Absent essentially free money, compliments of artificially low interest rates set by the Federal Reserve, over the past twenty years, leveraged buyouts wouldn't even be in our vocabulary. The mechanisms of fiancial control of the USD create these issues out of thin air by presenting opportunity.
As I've said, I hate MR with a passion. However, I disagree with the attacks on Bain.
Venture capital and private equity firms serve a function that cleanses the market. Absent private equity, Alltel would have folded instead of being revamped and sold to Verizon, HCA would be no more, First data would be a thing of the past - the list goes on. The markets and consumers inevitably determine the winners and losers, but cash inflow from private equity is all that saves a lot of companies. If these companies were to go belly-up and send all of their employees to the curb, would private equity be blamed for the job losses for not stepping in and saving them? Some work out, some don't. Cerebus tried like hell to save Chrysler.
The problem is that private equity firms are able to "socialize their losses" by transferring assets from the troubled firm directly to the private equity firm. Then if or when the troubled firm goes bankrupt, Bain has no responsibility to pay the firm's debts and can keep all that money. Thus we all end up funding Bain's profits out of our pockets by covering their losses through banks, insurance, taxes, or losses in the workers' pension plans. This is the explanation that answers the suspicion as to why Bain never seemed to lose money on a deal, even when their acquisitions went bankrupt. This is the kind of "capitalism" that people, quite rightly, do not trust. It's one of those things that sounds indistinguishable to most people from what Bernie Madoff did, but just happens to be legal. You can argue it's caused by government policy or the private firm itself, whatever. Just like with the mortgage meltdown of 2008, there is plenty of blame to go around.