The GOP's Creative Destruction
Venture socialism is certainly empathetic. Venture capitalism, on the other hand, happens to be useful.
Yes, it's true that unlike some Republicans, Democrats don't "enjoy firing people." They enjoy "investing" your money in exploding electric vehicles, bullet trains, and other highly unprofitable but morally satisfying economic misadventures. Venture socialism is certainly empathetic.
Venture capitalism, on the other hand, happens to be useful.
And until the presidential aspirations of Newt Gingrich were dashed by this starch-shirted RINO, there existed a target-rich environment for conservatives—namely Mitt Romney's elastic record on policy. Yet for reasons well-known, Newt and other Republicans have chosen to make Barack Obama's populist case by attacking Romney's record at Bain Capital.
To the un-cynical independent voter, it may sound as if some conservatives are buying the fable of "unfettered capitalism" rather than concentrating on unfettered government. Now, Gingrich points out that criticism of a single institution is not an attack on the entire free market. This is true enough. Yet when Newt claims that Romney has operated in a "flawed system" wherein "a handful of rich people … manipulate the lives of thousands of other people and walk off with the money," he is only a couple of pup tents removed from a Zuccotti Park mob or an Obama stump speech.
Hey, the plutocracy is a downer. So, is there a particular episode of nefariousness that Bain engaged in or some suspect or illegal deal we should know about, or was the company merely profiting from creative destruction, the sometimes painful but necessary function of capitalism that progressives and jilted presidential candidates find so distasteful? Or is being a filthy-rich dude enough evidence for a conviction?
According to The Wall Street Journal, Bain produced about $2.5 billion in gains for its investors in nearly 80 deals on $1 billion invested during Romney's tenure. (Just to be clear, these were voluntary "investments" with risk and consequences attached, not a Solyndra-style "investment.") "Bain recorded roughly 50 percent to 80 percent annual gains in this period," says the Journal, "which experts said was among the best track records for buyout firms in that era."
That is what fellow Republican candidate Rick Perry describes as "vultures" who wait "for companies to get sick and then … swoop in (and) eat the carcass."
…Or maybe turn companies around by finding efficiencies and cutting waste. Or perhaps they extract whatever worth they can from a dying company (dying long before Bain ever got its talons into them) and reinvest those profits in a new venture. Or maybe they keep the profits and buy stuff. Whatever the case, what they do is a lot more useful than a lifetime of Texas politics.
No doubt you've heard that Romney hasn't helped his cause. He said, "I like being able to fire people." Though, less mentioned is the rest of the sentence: "…who provide services to me. You know, if someone doesn't give me the good service I need, I want to say, you know, that 'I'm going to go get somebody else to provide that service to me.'"
Terrible, is it not? The rich are not only crushing the middle class but also sadists about it. Naturally, Newt, Perry and Jon Huntsman all jumped on the "gaffe" even though they knew well that Romney was (ironically, considering his support of an individual mandate) making an argument for economic choice.
Now, to be fair, left-wing economic populism is, for the most part, only being employed by a gaggle of egomaniacs running for president and doesn't seem to stem from any grass-roots pressure.
But what happens if the attacks work? How many other Republicans will start bemoaning the evils of greed for political expediency? Unlike investment banking, politics is about risk-aversion. Though Americans are fond of economic freedom in the abstract, they also value a stability that healthy capitalism can't always provide. Macroeconomic truths are not easily synthesized into political talking points, nor are they the sort of thing that can emotionally connect a candidate to his constituents. Plying class envy is seductive. And destructive.