he “helped create tens of thousands of jobs.”

 

The reality is that toward the middle of his career at Bain, Romney made a fateful strategic decision: He moved away from creating companies like Staples through venture capital schemes, and toward a business model that involved borrowing huge sums of money to take over existing firms, then extracting value from them by force. He decided, as he later put it, that “there’s a lot greater risk in a startup than there is in acquiring an existing company.” In the Eighties, when Romney made this move, this form of financial piracy became known as a leveraged buyout, and it achieved iconic status thanks to Gordon Gekko in Wall Street. Gekko’s business strategy was essentially identical to the Romney–Bain model, only Gekko called himself a “liberator” of companies instead of a “helper.”

 

Here’s how Romney would go about “liberating” a company: A private equity firm like Bain typically seeks out floundering businesses with good cash flows. It then puts down a relatively small amount of its own money and runs to a big bank like Goldman Sachs or Citigroup for the rest of the financing. (Most leveraged buyouts are financed with 60 to 90 percent borrowed cash.) The takeover firm then uses that borrowed money to buy a controlling stake in the target company, either with or without its consent. When an LBO is done without the consent of the target, it’s called a hostile takeover; such thrilling acts of corporate piracy were made legend in the Eighties, most notably the 1988 attack by notorious corporate raiders Kohlberg Kravis Roberts against RJR Nabisco, a deal memorialized in the book Barbarians at the Gate.

 

Romney and Bain avoided the hostile approach, preferring to secure the cooperation of their takeover targets by buying off a company’s management with lucrative bonuses. Once management is on board, the rest is just math. So if the target company is worth $500 million, Bain might put down $20 million of its own cash, then borrow $350 million from an investment bank to take over a controlling stake.

 

But here’s the catch. When Bain borrows all of that money from the bank, it’s the target company that ends up on the hook for all of the debt.

 

Now your troubled firm – let’s say you make tricycles in Alabama – has been taken over by a bunch of slick Wall Street dudes who kicked in as little as five percent as a down payment. So in addition to whatever problems you had before, Tricycle Inc. now owes Goldman or Citigroup $350 million. With all that new debt service to pay, the company’s bottom line is suddenly untenable: You almost have to start firing people immediately just to get your costs down to a manageable level.

 

“That interest,” says Lynn Turner, former chief accountant of the Securities and Exchange Commission, “just sucks the profit out of the company.”

Fortunately, the geniuses at Bain who now run the place are there to help tell you whom to fire. And for the service it performs cutting your company’s costs to help you pay off the massive debt that it, Bain, saddled your company with in the first place, Bain naturally charges a management fee, typically millions of dollars a year. So Tricycle Inc. now has two gigantic new burdens it never had before Bain Capital stepped into the picture: tens of millions in annual debt service, and millions more in “management fees.” Since the initial acquisition of Tricycle Inc. was probably greased by promising the company’s upper management lucrative bonuses, all that pain inevitably comes out of just one place: the benefits and payroll of the hourly workforce.

 

Once all that debt is added, one of two things can happen. The company can fire workers and slash benefits to pay off all its new obligations to Goldman Sachs and Bain, leaving it ripe to be resold by Bain at a huge profit. Or it can go bankrupt – this happens after about seven percent of all private equity buyouts – leaving behind one or more shuttered factory towns. Either way, Bain wins. By power-sucking cash value from even the most rapidly dying firms, private equity raiders like Bain almost always get their cash out before a target goes belly up.

 

This business model wasn’t really “helping,” of course – and it wasn’t new. Fans of mob movies will recognize what’s known as the “bust-out,” in which a gangster takes over a restaurant or sporting goods store and then monetizes his investment by running up giant debts on the company’s credit line. (Think Paulie buying all those cases of Cutty Sark in Goodfellas.) When the note comes due, the mobster simply torches the restaurant and collects the insurance money. Reduced to their most basic level, the leveraged buyouts engineered by Romney followed exactly the same business model. “It’s the bust-out,” one Wall Street trader says with a laugh. “That’s all it is.”

 

Private equity firms aren’t necessarily evil by definition. There are many stories of successful turnarounds fueled by private equity, often involving multiple floundering businesses that are rolled into a single entity, eliminating duplicative overhead. Experian, the giant credit-rating tyrant, was acquired by Bain in the Nineties and went on to become an industry leader.

 

But there’s a key difference between private equity firms and the businesses that were America’s original industrial cornerstones, like the elder Romney’s AMC. Everyone had a stake in the success of those old businesses, which spread prosperity by putting people to work. But even private equity’s most enthusiastic adherents have difficulty explaining its benefit to society. Marc Wolpow, a former Bain colleague of Romney’s, told reporters during Mitt’s first Senate run that Romney erred in trying to sell his business as good for everyone. “I believed he was making a mistake by framing himself as a job creator,” said Wolpow. “That was not his or Bain’s or the industry’s primary objective. The objective of the LBO business is maximizing returns for investors.” When it comes to private equity, American workers – not to mention their families and communities – simply don’t enter into the equation.

 

Take a typical Bain transaction involving an Indiana-based company called American Pad and Paper. Bain bought Ampad in 1992 for just $5 million, financing the rest of the deal with borrowed cash. Within three years, Ampad was paying $60 million in annual debt payments, plus an additional $7 million in management fees. A year later, Bain led Ampad to go public, cashed out about $50 million in stock for itself and its investors, charged the firm $2 million for arranging the IPO and pocketed another $5 million in “management” fees. Ampad wound up going bankrupt, and hundreds of workers lost their jobs, but Bain and Romney weren’t crying: They’d made more than $100 million on a $5 million investment.

 

To recap: Romney, who has compared the devilish federal debt to a “nightmare” home mortgage that is “adjustable, no-money down and assigned to our children,” took over Ampad with essentially no money down, saddled the firm with a nightmare debt and assigned the crushing interest payments not to Bain but to the children of Ampad’s workers, who would be left holding the note long after Romney fled the scene. The mortgage analogy is so obvious, in fact, that even Romney himself has made it. He once described Bain’s debt-fueled strategy as “using the equivalent of a mortgage to leverage up our investment.”

 

Romney has always kept his distance from the real-life consequences of his profiteering. At one point during Bain’s looting of Ampad, a worker named Randy Johnson sent a handwritten letter to Romney, asking him to intervene to save an Ampad factory in Marion, Indiana. In a sterling demonstration of manliness and willingness to face a difficult conversation, Romney, who had just lost his race for the Senate in Massachusetts, wrote Johnson that he was “sorry,” but his lawyers had advised him not to get involved. (So much for the candidate who insists that his way is always to “fight to save every job.”)

 

This is typical Romney, who consistently adopts a public posture of having been above the fray, with no blood on his hands from any of the deals he personally engineered. “I never actually ran one of our investments,” he says in Turnaround. “That was left to management.”

 

In reality, though, Romney was unquestionably the decider at Bain. “I insisted on having almost dictatorial powers,” he bragged years after the Ampad deal. Over the years, colleagues would anonymously whisper stories about Mitt the Boss to the press, describing him as cunning, manipulative and a little bit nuts, with “an ability to identify people’s insecurities and exploit them for his own benefit.” One former Bain employee said that Romney would screw around with bonuses in small amounts, just to mess with people: He would give $3 million to one, $3.1 million to another and $2.9 million to a third, just to keep those below him on edge.

 

The private equity business in the early Nineties was dominated by a handful of takeover firms, from the spooky and politically connected Carlyle Group (a favorite subject of conspiracy-theory lit, with its connections to right-wingers like Donald Rumsfeld and George H.W. Bush) to the equally spooky Democrat-leaning assholes at the Blackstone Group. But even among such a colorful cast of characters, Bain had a reputation on Wall Street for secrecy and extreme weirdness – “the KGB of consulting.” Its employees, known for their Mormonish uniform of white shirts and red power ties, were dubbed “Bainies” by other Wall Streeters, a rip on the fanatical “Moonies.” The firm earned the name thanks to its idiotically adolescent Spy Kids culture, in which these glorified slumlords used code names, didn’t carry business cards and even sang “company songs” to boost morale.

 

The seemingly religious flavor of Bain’s culture smacks of the generally cultish ethos on Wall Street, in which all sorts of ethically questionable behaviors are justified as being necessary in service of the church of making money. Romney belongs to a true-believer subset within that cult, with a revolutionary’s faith in the wisdom of the pure free market, in which destroying companies and sucking the value out of them for personal gain is part of the greater good, and governments should “stand aside and allow the creative destruction inherent in the free economy.”

 

That cultlike zeal helps explains why Romney takes such a curiously unapologetic approach to his own flip-flopping. His infamous changes of stance are not little wispy ideological alterations of a few degrees here or there – they are perfect and absolute mathematical reversals, as in “I believe that abortion should be safe and legal in this country” and “I am firmly pro-life.” Yet unlike other politicians, who at least recognize that saying completely contradictory things presents a political problem, Romney seems genuinely puzzled by the public’s insistence that he be consistent. “I’m not going to apologize for having changed my mind,” he likes to say. It’s an attitude that recalls the standard defense offered by Wall Street in the wake of some of its most recent and notorious crimes: Goldman Sachs excused its lying to clients, for example, by insisting that its customers are “sophisticated investors” who should expect to be lied to. “Last time I checked,” former Morgan Stanley CEO John Mack sneered after the same scandal, “we were in business to be profitable.”

 

Within the cult of Wall Street that forged Mitt Romney, making money justifies any behavior, no matter how venal. The look on Romney’s face when he refuses to apologize says it all: Hey, I’m trying to win an election. We’re all grown-ups here. After the Ampad deal, Romney expressed contempt for critics who lived in “fantasy land.” “This is the real world,” he said, “and in the real world there is nothing wrong with companies trying to compete, trying to stay alive, trying to make money.”

 

In the old days, making money required sharing the wealth: with assembly-line workers, with middle management, with schools and communities, with investors. Even the Gilded Age robber barons, despite their unapologetic efforts to keep workers from getting any rights at all, built America in spite of themselves, erecting railroads and oil wells and telegraph wires. And from the time the monopolists were reined in with antitrust laws through the days when men like Mitt Romney’s dad exited center stage in our economy, the American social contract was pretty consistent: The rich got to stay rich, often filthy rich, but they paid taxes and a living wage and everyone else rose at least a little bit along with them.

 

But under Romney’s business model, leveraging other people’s debt means you can carve out big profits for yourself and leave everyone else holding the bag. Despite what Romney claims, the rate of return he provided for Bain’s investors over the years wasn’t all that great. Romney biographer and Wall Street Journal reporter Brett Arends, who analyzed Bain’s performance between 1984 and 1998, concludes that the firm’s returns were likely less than 30 percent per year, which happened to track more or less with the stock market’s average during that time. “That’s how much money you could have made by issuing company bonds and then spending the money picking stocks out of the paper at random,” Arends observes. So for all the destruction Romney wreaked on Middle America in the name of “trying to make money,” investors could have just plunked their money into traditional stocks and gotten pretty much the same returns.

 

The only ones who profited in a big way from all the job-killing debt that Romney leveraged were Mitt and his buddies at Bain, along with Wall Street firms like Goldman and Citigroup. Barry Ritholtz, author of Bailout Nation, says the criticisms of Bain about layoffs and meanness miss a more important point, which is that the firm’s profit-producing record is absurdly mediocre, especially when set against all the trouble and pain its business model causes. “Bain’s fundamental flaw, at least according to the math,” Ritholtz writes, “is that they took lots of risk, use immense leverage and charged enormous fees, for performance that was more or less the same as [stock] indexing.”

 

‘I’m not a Romney guy, because I’m not a Bain guy,” says Lenny Patnode, in an Irish pub in the factory town of Pittsfield, Massachusetts. “But I’m not an Obama guy, either. Just so you know.”

 

I feel bad even asking Patnode about Romney. Big and burly, with white hair and the thick forearms of a man who’s stocked a shelf or two in his lifetime, he seems to belong to an era before things like leveraged debt even existed. For 38 years, Patnode worked for a company called KB Toys in Pittsfield. He was the longest-serving employee in the company’s history, opening some of the firm’s first mall stores, making some of its canniest product buys (“Tamagotchi pets,” he says, beaming, “and Tech-Decks, too”), traveling all over the world to help build an empire that at its peak included 1,300 stores. “There were times when I worked seven days a week, 16 hours a day,” he says. “I opened three stores in two months once.”

 

Then in 2000, right before Romney gave up his ownership stake in Bain Capital, the firm targeted KB Toys. The debacle that followed serves as a prime example of the conflict between the old model of American business, built from the ground up with sweat and industry know-how, and the new globalist model, the Romney model, which uses leverage as a weapon of high-speed conquest.

 

In a typical private-equity fragging, Bain put up a mere $18 million to acquire KB Toys and got big banks to finance the remaining $302 million it needed. Less than a year and a half after the purchase, Bain decided to give itself a gift known as a “dividend recapitalization.” The firm induced KB Toys to redeem $121 million in stock and take out more than $66 million in bank loans – $83 million of which went directly into the pockets of Bain’s owners and investors, including Romney. “The dividend recap is like borrowing someone else’s credit card to take out a cash advance, and then leaving them to pay it off,” says Heather Slavkin Corzo, who monitors private equity takeovers as the senior legal policy adviser for the AFL-CIO.

 

Bain ended up earning a return of at least 370 percent on the deal, while KB Toys fell into bankruptcy, saddled with millions in debt. KB’s former parent company, Big Lots, alleged in bankruptcy court that Bain’s “unjustified” return on the dividend recap was actually “900 percent in a mere 16 months.” Patnode, by contrast, was fired in December 2008, after almost four decades on the job. Like other employees, he didn’t get a single day’s severance.

 

I ask Slavkin Corzo what Bain’s justification was for the giant dividend recapitalization in the KB Toys acquisition. The question throws her, as though she’s surprised anyone would ask for a reason a company like Bain would loot a firm like KB Toys. “It wasn’t like, ‘Yay, we did a good job, we get a dividend,'” she says with a laugh. “It was like, ‘We can do this, so we will.’ ”

 

At the time of the KB Toys deal, Romney was a Bain investor and owner, making him a mere beneficiary of the raping and pillaging, rather than its direct organizer. Moreover, KB’s demise was hastened by a host of genuine market forces, including competition from video games and cellphones. But there’s absolutely no way to look at what Bain did at KB and see anything but a cash grab – one that followed the business model laid out by Romney. Rather than cutting costs and tightening belts, Bain added $300 million in debt to the firm’s bottom line while taking out more than $120 million in cash – an outright looting that creditors later described in a lawsuit as “breaking open the piggy bank.” What’s more, Bain smoothed the deal in typical fashion by giving huge bonuses to the company’s top managers as the firm headed toward bankruptcy. CEO Michael Glazer got an incredible $18.4 million, while CFO Robert Feldman received $4.8 million and senior VP Thomas Alfonsi took home $3.3 million.

 

And what did Bain bring to the table in return for its massive, outsize payout? KB Toys had built a small empire by targeting middle-class buyers with value-priced products. It succeeded mainly because the firm’s leaders had a great instinct for what they were making and selling. These were people who had been in the specialty toy business since 1922; collectively, they had millions of man-hours of knowledge about how the industry works and how toy customers behave. KB’s president in the Eighties, the late Saul Rubenstein, used to carry around a giant computer printout of the company’s inventory, and would fall asleep reading it on the weekends, the pages clasped to his chest. “He knew the name and number of all those toys,” his widow, Shirley, says proudly. “He loved toys.”

 

Bain’s experience in the toy industry, by contrast, was precisely bupkus. They didn’t know a damn thing about the business they had taken over – and they never cared to learn. The firm’s entire contribution was $18 million in cash and a huge mound of borrowed money that gave it the power to pull the levers. “The people who came in after – they were never toy people,” says Shirley Rubenstein. To make matters worse, former employees say, Bain deluged them with requests for paperwork and reports, forcing them to worry more about the whims of their new bosses than the demands of their customers. “We took our eye off the ball,” Patnode says. “And if you take your eye off the ball, you strike out.”

 

In the end, Bain never bothered to come up with a plan for how KB Toys could meet the 21st-century challenges of video games and cellphone gadgets that were the company’s ostensible downfall. And that’s where Romney’s self-touted reputation as a turnaround specialist is a myth. In the Bain model, the actual turnaround isn’t necessary. It’s just a cover story. It’s nice for the private equity firm if it happens, because it makes the acquired company more attractive for resale or an IPO. But it’s mostly irrelevant to the success of the takeover model, where huge cash returns are extracted whether the captured firm thrives or not.

 

“The thing about it is, nobody gets hurt,” says Patnode. “Except the people who worked here.”

 

Romney was a prime mover in the radical social and political transformation that was cooked up by Wall Street beginning in the 1980s. In fact, you can trace the whole history of the modern age of financialization just by following the highly specific corner of the economic universe inhabited by the leveraged buyout business, where Mitt Romney thrived. If you look at the number of leveraged buyouts dating back two or three decades, you see a clear pattern: Takeovers rose sharply with each of Wall Street’s great easy-money schemes, then plummeted just as sharply after each of those scams crashed and burned, leaving the rest of us with the bill.

 

In the Eighties, when Romney and Bain were cutting their teeth in the LBO business, the primary magic trick involved the junk bonds pioneered by convicted felon Mike Milken, which allowed firms like Bain to find easy financing for takeovers by using wildly overpriced distressed corporate bonds as collateral. Junk bonds gave the Gordon Gekkos of the world sudden primacy over old-school industrial titans like the Fords and the Rockefellers: For the first time, the ability to make deals became more valuable than the ability to make stuff, and the ability to instantly engineer billions in illusory financing trumped the comparatively slow process of making and selling products for gradual returns.

Romney was right in the middle of this radical change. In fact, according to The Boston Globe – whose in-depth reporting on Romney and Bain has spanned three decades – one of Romney’s first LBO deals, and one of his most profitable, involved Mike Milken himself. Bain put down $10 million in cash, got $300 million in financing from Milken and bought a pair of department-store chains, Bealls Brothers and Palais Royal. In what should by now be a familiar outcome, the two chains – which Bain merged into a single outfit called Stage Stores – filed for bankruptcy protection in 2000 under the weight of more than $444 million in debt. As always, Bain took no responsibility for the company’s demise. (If you search the public record, you will not find a single instance of Mitt Romney taking responsibility for a company’s failure.) Instead, Bain blamed Stage’s collapse on “operating problems” that took place three years after Bain cashed out, finishing with a $175 million return on its initial investment of $10 million.

 

But here’s the interesting twist: Romney made the Bealls-Palais deal just as the federal government was launching charges of massive manipulation and insider trading against Milken and his firm, Drexel Burnham Lambert. After what must have been a lengthy and agonizing period of moral soul-searching, however, Romney decided not to kill the deal, despite its shady financing. “We did not say, ‘Oh, my goodness, Drexel has been accused of something, not been found guilty,’ ” Romney told reporters years after the deal. “Should we basically stop the transaction and blow the whole thing up?”

 

In an even more incredible disregard for basic morality, Romney forged ahead with the deal even though Milken’s case was being heard by a federal district judge named Milton Pollack, whose wife, Moselle, happened to be the chairwoman of none other than Palais Royal. In short, one of Romney’s first takeover deals was financed by dirty money – and one of the corporate chiefs about to receive a big payout from Bain was married to the judge hearing the case. Although the SEC took no formal action, it issued a sharp criticism, complaining that Romney was allowing Milken’s money to have a possible influence over “the administration of justice.”

 

After Milken and his junk bond scheme crashed in the late Eighties, Romney and other takeover artists moved on to Wall Street’s next get-rich-quick scheme: the tech-Internet stock bubble. By 1997 and 1998, there were nearly $400 billion in leveraged buyouts a year, as easy money once again gave these financial piracy firms the ammunition they needed to raid companies like KB Toys. Firms like Bain even have a colorful pirate name for the pools of takeover money they raise in advance from pension funds, university endowments and other institutional investors. “They call it dry powder,” says Slavkin Corzo, the union adviser.

 

After the Internet bubble burst and private equity started cashing in on Wall Street’s mortgage scam, LBO deals ballooned to almost $900 billion in 2006. Once again, storied companies with long histories and deep regional ties were descended upon by Bain and other pirates, saddled with hundreds of millions in debt, forced to pay huge management fees and “dividend recapitalizations,” and ridden into bankruptcy amid waves of layoffs. Established firms like Del Monte, Hertz and Dollar General were all taken over in a “prairie fire of debt” – one even more destructive than the government borrowing that Romney is flogging on the campaign trial. When Hertz was conquered in 2005 by a trio of private equity firms, including the Carlyle Group, the interest payments on its debt soared by a monstrous 80 percent, forcing the company to eliminate a third of its 32,000 jobs.

 

In 2010, a year after the last round of Hertz layoffs, Carlyle teamed up with Bain to take $500 million out of another takeover target: the parent company of Dunkin’ Donuts and Baskin-Robbins. Dunkin’ had to take out a $1.25 billion loan to pay a dividend to its new private equity owners. So think of this the next time you go to Dunkin’ Donuts for a cup of coffee: A small cup of joe costs about $1.69 in most outlets, which means that for years to come, Dunkin’ Donuts will have to sell about 2,011,834 small coffees every month – about $3.4 million – just to meet the interest payments on the loan it took out to pay Bain and Carlyle their little one-time dividend. And that doesn’t include the principal on the loan, or the additional millions in debt that Dunkin’ has to pay every year to get out from under the $2.4 billion in debt it’s now saddled with after having the privilege of being taken over – with borrowed money – by the firm that Romney built.

 

If you haven’t heard much about how takeover deals like Dunkin’ and KB Toys work, that’s because Mitt Romney and his private equity brethren don’t want you to. The new owners of American industry are the polar opposites of the Milton Hersheys and Andrew Carnegies who built this country, commercial titans who longed to leave visible legacies of their accomplishments, erecting hospitals and schools and libraries, sometimes leaving behind thriving towns that bore their names.

 

The men of the private equity generation want no such thing. “We try to hide religiously,” explained Steven Feinberg, the CEO of a takeover firm called Cerberus Capital Management that recently drove one of its targets into bankruptcy after saddling it with $2.3 billion in debt. “If anyone at Cerberus has his picture in the paper and a picture of his apartment, we will do more than fire that person,” Feinberg told shareholders in 2007. “We will kill him. The jail sentence will be worth it.”

 

Which brings us to another aspect of Romney’s business career that has largely been hidden from voters: His personal fortune would not have been possible without the direct assistance of the U.S. government. The taxpayer-funded subsidies that Romney has received go well beyond the humdrum, backdoor, welfare-sucking that all supposedly self-made free marketeers inevitably indulge in. Not that Romney hasn’t done just fine at milking the government when it suits his purposes, the most obvious instance being the incredible $1.5 billion in aid he siphoned out of the U.S. Treasury as head of the 2002 Winter Olympics in Salt Lake – a sum greater than all federal spending for the previous seven U.S. Olympic games combined. Romney, the supposed fiscal conservative, blew through an average of $625,000 in taxpayer money per athlete – an astounding increase of 5,582 percent over the $11,000 average at the 1984 games in Los Angeles. In 1993, right as he was preparing to run for the Senate, Romney also engineered a government deal worth at least $10 million for Bain’s consulting firm, when it was teetering on the edge of bankruptcy. (See “The Federal Bailout That Saved Romney,” page 52.)

 

But the way Romney most directly owes his success to the government is through the structure of the tax code. The entire business of leveraged buyouts wouldn’t be possible without a provision in the federal code that allows companies like Bain to deduct the interest on the debt they use to acquire and loot their targets. This is the same universally beloved tax deduction you can use to write off your mortgage interest payments, so tampering with it is considered political suicide – it’s been called the “third rail of tax reform.” So the Romney who routinely rails against the national debt as some kind of child-killing “mortgage” is the same man who spent decades exploiting a tax deduction specifically designed for mortgage holders in order to bilk every dollar he could out of U.S. businesses before burning them to the ground.

Because minus that tax break, Romney’s debt-based takeovers would have been unsustainably expensive. Before Lynn Turner became chief accountant of the SEC, where he reviewed filings on takeover deals, he crunched the numbers on leveraged buyouts as an accountant at a Big Four auditing firm. “In the majority of these deals,” Turner says, “the tax deduction has a big enough impact on the bottom line that the takeover wouldn’t work without it.”

 

Thanks to the tax deduction, in other words, the government actually incentivizes the kind of leverage-based takeovers that Romney built his fortune on. Romney the businessman built his career on two things that Romney the candidate decries: massive debt and dumb federal giveaways. “I don’t know what Romney would be doing but for debt and its tax-advantaged position in the tax code,” says a prominent Wall Street lawyer, “but he wouldn’t be fabulously wealthy.”

 

Adding to the hypocrisy, the money that Romney personally pocketed on Bain’s takeover deals was usually taxed not as income, but either as capital gains or as “carried interest,” both of which are capped at a maximum rate of 15 percent. In addition, reporters have uncovered plenty of evidence that Romney takes full advantage of offshore tax havens: He has an interest in at least 12 Bain funds, worth a total of $30 million, that are based in the Cayman Islands; he has reportedly used a squirrelly tax shelter known as a “blocker corporation” that cheats taxpayers out of some $100 million a year; and his wife, Ann, had a Swiss bank account worth $3 million. As a private equity pirate, Romney pays less than half the tax rate of most American executives – less, even, than teachers, firefighters, cops and nurses. Asked about the fact that he paid a tax rate of only 13.9 percent on income of $21.7 million in 2010, Romney responded testily that the massive windfall he enjoys from exploiting the tax code is “entirely legal and fair.”

 

Essentially, Romney got rich in a business that couldn’t exist without a perverse tax break, and he got to keep double his earnings because of another loophole – a pair of bureaucratic accidents that have not only teamed up to threaten us with a Mitt Romney presidency but that make future Romneys far more likely. “Those two tax rules distort the economics of private equity investments, making them much more lucrative than they should be,” says Rebecca Wilkins, senior counsel at the Center for Tax Justice. “So we get more of that activity than the market would support on its own.”

 

Listen to Mitt Romney speak, and see if you can notice what’s missing. This is a man who grew up in Michigan, went to college in California, walked door to door through the streets of southern France as a missionary and was a governor of Massachusetts, the home of perhaps the most instantly recognizable, heavily accented English this side of Edinburgh. Yet not a trace of any of these places is detectable in Romney’s diction. None of the people in any of those places bled in and left a mark on the man.

 

Romney is a man from nowhere. In his post-regional attitude, he shares something with his campaign opponent, Barack Obama, whose background is a similarly jumbled pastiche of regionally nonspecific non-identity. But in the way he bounced around the world as a half-orphaned child, Obama was more like an involuntary passenger in the demographic revolution reshaping the planet than one of its leaders.

 

Romney, on the other hand, is a perfect representative of one side of the ominous cultural divide that will define the next generation, not just here in America but all over the world. Forget about the Southern strategy, blue versus red, swing states and swing voters – all of those political clichés are quaint relics of a less threatening era that is now part of our past, or soon will be. The next conflict defining us all is much more unnerving.

 

That conflict will be between people who live somewhere, and people who live nowhere. It will be between people who consider themselves citizens of actual countries, to which they have patriotic allegiance, and people to whom nations are meaningless, who live in a stateless global archipelago of privilege – a collection of private schools, tax havens and gated residential communities with little or no connection to the outside world.

 

Mitt Romney isn’t blue or red. He’s an archipelago man. That’s a big reason that voters have been slow to warm up to him. From LBJ to Bill Clinton to George W. Bush to Sarah Palin, Americans like their politicians to sound like they’re from somewhere, to be human symbols of our love affair with small towns, the girl next door, the little pink houses of Mellencamp myth. Most of those mythical American towns grew up around factories – think chocolate bars from Hershey, baseball bats from Louisville, cereals from Battle Creek. Deep down, what scares voters in both parties the most is the thought that these unique and vital places are vanishing or eroding – overrun by immigrants or the forces of globalism or both, with giant Walmarts descending like spaceships to replace the corner grocer, the family barber and the local hardware store, and 1,000 cable channels replacing the school dance and the gossip at the local diner.

 

Obama ran on “change” in 2008, but Mitt Romney represents a far more real and seismic shift in the American landscape. Romney is the frontman and apostle of an economic revolution, in which transactions are manufactured instead of products, wealth is generated without accompanying prosperity, and Cayman Islands partnerships are lovingly erected and nurtured while American communities fall apart. The entire purpose of the business model that Romney helped pioneer is to move money into the archipelago from the places outside it, using massive amounts of taxpayer-subsidized debt to enrich a handful of billionaires. It’s a vision of society that’s crazy, vicious and almost unbelievably selfish, yet it’s running for president, and it has a chance of winning. Perhaps that change is coming whether we like it or not. Perhaps Mitt Romney is the best man to manage the transition. But it seems a little early to vote for that kind of wholesale surrender.

 

This story is from the September 13, 2012 issue of Rolling Stone.

 

 

 

 

 
Leave a comment

Posted by on August 29, 2012 in African American News

 

Tags: , , ,

How Paul Ryan’s plan could change Medicaid, Medicare and everyone’s access to 24/7 care

Guest Commentary

by Dr. Tyeese Gaines

The proposed changes to Medicaid and Medicare by Congressman, and Republican Vice Presidential candidate, Paul Ryan will undoubtedly change the landscape of 24/7 emergency care. U.S. emergency rooms, with 123.8 million visits per year, are a staple in many communities, especially inner city and rural areas.

As ER physicians, we are the relative safety net for certain aspects of health care, so anything and everything that affects health care, affects us in the ER. That rolls over to our patients, including how long they wait to be seen and the services we can offer.

A Medicare proposal of premium support — a government payment to each Medicare recipient to cover health care expenses — seems on first glance promising, but leaves holes.

Many seniors can barely afford their daily expenses on a fixed income; so keeping up with additional costs if their health expenses exceed the payment will be challenging.

“Ryan’s Medicare vision would shift the burden of cost from the federal government to seniors, which for African-Americans could be deadly,” says Dr. Cedric Dark, an emergency medicine physician at Saint Agnes Hospital, an urban, community, teaching hospital.

“Eventually, health care inflation will outpace the [premium] support and thus, seniors will have to dip into their savings to make up the difference if they opt for a private plan,” he says.

Dark, who also runs a health policy website called Policy Prescriptions, stresses how important Medicare and Medicaid are for many of his African-American patients.

Changes to Medicaid — the health program which insures persons and families under the poverty line — will include capping grants to a certain amount per Medicaid patient, regardless of services provided, leaving each state to fill in the gap or make cuts. This potentially means even less healthcare services for Medicaid patients.

“Ryan basically proposes to turn Medicaid over to the states and let states decide what to do for low-income people,” says Dr. Wes Fields, an emergency physician and chairman of the Emergency Medicine Action Fund. “You have to wonder what states like Texas would do. Look at their uninsured rate. It doesn’t bother them. Their biggest priority is to hold down costs and hold down taxes.”

Dr. Alden Landry is frustrated with the present system.

“It’s hard to practice medicine in an environment where hospitals and physicians see patients as dollar signs as opposed to individuals with needs,” says Landry, who is director of community outreach in the department of emergency medicine at Beth Israel Deaconess Medical Center in Boston.

“I see my career evolving beyond practicing medicine because I know more work will need to be done in health policy.”

Outside of the ER, Medicaid yields many woes. We often see the patients who cannot find follow-up for months, so they return to the ER looking for help. We also see the family who can’t afford Medicaid co-pays to see outpatient physicians. Worse, because of how little Medicaid pays doctors, fewer and fewer doctors accept the insurance plan now.

However, without Medicaid, the number of insured would have been much more than the nearly 50 million that existed before the Affordable Care Act. Medicare, as opposed to Medicaid, insures the oldest, sickest patients, especially of those seen in the emergency room.

Even without Ryan’s cuts, “seniors end up sitting around the emergency department longer [than other patients],” Fields says. “One effect [of the changes] for Medicare beneficiaries is that they’re likely to wait even longer to get an inpatient bed if they require hospitalization,” he continues. “Hospitals feel like they lose money on them.”

Regardless, the emergency room is still the portal for healthcare for many patients, especially those with nowhere else to turn.

“[The ER] is the only place in the health system where you have a right to health care,” says Fields.

Lower income, non-Hispanic black patients and those aged 75 and over are seen in U.S. emergency rooms more than other groups, according to a CDC report. In the same report, as family income increased, the number of emergency room visits went down.

“Hospitals would never have been able to subsidize 24/7 care for the poor and the elderly without the federal programs [Medicare and Medicaid] to cover the costs of their care.”

He adds that the 1986 mandate requiring that no patient can be turned away, regardless of their insurance status, is also tied to participation in Medicare and Medicaid. That mandate, EMTALA, established that as a right, without respect to the patient’s ability to pay.

“Working in the Emergency Department every day you can feel how desperate people are for health care coverage,” Dark says. “Even people with regular physicians come into the ER once they lose insurance because their primary care doctors refuse to see them once they become uninsured. Coverage is key to accessing health care.”

I agree. It feels good to know we’re taking care of any and all patients, especially those in need, but it can still be overwhelming. Many reports show that overcrowding in ERs across the country has increased. Yet, despite the rumors that uninsured patients are the reason for these long waits, recent data shows that that’s not true.

Those with Medicaid – of which one in five are black – were found to use ERs more than both the uninsured and those with private insurance. Among those under 65, more than one in four children and nearly two in five adults with Medicaid had at least one ER visit, sometimes more.

“Better access doesn’t necessarily reduce the number of people that come to the emergency department,” says Fields. “Look at what happened in Massachusetts.”

Some say that Medicaid — and the Affordable Care Act’s expansion of it — will parallel Massachusetts. After the state extended health coverage to the uninsured, which included increasing patients’ access to primary doctors and preventative care, emergency room visits still increased by nine percent between 2004 and 2008.

Fields adds that earlier Medicaid data created a misnomer of the misuse of the health care system by Medicaid patients, or as he says, the notion that “everyone who has Medicaid in the ED has a hangnail.”

This concept was, in fact, proven to be false. In the CDC report, the reasons for ED visits were at the same urgency regardless of whether the patient was uninsured, privately insured, or had Medicaid.

This suggests that Medicaid patients really do need the care, but raises the possibility that other groups are misusing the ER for their so-called “hangnails” as well.

The fact that emergency care is available 24/7 and often has access to tests and x-rays that primary care doctors do not, leads to some ER visits being based on convenience, rather than necessity.

This is also a convenience that with cuts, may not exist moving forward, if more become uninsured or underinsured. With the unique availability that emergency departments provide, Dark resents the “demonizing” of ERs by policymakers who characterize ERs as a negative part of health care and the most expensive places to get care.

In response to this claim, the American College of Emergency Physicians — an organization representing more than 28,000 emergency physicians, residents and medical students — actually reports that spending on emergency care only makes up 2 percent of total health care spending.

While Dark admits that ER visits come at a premium, he adds, “That’s why things cost more: convenience for patients, for referring physicians and for the uninsured. Who else works 24/7, 366 days a year?” (It’s a leap year).

More challenges are to come for ER physicians and hospitals by way of Medicare.

In October, some hospitals will have their Medicare payments reduced for readmitting recently discharged patients into the hospital. Nearly one in five Medicare beneficiaries are readmitted within a month.

The penalty, under the ACA, is a new effort to get hospitals to ensure that patients have a good plan once discharged. Since decisions on admitting patients often falls on the ER doctor, this is an added weight, and, in many cases, leads to a feeling that our hands are tied.

The question becomes: where should these sick patients go? Hospitals can’t control whether seniors have prescription coverage, allowing them to purchase the medications that will keep them from returning to the hospital. Hospitals also can’t control the availability of the patients’ primary doctors for appropriate follow-up.

“[The issue is] these are patients that no one is going to make money off of — those with diabetes, end-stage kidney disease, chronically ill, elderly, and medically or economically indigent,” says Fields.

“There’s a very high likelihood of those patients showing up in the [emergency department] between dialysis visits, for example, and private plans aren’t going to crawl all over each other [for them] either.”

The overarching concern is not only to Medicaid and Medicare recipients, but to all patients who utilize the ER for their care.

It is suspected that overcrowding would only get worse if cuts are made. For each patient’s care that is delayed, there’s more of a chance of dangerous outcomes, not to mention the delays in care when ambulances have to bypass certain hospitals due to overcrowding.

The problems of the ER and health care are not isolated to one doctor or one patient, one type of insurance, or one patient without. What happens to one group will certainly affect us all.

Dr. Tyeese Gaines is a physician-journalist with over 10 years of print and broadcast experience, now serving as health editor for theGrio.com. Dr. Ty is also a practicing emergency medicine physician in New Jersey. Follow her on twitter at @doctorty.

 
Leave a comment

Posted by on August 24, 2012 in African American News

 

Tags: , ,

Truth and Lies About Medicare

Editorial courtesy of the New York Times

Republican attacks on President Obama’s plans for Medicare are growing more heated and inaccurate by the day. Both Mitt Romney and Paul Ryan made statements last week implying that the Affordable Care Act would eviscerate Medicare when in fact the law should shore up the program’s finances.

Both men have also twisted themselves into knots to distance themselves from previous positions, so that voters can no longer believe anything they say. Last week, both insisted that they would save Medicare by pumping a huge amount of money into the program, a bizarre turnaround for supposed fiscal conservatives out to rein in federal spending.

The likelihood that they would stand by that irresponsible pledge after the election is close to zero. And the likelihood that they would be better able than Democrats to preserve Medicare for the future (through a risky voucher system that may not work well for many beneficiaries) is not much better. THE ALLEGED “RAID ON MEDICARE” A Republican attack ad says that the reform law has “cut” $716 billion from Medicare, with the money used to expand coverage to low-

income people who are currently uninsured. “So now the money you paid for your guaranteed health care is going to a massive new government program that’s not for you,” the ad warns.

What the Republicans fail to say is that the budget resolutions crafted by Paul Ryan and approved by the Republican-controlled House retained virtually the same cut in Medicare.

In reality, the $716 billion is not a “cut” in benefits but rather the savings in costs that the Congressional Budget Office projects over the next decade from wholly reasonable provisions in the reform law.

One big chunk of money will be saved by reducing unjustifiably high subsidies to private Medicare Advantage plans that enroll many beneficiaries at a higher average cost than traditional Medicare. Another will come from reducing the annual increases in federal reimbursements to health care providers — like hospitals, nursing homes and home health agencies — to force the notoriously inefficient system to find ways to improve productivity.

And a further chunk will come from fees or taxes imposed on drug makers, device makers and insurers — fees that they can surely afford since expanded coverage for the uninsured will increase their markets and their revenues.

NO HARM TO SENIORS The Republicans imply that the $716 billion in cuts will harm older Americans, but almost none of the savings come from reducing the benefits available for people already on Medicare. But if Mr. Romney and Mr. Ryan were able to repeal the reform law, as they have pledged to do, that would drive up costs for many seniors — namely those with high prescription drug costs, who are already receiving subsidies under the reform law, and those who are receiving preventive services, like colonoscopies, mammograms and immunizations, with no cost sharing.

Mr. Romney argued on Friday that the $716 billion in cuts will harm beneficiaries because those who get discounts or extra benefits in the heavily subsidized Medicare Advantage plans will lose them and because reduced payments to hospitals and other providers could cause some providers to stop accepting Medicare patients.

If he thinks that will be a major problem, Mr. Romney should leave the reform law in place: it has many provisions designed to make the delivery of health care more efficient and cheaper, so that hospitals and others will be better able to survive on smaller payments.

NO BANKRUPTCY LOOMING The Republicans also argue that the reform law will weaken Medicare and that by preventing the cuts and ultimately turning to vouchers they will enhance the program’s solvency. But Medicare is not in danger of going “bankrupt”; the issue is whether the trust fund that pays hospital bills will run out of money in 2024, as now projected, and require the program to live on the annual payroll tax revenues it receives.

The Affordable Care Act helped push back the insolvency date by eight years, so repealing the act would actually bring the trust fund closer to insolvency, perhaps in 2016.

DEFICIT REDUCTION Mr. Romney and Mr. Ryan said last week that they would restore the entire $716 billion in cuts by repealing the law. The Congressional Budget Office concluded that repealing the law would raise the deficit by $109 billion over 10 years.

The Republicans gave no clue about how they would pay for restoring the Medicare cuts without increasing the deficit. It is hard to believe that, if faced with the necessity of fashioning a realistic budget, keeping Medicare spending high would be a top priority with a Romney-Ryan administration that also wants to spend very large sums on the military and on tax cuts for wealthy Americans.

Regardless of who wins the election, Medicare spending has to be reined in lest it squeeze out other priorities, like education. It is utterly irresponsible for the Republicans to promise not to trim Medicare spending in their desperate bid for votes.

THE DANGER IN MEDICARE VOUCHERS The reform law would help working-age people on modest incomes buy private policies with government subsidies on new insurance exchanges, starting in 2014. Federal oversight will ensure a reasonably comprehensive benefit package, and competition among the insurers could help keep costs down.

But it is one thing to provide these “premium support” subsidies for uninsured people who cannot get affordable coverage in the costly, dysfunctional markets that serve individuals and their families. It is quite another thing to use a similar strategy for older Americans who have generous coverage through Medicare and who might well end up worse off if their vouchers failed to keep pace with the cost of decent coverage.

Mr. Romney and Mr. Ryan would allow beneficiaries to use vouchers to buy a version of traditional Medicare instead of a private plan, but it seems likely that the Medicare plan would attract the sickest patients, driving up Medicare premiums so that they would be unaffordable for many who wanted traditional coverage. Before disrupting the current Medicare program, it would be wise to see how well premium support worked in the new exchanges.

THE CHOICE This will be an election about big problems, and it will provide a clear choice between contrasting approaches to solve them. In the Medicare arena, the choice is between a Democratic approach that wants to retain Medicare as a guaranteed set of benefits with the government paying its share of the costs even if costs rise, and a Republican approach that wants to limit the government’s spending to a defined level, relying on untested market forces to drive down insurance costs.

The reform law is starting pilot programs to test ways to reduce Medicare costs without cutting benefits. Many health care experts have identified additional ways to shave hundreds of billions of dollars from projected spending over the next decade without harming beneficiaries.

It is much less likely that the Republicans, who have long wanted to privatize Medicare, can achieve these goals.

 
Leave a comment

Posted by on August 21, 2012 in African American Health

 

Tags: , , ,

How Would African Americans Fare Under a Paul Ryan Vice Presidency?

Matthew Lynch, Ed.D.

Chair and Associate Professor of Education, Langston University

The announcement has been made and everyone is scrambling to learn all they can about the Irish-Catholic Republican from Wisconsin. Many people are already calling Paul Ryan, the Senator that Mitt Romney tapped to be his running mate, as what could become a nightmare for black Americans. So just how bad of a pick could Ryan be for black Americans? Pretty bad!

Paul Ryan is proud to announce that he has some ideas that will become a part of, or expand upon, Mitt Romney’s. Problem is, those ideas can be dangerous, especially if you are a black American. Very dangerous. As a Vice President, Ryan would be in a position to play an important role in helping to set policy, both foreign and domestically. And that could change a lot of things for black Americans. Even Mitt slipped up in introducing Ryan and introduced him as the future “President” of the country, leading people to wonder if that was an honest slip of the tongue or if Ryan will really be doing more behind the scenes than we would all care to consider.

For starters, Ryan is proposing some major overhauls of the food stamp program, increasing the age that people can start getting Medicare, and for making cuts in the welfare program. For millions of black Americans it means they could literally lose the money they need to help feed their family and keep a roof over their heads.

Black Americans are often fingered as being the biggest proponent of utilizing the food stamp program in the country. But the disproportionate numbers don’t tell the entire story. Out of all those receiving food stamps, 22 % of them are Black Americans, compared to 36% of non-Hispanic whites. That number doesn’t reflect the difficulty that we as a people are struggling with in terms of finding jobs and in finding jobs that pay enough to support our families.

If Ryan gets his way and gets to make drastic cuts to the food stamp program, who will he really be hurting? A lot of children and senior citizens, for starters. The records show that 47% of everyone receiving food stamp benefits are children under the age of 18. Another 6% of those receiving them are seniors over the age of 60. And it doesn’t stop there, 41% of those who are receiving food stamps actually do work. They are considered part of the “working poor” people of America.

Picture a Romney/Ryan victory and what that will do to the black people of America. Those who have children, are struggling seniors, or who are families working hard to make ends meet each month, yet who are falling short. If Ryan’s plan isn’t to also increase jobs and access to a good education, then how can he merely do away with the one thing that is helping people to get by during these tough economic times? How can they in good conscious take away their benefits, without providing higher paying jobs so they can continue to get by?

Ryan’s ideas are dangerous for black Americans. Not just when it comes to food stamps. His ideas will lead to tax cuts for the wealthiest people in the nation, while increasing the taxes on the middle class, harder working families. It’s fair to say that not only will Ryan become one of the worst nightmares for black American if he does become the Vice President, but he will become so for middle class families everywhere. His sights are set on protecting the interests of the wealthy, and he doesn’t care who he has to step on to see those ideas through.

Another scary thought for black Americans is that when you visit the Romney official site you will find that he addresses a lot of “communities” of people. He specifically addresses the Asians, Catholics, Jewish, Polish, Women, and even young Americans. But there is no mention of black Americans. Either he has overlooked this segment of the population, or he simply doesn’t care about us, with both being equally as perilous.

In introducing his running mate, Romney said that he wanted someone that has “real character” and that Ryan had that. Whether or not he has character or merely is one remains to be seen. But for black Americans his ideals that impact us as a people appear to be a characterized by being out of touch with the people who make up this great country.

 
Leave a comment

Posted by on August 17, 2012 in African American Politics

 

Tags: ,

 
Follow

Get every new post delivered to your Inbox.

Join 447 other followers

%d bloggers like this: