People who loot companies

By Rob Howard
Gayly Political Columnist

In 1989 Northwest Airlines, the airline I worked for, was purchased by a group of venture capitalists. When they bought Northwest, it had practically no debt, which made them a great target for what is called a leveraged buy-out or LBO. Al Checchi, who headed the LBO, put $12 million of his own money into the effort. The end result was Northwest emerged from the LBO with over 3 Billion dollars in debt. Burdened by this massive debt load, by 1993 Northwest was on the verge of bankruptcy.

To prevent bankruptcy, the owners got the companies workers to agree to $800 million in concessions. They also got over $800 million in loans, subsidies and tax credit from the state of Minnesota. Checchi and his group eventually took the company public. Checchi alone amassed a fortune of $700 million dollars.

Why does this matter? It matters because the (presumptive) Republican nominee for President, Mitt Romney, played in the same kind of game when he owned and directed Bain Capital. He and his ilk specialize in buying companies, burdening them with debt, extracting millions of dollars from them, and taking them into bankruptcy. In the process, hundreds of workers lose their jobs, their pensions, their health insurance; sometimes they actually get to stay around, with no job protections, for much lower wages.

Romney wants us to believe that because of his business experience, he should be President of the United States. He claims that he has created over 100,000 jobs, a number that has grown over his years as a professional candidate.

He doesn’t deny that Bain Capital sent jobs overseas, mainly to low cost labor areas like India and China. He just says that it didn’t happen when he controlled the company. He and his campaign continue (at this writing) to insist that Romney left Bain in 1999 before all this outsourcing began, even though SEC documents show that he was the owner and CEO into 2002. To me, it really doesn’t matter when he left Bain. Profiting by killing American jobs is what he is all about – it doesn’t matter whether the jobs end up in China or not.

Romney lies about more than his experience at Bain. His group can’t begin to credit President Obama with anything positive. At the same time he supports GOP plans to destroy Medicare and Medicaid, to gut public education, and to give people making over $250,000 a tax cut. He and the radical right insist that people like Romney are “job creators,” and taxing them will destroy the economy.

He gets it completely wrong. People who run companies will do back flips through flaming hoops to avoid hiring even one more employee – until they need that employee to meet the demand generated mainly by the American middle class. The middle class create jobs by buying stuff. Romney’s supporters in Congress have spent the last three decades making sure that middle class income stagnates.If you earned $15,000 in 1980, and you earn $30,000 now, you can barely buy the same amount of things you bought in 1980. In the same period, the top 1% of taxpayers have seen their incomes go through the roof. It isn’t unusual to see CEOs of companies making $10, $20, $30 million a year (!) and more, while they lay off workers and spend millions to tell lies about President Obama.

I don’t want a President who spent his career firing people, sending jobs to India and China, and amassing a fortune on the backs of workers at the companies he bought. I don’t want a President who will do nothing for the middle class, while generating hundreds of millions of dollars for his 1% pals.

I want a President who has a vision for our country, who knows my experiences growing up, who knows that our hopes and our dreams can drive our economy, and who believes that every person in our country deserves an equal opportunity to succeed. That President is Barack Obama.