Posted on 01/09/2012 9:34:11 PM PST by americanophile
Newt Gingrich has ramped up his attacks on Mitt Romney as a heartless leveraged buyout executive for his years at Bain Capital, asking reporters in Manchester on Monday, Is capitalism really about the ability of a handful of rich people to manipulate the lives of thousands of other people and walk off with the money? Or is that, somehow, a little bit of a flawed system?
But Mr. Gingrich was himself on an advisory board for a major investment firm that had a similar business model, Forstmann Little, a pioneering private equity firm co-founded in 1978 by Theodore J. Forstmann that was, along with Mr. Romneys Bain Capital and Henry R. Kraviss Kohlberg Kravis & Roberts, among the leading private equity firms during the 1980s and 1990s.
Forstmann Little earned billions of dollars in profits from its investments in companies including General Instrument and Gulfstream Aerospace. But the firm shut down most of its operations a decade ago after suffering losses from ill-timed bets on high-flying telecommunications companies at the height of that industrys bubble.
(Excerpt) Read more at thecaucus.blogs.nytimes.com ...
Corporate Raiders wouldn’t have spent 50 years raiding companies if they weren’t trying to provide “benefits” that we’re encouraged by gummint and in so doing amassed huge piles of resources that were vulnerable. That wasn’t capitalism it has been “Socialism Lite”. Those resources should have either been paid out to employees who could provide their own benefits or plowed into lower prices or R&D. THAT would have been capitalism and there never would have been corporate raiders.
My prediction: there will be just enough of a Republican win that the Brown Shirt Media will be able to say the pub bids run things with the Congress and the Presidency but not enough of a win to actually put the brakes on this train wreck. Then the BSM can blame the pubbies for another 40 years.
He came out in 1980 and said that junk bonds would be the downfall of Wall St (it took 7 years for that to happen).
He also coined the term "barberians at the gate" in describing Henry Kravis and KKR as what in it was like when corporate raiders (like Bain) come knocking.
Talking points.
So why should American taxpayers have to be forced to pay for Willards business incompetence and greed?
Workers were denied the severance pay and health insurance theyd been promised, and their pension benefits were cut..
Whats more, a federal government insurance agency had to pony up $44 million to bail out the companys underfunded pension plan. Nevertheless, Bain profited on the deal, receiving $12 million on its $8 million initial investment and at least $4.5 million in consulting fees.
http://legalinsurrection.com/2012/01/bain-drip-drip-drip/
Forstmann was the only dealmaker of note opposed to the use of junk bonds (he called junk bonds "wampum"). He took a good deal of ridicule about his position.
When Drexel Burnham Lambert, Michael Milkin, and others bit the dust...he was proved right.
For what its worth, I am not opposed to the use of junk bonds for LBO's, but Romney will have a hard time getting elected with this background.
"I do think at a certain point you've made enough money
- Barack Obama
Your unbridled defense of Romney has blinded you to what is happening. Americans have a right to know the truth about Romney whether you like it or not.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.