At the end of August Rolling Stone published an article called “The Federal Bailout That Saved Mitt Romney,” by Tim Dickinson. The article made the rounds, but had dropped off my radar when I was reminded of it again. I was alerted to a HIGH-LARRY-US parody video — that captures this explosive story — called “King of the Dole.” Now I am trying to help the creator make it go viral.
Now that it’s the morning after the second Presidential debate, as all the pundits decide who won and how much Mendacious Mitt lied, it’s worth taking a look back to see how Mitt Romney’s entire reputation for his self-proclaimed business acumen is based on a lie. To put it bluntly: He didn’t build that and knowing what actually happened shows Romney’s entire presidential campaign is predicated on a pack of lies.
In the Rolling Stone article Dickinson digs deeply into the early days of Bain Capital and outlines an act of what can only be described as blackmail to keep it afloat, leaving taxpayers on the hook for more than $10 million. While it’s a complicated financial story, Dickinson offers this pithy summary:
[T]he legend crafted by Romney is basically a lie. The federal records, obtained under the Freedom of Information Act, reveal that Romney’s initial rescue attempt at Bain & Company was actually a disaster – leaving the firm so financially strapped that it had “no value as a going concern.” Even worse, the federal bailout ultimately engineered by Romney screwed the FDIC, the bank insurance system backed by taxpayers, out of at least $10 million. And in an added insult, Romney rewarded top executives at Bain with hefty bonuses at the very moment that he was demanding his handout from the feds.
The timeline of Romney’s involvement in this story begins in October 1990, when Bill Bain appointed Romney as managing director of Bain and Company. The company was struggling to stay afloat, in debt to the Federal Deposit and Insurance Corporation for $30 million, and Romney was tasked with turning things around.
However, it didn’t go so well for Romney. By March 1992, an internal FDIC memo noted that Bain’s financial condition was as dire as ever, and that its “operating performance had deteriorated.”
As summarized by CampaignWatch.org:
In 1992, while Romney was managing director, Bain and Company was in debt to the Federal Deposit and Insurance Corporation (FDIC) for $30 million. Nevertheless, in April 1992, Romney approved lavish bonuses for Bain executives, which helped bring Bain close to bankruptcy months later.
Romney then threatened the FDIC in 1993 with doling out more executive bonuses unless it forgave $10.7 million of Bain’s debt. The FDIC capitulated, concluding that Bain had “no value as a going concern” and “would otherwise fail.” The Romney campaign has refused to answer media questions about these disclosures and documents.
Aside from the part about the FDIC bailout, this wasn’t a whole lot different from Bain Capital’s normal modus operandi: 1). Buy a company; 2). Load it up with debt; 3). Take out all the profits in management bonuses; 4). Allow it to go bankrupt once Bain stripped the carcass clean. Only this time it was Bain Capital’s parent company about to go under, which would have rocked investor confidence. So it had to be saved.
While Romney took a government bailout to save Bain, he has no problem pretending he “built that.” The hypocrisy wouldn’t be so quite so egregious were it not for a few, more recent, facts:
During the lead-up to the Republican Convention Fox “News,” which has proven over the years to be a subsidiary of the Republican Party (or leader, take your pick), took a remark by President Obama out of context by falsely editing a video to make it sound as if the president said small business owners didn’t build their own businesses. A full reading of his remarks show that the president was talking about infrastructure — roads, education, the internet, fire departments, etc. — that help businesses succeed. After Fox “News” promoted its false narrative, the Republicans decided to build a whole night of its convention around the false quote. In other words, Mitt Romney didn’t even build the false narrative; it was a Fox “News” lie.
Long after this election is over, flip flops and lies will be the legacy of Mitt Romney’s campaign. On a variety of issues Romney has had more positions than the Kama Sutra, So many that his wife Ann has had to come out and deny it as recent as yesterday. And the lies? Steve Benen of the Rachael Maddow Show has been keeping track in a weekly series called Chronicling Mitt’s Mendacity. He’s already up to Volume 38 and it shows no signs of ending, unless election day is definitive.
However, if one wants the perfect metaphor for the entire Romney-Ryan campaign, one need go no further than Paul “Ayn” Ryan’s actions earlier this week. According to news articles all over the innertubes, Lyin’ Ryan “ramrodded” his way into a Youngston, Ohio, soup kitchen for a Photo Op, where he pretended to wash dishes that were already clean. The president of the local St. Vincent De Paul Society says Ryan’s actions could jeopardize its funding, as they are an apolitical organization.
Clearly after a secret recording was released in which Mendacious Mitt denounced 47% of the population as takers (Ryan put the figure at 30%), the campaign has been doing everything in its power to burnish the ticket’s street cred with that 47% of ‘Merkins. Yet the spending cuts the ticket is proposing would hurt the poor the most, the same people who are helped the most by a soup kitchen.
That’s why the video above resonated with me. In a quick 2 minutes and 13 seconds it says what took paragraphs and hundreds of words to say, and it’s a lot funnier besides. The whole Romney-Ryan campaign is built on a house of cards and the lie that Mitt Romney “built that” at Bain Capital is simply untrue. He didn’t even build his most famous lie. Watch the video again and sing along.