Bain & Co. would likely have collapsed without a $10 million federal bailout negotiated by Mitt Romney in the early 1990s
Written by Jed Lewison for The Jed Report @ dailykos.com
Another day, another calculated attackfrom Mitt Romney … and this time he is trying to sound just like Michele Bachmann:
Mitt Romney on Thursday labeled President Barack Obama as a “crony capitalist,” invoking a theme that Rep. Michele Bachmann used before she left the presidential race.”This president is a crony capitalist. He’s a job killer,” the former Massachusetts governor said during a morning town hall meeting here. “This president has engaged and is engaging in crony capitalism.”
Bachmann used similar language before she dropped out of the race Wednesday after a poor showing in the Iowa caucuses.
If I had a dollar for every time Michele Bachmann called President Obama a crony capitalist, I’d be able to pay for the Bush tax cuts she and Mitt Romney are fighting for. But in a quick search of Nexis, I couldn’t find an example of Romney using that sort of language. Now she’s out of the race, however, and to woo her supporters, Romney is robotically parroting her lines.
But even though Mitt Romney is supposedly smarter than Michele Bachmann, the attack doesn’t make any more sense when he says it than when she does. I can understand why conservatives might not like President Obama’s policies, but he’s not corrupt. Not even Darrell Issa has been able to come up with anything that remotely supports such a claim.
And while Bachmann at least voted against TARP, giving her some standing to use the rhetoric of crony capitalism, Romney not only supported it, but has personally benefited from what Bachmann would certainly call “crony capitalism.” In 1991, he convinced the federal government to forgive $10 million in debts owed by Bain & Co., a deal that helped prevent his company from failing and ultimately made him millions of dollars. Via Nexis, here’s a story about it published on October 25, 1994 in The Boston Globe:
Republican Senate nominee Mitt Romney’s rescue of a business consulting firm was achieved in part by convincing the Federal Deposit Insurance Corp. to forgive roughly $ 10 million of the company’s debts, according to sources close to the deal and federal records obtained by The Boston Globe.Romney, whose business acumen has been the cornerstone of his campaign, has said saving the Bain & Co. consulting firm from the brink of bankruptcy in 1991 was the accomplishment that most convinced him he had the mettle to be a US senator.
Bain & Co. and the FDIC agreed to the deal after months of intense negotiations. Moreover, bankers say debt forgiveness is relatively routine when a company is at risk of collapse.
But the $ 10 million cost to the FDIC raises the question of whether Romney’s success, as well as the resurrection of Bain & Co., came partially at the expense of the federal agency that protects US bank deposits.
No doubt Mitt Romney would defend that $10 million in federal aid to Bain & Co. as having prevented the bankruptcy of his firm and as having saved hundreds of jobs. But the corollary of that argument is that Mitt Romney saved Bain & Co. with a $10 million bailout from the federal government—and given that fact, he’s the last person on Earth who should be accusing anybody of crony capitalism.