Mitt Romney is not Gordon Gekko. Or is He?

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Is Mitt Romney really the Gordon Gekko of presidential candidates thanks to his years of running Bain Capital? Newt Gingrich and Rick Perry sure seem to think so, accusing him of making his millions by wreaking wholesale devastation on innocent companies and hardworking laborers. This is, as you might expect, just a wee bit over the top. Still, before we dismiss the comparison entirely, Dean Baker lists a few of the Gekko-like behaviors that real-life private equity firms sometimes engage in:

It is standard practice for private equity to load firms with debt. This means that taxable profits are turned into tax-deductible interest payments. The difference can be a gain to Bain and other private equity firms, but it is coming at the expense of taxpayers.

In the same vein, private equity companies often engage in complex asset shifting. This can leave a heavily indebted firm with few valuable assets. If it eventually goes bankrupt, the creditors collect little money because the private equity company has transferred the assets with value into an independent company. This can also mean big profits for Bain and other private equity companies, but this is not a gain to the economy.

Another frequent game of private equity companies is to dump pension obligations on the Pension Benefit Guaranty Corporation. The reduction in liabilities can mean big profits for Bain and other private equity companies, but does not provide any benefit to the economy.

This, then, is the assignment for some enterprising reporter. Did Bain Capital do this kind of thing during Romney’s stint there? Or did they really and truly just work hard to try and turn failing companies around by applying state-of-the-art management techniques? I expect answers from our nation’s press corps soon, just as soon as they finish spitballing over whether John Bolton’s endorsement of Mitt will finally bring the paranoid wingnut vote solidly into his camp.

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We've never been very good at being conservative.

And usually, that serves us well in doing the ambitious, hard-hitting journalism that you turn to Mother Jones for. But it also means we can't afford to come up short when it comes to scratching together the funds it takes to keep our team firing on all cylinders, and the truth is, we finished our budgeting cycle on June 30 about $100,000 short of our online goal.

This is no time to come up short. It's time to fight like hell, as our namesake would tell us to do, for a democracy where minority rule cannot impose an extreme agenda, where facts matter, and where accountability has a chance at the polls and in the press. If you value our reporting and you can right now, please help us dig out of the $100,000 hole we're starting our new budgeting cycle in with an always-needed and always-appreciated donation today.

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