Free Markets, Free People


“Conservatives” attacking capitalism [update]

Whether you like Mitt Romney or not, Jay Nordlinger at NRO is right about one thing that has disturbed me: we’ve been treated to a spectacle, through these often destructive debates, of so-called “conservatives” attacking capitalism in an effort to gain votes.  And yes, I meant to put the word in scare quotes because such attacks, by supposedly real conservatives (just ask them, each will tell you he’s the only “real” conservative in the race), should be unthinkable.

Nordlinger offers a litany of examples from two elections cycles, starting with:

Last time around, Mike Huckabee said Romney “looks like the guy who laid you off.”Conservatives reacted like this was the greatest mot since Voltaire or something. To me, Romney looked like someone who could create a business and hire the sadly unentrepreneurial like me.

Others said, “He looks like a car salesman,” or, worse, “a used-car salesman.” Ho ho ho! Commerce, gross, icky, yuck. Better Romney looked like an anthropology professor.

Or a law professor and community organizer, which is what we got.  Frankly, I’ll take a used car salesman any day over what we have now.

But Nordlinger’s point is true.  In their quest to tear down the bona fides of the candidate most threatening to their run for the roses, “conservatives” have been reduced to taking pot shots at capitalism even while they claim to be its champion.

Over and over, Romney defends and explains capitalism. And he’s supposed to be the RINO and squish in the race? That’s what I read in the conservative blogosphere, every day. What do you have to do to be a “real conservative”? Speak bad English and belch?

In the Saturday debate, Santorum knocked Romney for being just a “manager,” just a “CEO,” not fit to be president and commander-in-chief. This was odd for a couple of reasons: First, Romney did have a term as governor of Massachusetts (meaning he has executive political experience, unlike Santorum). And second: Since when do conservative Republicans denigrate private-sector experience?

Indeed, the Santorum remark hit me as the remark of someone who has no idea what a “manager” or “CEO” does.  But as Nordlinger points out,  Romney’s also been an executive position, something Santorum hasn’t. Naturally he left that out.

The disturbing aspect of the Santorum remark is the apparent poor regard in which he holds business managers and CEOs in a capitalist system and believes you should too.  This is just the “conservative” version of the Democrats class warfare shtick.

More Nordlinger:

Now Romney has said, “I like being able to fire people who provide services to me. You know, if someone doesn’t give me the good service I need, I want to say, ‘You know, I’m going to get someone else to provide that service to me.’” Simple, elementary competition. Capitalism 101. And conservatives go, “Eek, a mouse!”

I could go on: the $10,000 bet, the pink slips, conservatives wetting their pants, over and over. They have no appetite to defend capitalism, to persuade people, to encourage them not to fall for the old socialist and populist crap. I fled the Democratic party many years ago. And one of the reasons was, I couldn’t stand the class resentment, the envy, the hostility to wealth, the cries of “Richie Rich!” And I hear them from conservatives, at least when Romney is running.

So again, whether or not you’re a Romney fan (and I’m not), Nordlinger’s point is well taken.  The problem for politicians is it is hard to explain the benefits of capitalism.  But it is even harder to refrain from making assaults on another candidate when you think such an assault might be popular and gain votes.  After all, the capital of elections is votes.   In effect,  however, these “conservatives” unknowingly (or uncaringly) back the class warfare message of the left and the OWS crowd.  They are engaged in attacking and denigrating the very system they supposedly fervently support and see as the way out of the morass we find ourselves in.

And of course, at some point, depending on how this all turns out during the primary run, one of these “conservatives” may prevail and want to wrap himself in the mantle of “champion of capitalism” to solidify his base.  I have to wonder about his reaction when his intemperate words of today are turned on him by his opponent in the race.

UPDATE: Speaking of full on attacks by “conservatives” on Romney, based in twisting his past into an anti-capitalist assault, Newt Gingrich has committed to just that.  Even the left, in the person of Jonathan Chait, seems to understand that’s what is happening.  As Chait says, the attacks by Gingrich are not substantially different than those from MoveOn.com

The political effect of these ads is to turn Romney’s chief selling point into a liability – his private-sector experience becomes an indicator not that he will fix the economy but that he will help the already-rich. It’s a smash-you-over-the-head blunt message, with ominous music and storybook dialogue. At one point, the narrator says of  Bain’s executives, “their greed was only matched by their willingness to do anything to make millions in profits.” (Aren’t “greed” and “willingness to do anything to make millions in profits” synonymous terms? Isn’t this like saying “his height was matched only by like lack of shortness”?)

The substantive merits of the attack are, obviously, a lot murkier. Romney’s job at Bain was a classic piece of creative destruction. The proper working of a free market system relies on ruthlessly identifying and closing down non-competitive business concerns. Gingrich’s assault relies on drawing a distinction between real capitalism and the “looting” undertaken by Bain Capital. “If somebody comes in takes all the money out of your company, and then leaves you bankrupt while they go off with millions,” he argues, “that’s not traditional capitalism.” The distinction is utterly ephemeral. It’s a way of saying you’d like all the nice aspects of capitalism without the nasty ones – creating new firms and products without liquidating old ones. For once I agree with inequality-denier and supply-side maven James Pethokoukis, who praises Romney’s work at Bain.

Trust me, when Chait agrees with James Pethokoukis, the reason for such agreement must pretty obvious – the attacks are a load of nonsense that even a leftist like Chait can’t ethically bring himself to accept.   Instead, Chait is reduced to emotionalism to at least find a way to take a shot at Romney’s record.

But the point is you have “conservatives” leading the charge and doing the opposition research and framing the attack on one of their own.  As an aside, I’ve been telling Newt fans that they’ll eventually see “bad Newt” show up, especially when he starts losing.  Well, here he is, in full and living color.

~McQ

Twitter: @McQandO

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28 Responses to “Conservatives” attacking capitalism [update]

  • And all of the candidates wonder why Republicans wish we had someone else to choose from. But they are making me start to support Romney with this garbage.

    • @The Shark I also blame the moderators of the debates. Does anybody think if this had been a Democratic debate that they would have had Rush Limbaugh, Glenn Beck, Mark Levin, Laura Ingraham or Sean Hannity moderate ?
      The questions all go in the wrong direction (i.e. away from Obama’s weaknesses).

  • There are, however, a number of things about Bain that should get some closer scrutiny. The jobs numbers Romney is claiming aren’t standing up to close scrutiny, and the behavior of Bain with regards to how they bought some companies, used them to collect debt, and then jettisoned them…

    And if you think what “<i>”conservatives”</i>” are doing is bad, what do you think the Left will do?

    • @Scott Jacobs Like I said, compare the Newt and MoveOn ads.

    • @Scott Jacobs ZeroHedge has up an old evaluation of the PE sector …

      And while these companies life expectations are limited at best, regardless of how Hertz’ lawsuit against anyone who has a sell rating against the firm goes, the biggest threat is to the entire PE industry, which just like the CRE space, will be facing a massive refi threat into 2014. Between 2011 and 2014, there is roughly half a trillion in LBO debt maturing. Add that to the $1.5 trillion in bank debt due for rolling, and the roughly $3 trillion in CRE debt that is also supposed to be refinanced, and one can see how the next president will have his arms full as he/she will need to find a way to roll about $5 trillion in debt without the benefit of securitizations. Furthermore, since the economy will be on stimulus #10 by then courtesy of a drunk with power Obama, America will be on fast track to sovereign and corporate Armageddon.

      … no wonder they need a PE expert as President.

      http://www.zerohedge.com/article/disastrous-performance-private-equity-top-10-lbos-6-are-distress-4-have-defaulted

  • I see Romney as a “Bob Dole Redux.” He is the guy that the Republican insiders have decided is next in line.
    We all remember how Bob Dole did in 1996. This is the “Republican insanity” .. doing the same thing over and over expecting different results.
    Whether you are attacking capitalism or not, Mitt Romney is the perfect candidate to feed into the Obama “class warfare” meme. They couldn’t have asked for a better foil. Bain Capital represents, in part, the part of capitalism that has gotten us where we are now … a producer of debt. It is almost a given now that any company with significant cash holdings is a target of those who want to wring out the cash and leave them with debt.
    And frankly, I don’t think most American really care enough to even pay attention to a debate on capitalism vs socialism. Bore them enough and they will vote for the same old guy again.

  • Capitalism is getting a bad name because we keep using it to describe our system of dollars buying laws a regulations that benefit so called capitalists and prevent competition from actual capitalists.
    We have two choices right now, the status quo as preserved by the left or the status quo as preserved by the right, the difference is around the edges.
    If you even have the slightest question over whether this is true or not, just look at corporate tax policy. Both sides have said that we should lower corporate taxes and eliminate the loopholes. You’d think this would be the slam dunk of bi-partisan legislation. But it’s not. It is probably the most rational policy idea that has been floated in Washington since the GI Bill and our current policy is as irrational as selling C4 to al Qaeda. So why does the irrational keep winning? The answer is that it is rational to some, and that some happen to be the people that pour money in lobbyists pockets to keep the advantages and disadvantages right where they are.

    • @CaptinSarcastic Bain Capital wasn’t entirely a vulture-like endeavor, but it did use some vulture-like endeavors.

      On the good side of capitalism, we have Staples which was funded by Bain during it’s startup phases. On the bad side of capitalism, we have Clear Channel Communications which market watchers believe won’t survive when the original loans taken out with Bain’s help go into refinancing.

      What seems to be lost in the Bain discussion is that there are forms of capitalism that have a really bad track record of bringing misery, while at the same time there are also fine upstanding examples of capitalism doing what we expect it to do, generate wealth.

      Businesses are much like people .. they are born, they grow, they get old, they die. Bain seems to, on more occasions than anyone would like, to be there collecting their fees .. play a business Dr. Kevorkian as they speed up the dying process.

      The common theme, involving Bain, is that folks who look askance at Bain’s Dr. Kevorkian role are condemning all doctors. This is simply not true.

      • @Neo_ “play a business Dr. Kevorkian as they speed up the dying process.”

        Yeah, but usually, Dr. Kevorkian didn’t take out a charge card in the patient’s name, max it out with cash advances, and THEN help the person die…

        • @Scott Jacobs @Neo_ Well said Scott. Companies will die without any help of course, but without that help, they may be resurrected as smaller leaner workable versions of their former failing business. That new entity could then grow into a productive successful entity. With the vulture help, they are slaughtered and carved up to profit a very few, and there is nothing left to build on. This isn’t assisted suicide, this is killing the paraplegic who desperately wants to live, but needs time and support to fight for his life.
          Just because a profit can be made on a business model does not mean it is good business.

  • Moreover, it benefits Congress to keep the complexity and tinker in favor of their special interests in the million pages of policy where it will be hard to notice. And the lobbyists and Congress Critters especially love doing temporary tax favors (extenders), so the lobbyists can go back to the client and say “you gotta pony up if we are going to keep this gift in place”, to keep the merry-go-round turning.
    Do you really want to keep tarnishing the beautiful system of capitalism by giving this moniker to our status quo?

    • @CaptinSarcastic The thing about capitalism is that it works even under less then perfect conditions.

      Yes, our capitalist system is far from pure, but it is still one of the better ones around the world. I’ve heard the argument that either it needs to be nearly perfect or else we need more intervention, with the ultimate argument being that more intervention is needed.

      what we do need is LESS intervention and more freedom. Even Romney would bring that, relative to Obama.

      • @Don S Sure, capitalism is working. It is working in the shops and flea markets and it is working well in the tech industry. But our economy as a whole is FAR from capitalist, unless you think of using capital to buy regulations that protect you and prevent competition to be capitalism. I see you noted that some people claim we need more intervention, that is not claim I made, in fact, it is the intervention of private monies (right and left) that have distorted our system to such an extent that it does not deserve to even be called capitalism. Perhaps corporate socialism.
        A very large majority of voters on the left and right agree on several principles, one being that no industry should be allowed to hold more than a small percentage of the GDP in assets, 2% to 4% are commonly accepted maximums. But does it happen, even though it is a rational idea supported by the people who our government supposedly represents? No. Ask yourself why. Voters across the board agree on a simple lower corporate tax rate, 10% to 15%. Does it happen? No. Ask yourself why.
        This is NOT capitalism and sure isn’t a free market.
        I udnerstand the cries to “get government out of the way”, but neither side is going to do that when having the government in the way of competitors to the campaign funders is just what the status quo assures.

      • @Don S @Don S Sure, capitalism is working. It is working in the shops and flea markets and it is working well in the tech industry. But our economy as a whole is FAR from capitalist, unless you think of using capital to buy regulations that protect you and prevent competition to be capitalism. I see you noted that some people claim we need more intervention, that is not claim I made, in fact, it is the intervention of private monies (right and left) that have distorted our system to such an extent that it does not deserve to even be called capitalism. Perhaps corporate socialism. A very large majority of voters on the left and right agree on several principles, one being that no bank should be allowed to hold more than a small percentage of the GDP in assets, 2% to 4% are commonly accepted maximums. But does it happen, even though it is a rational idea supported by the people who our government supposedly represents? No. Ask yourself why. Voters across the board agree on a simple lower corporate tax rate, 10% to 15%. Does it happen? No. Ask yourself why. This is NOT capitalism and sure isn’t a free market. I udnerstand the cries to “get government out of the way”, but neither side is going to do that when having the government in the way of competitors to the campaign funders is just what the status quo assures

  • So far every GOP challenger has had a surge, making him the potential anti-Romney. All have faded, as Santorum appears to be doing now. That leaves Jon Huntsman. If he does well in New Hampshire — maybe even surprisingly well — he might end up being the last standing anti-Romney. That’s a bit ironic.

  • Newt’s doing the GOP and Romney, if he gets the nomination, a favor by throwing this dress rehearsal of what’s coming Romney’s way in the general. And this is just a piece of that. I saw Newt this morning and he was making some rather impressive distinctions, not denying Romney’s business achievments, but painting him into the scavenger corner, which is an important part of capitalism. But so is the junk yard. You don’t necessarily want to front a scavenger or a junk dealer as your presidential candidate.

    Newt played nice in Iowa. Took the high road and obeyed the 11th commandment. He stole the debates and got a huge boost in his numbers. What happened? Romney’s people attacked him ruthlessly and relentlessly. No 11th commandment for them. Now it’s Newt’s turn. Payback.

    Too bad Republicans are constrained by (my theory) all the Mormon money that they take from going after Romney’s odd religion, because the Democrats are not going to observe any such constraints, and if he is the nominee that’s going to leave quite the crater in Romney’s campaign when it hits. There won’t be any dress rehearsal for that.

  • I think Romney’s actually had a real job at one point. A kid working at McDonalds for a year or so has more real world work experience than The Dear Golfer in the WH.

    • @TheOldMan Oh, the rhetoric is so much more fun that reality. Obama spent a year as a financial researcher and writer in New York City, for Business International Corporation, a firm that catered to multinational corporations. I’m thinking a year in the financial sector researching and writing about hedges and forwards and currency fluctuations is just a little more than no experience in the “real world”.

      Perhaps if he had family money, he would have to put it work. Mitt won’t release any records of what he is actually worth or how much he inherited from his father, who earned about $300k a year in the auto business (that’s about $1.8M in todays dollars).

      Still, I think Romney is a very competent executive, I just don’t know how much that matters in our tragically broken political system.

  • CEO IS an executive position. CEO, mayor, governor, ship captain, general, etc.

  • I heard some interesting theories about how this meme will play out in the general, some saying that Bain Capital will be Romney’s “Willie Horton”. But I think the closest to the mark will be a strategist who believes this will be more akin to John Kerry’s “Reporting for duty” salute when he accepted the Democratic nomination. Kerry, and others, believed his military service, relative to George W. Bush, would be his greatest strength, and in the end it was turned against him so hard it became a liability.
    That is what Bain Capital may be to Romney, who constantly refers to his experience at Bain Capital to the be his greatest positive differentiator in the primaries as well as the general. This is exactly where the Democrats are going to go after him, as a corporate raider who profited from destroying companies and killing jobs. There are thousands, perhaps tens of thousands, who lost their jobs in the deals of Bain Capital, and some of those stories are going be tragic (call these stories political ads).
    Just like democrats were wishing Howard Dean were their candidate by the time the first Tuesday in November came around, Republicans may well be wishing they picked someone who was not tainted by experience in capital markets.

  • Now if only Romney would propose policies that support capitalism.

    It’s pretty bad when the Republicans are the party of not quite as much huge intrusive government, and the only candidates that really support capitalism are ignored (Johnson) or treated as a crazy uncle (of course it would be better if he acted less like a crazy uncle)

    • @newshutz Well let’s not overstate the case, even if I were to concede your point on intrusiveness in business regulation (I don’t), the GOP is FAR more intrusive in their social issue positions. So at best, we have two hugely intrusive big government parties who differ on where in your lives they want to be more intrusive.

      • @CaptinSarcastic

        In 2007 under G.W.Bush, a law was passed that requires Oil Companies to mix with gasoline a product that still does not exist.

        The Obamacare mandate was originally a Republican proposal.

        Lots of tax breaks for special interests under a Republican Congress and President, while the invisible drain on the economy of large deficits tax us all. (Spending is taxing)

        OTOH, the Democrats sure want to interfere in all sorts of areas of our personal lives. (look beyond sex to food, video games, ….)

        Way over here on the liberty end of the spectrum its hard to tell the difference.

      • @CaptinSarcastic

        In 2007 under G.W.Bush, a law was passed that requires Oil Companies to mix with gasoline a product that still does not exist.

        The Obamacare mandate was originally a Republican proposal.

        Lots of tax breaks for special interests under a Republican Congress and President, while the invisible drain on the economy of large deficits tax us all. (Spending is taxing)

        OTOH, the Democrats sure want to interfere in all sorts of areas of our personal lives. (look beyond sex to food, video games, ….)

        Way over here on the liberty end of the spectrum its hard to tell the difference.

        • @newshutz I think one of the ironies of the whole food police thing is that the government on the one hand talks about people limiting their intake of certain decidely unhealthy foods, and on the other subsidizes those same foods. I’d be happy just to see the subsidies end on foods that kill people and drive up healthcare costs on all of us. OTOH, since Reagan passed EMTALA that made it illegal for any healthcare provider that accepts Medicare or Medicaid to refuse treatment to anyone that needs it, what people do to themselves became all of our business, because we became financially responsible for a lot of it. In that case, there is an argument to be made that you add the cost that people will be passing onto us, into the cost of those bad choices. I get the liberty argument, but we need to either get rid of holding others responsible for healthcare costs (anyone think we are going to repeal Medicare?) or make people more responsible for bad choices by adding cost to those choices.

  • Wow, Newt goes all Michael Moore on Romney in a 28 minute video http://www.kingofbain.com/ . Obama won’t have to change a thing, except maybe to note that this was produced and pushed by a Republican group.