Mitt Romney. The director and president of this entity is R. He finally included it on his tax return. Because of his retirement deal with Bain Capital, his finances are still deeply entangled with the private-equity firm that he founded and spun off from Bain and Co.
Again, the Romney campaign insists he saves no tax by using them, but there is no way to check this. The mantra of his campaign is that he was a businessman who created tens of thousands of jobs, and Bain certainly did bring useful operational skills to many companies it bought.
But his critics point to several cases where Bain bought companies, loaded them with debt, and paid itself extravagant fees, thereby bankrupting the companies and destroying tens of thousands of jobs.
But his son declined to release any returns through one unsuccessful race for the U. Senate, in , one successful run for Massachusetts governor, in , and an aborted bid for the Republican Party presidential nomination, in These, plus the mandatory financial disclosures filed with the Office of Government Ethics and released last August, raise many questions.
A full 55 pages in his return are devoted to reporting his transactions with foreign entities. Many tax experts argue that the form of remuneration he receives, known as carried interest, is really just a fee charged by investment managers, so it should instead be taxed at the 35 percent rate. Lee Sheppard, a contributing editor at the trade publication Tax Notes , whose often controversial articles are read widely by tax professionals, is nonplussed that the Obama campaign has been so listless on the issue of carried interest.
Even so. The assertion that he broke no laws is widely accepted. But it is worth asking if it is actually true. Romney, like the superhero who whirls and backflips unscathed through a web of laser beams while everyone else gets zapped, is certainly a remarkable financial acrobat.
But careful analysis of his financial and business affairs also reveals a man who, like some other Wall Street titans, seems comfortable striding into some fuzzy gray zones. Curiously, the Romneys appointed Bradford Malt as their trustee. Bain executives will push Skylark to adopt some of the aggressive discounts and advertising campaigns Bain used to increase sales at its Domino's Pizza operation in Japan.
The timing couldn't have been worse: Three years later two of its biggest customers, GM and Chrysler, were in bankruptcy, and auto sales plunged. But Connaughton says Bain's consulting model of private equity worked: They thought it could invest in new technology that increased the share of the electronics it put in each car.
Bain loyalists also reject the charge that the firm has made money by slashing employment and paying itself debt-fueled dividends. Indeed, with these recent investments, there is little evidence it has. A close examination of the odd companies it still holds a stake in, many of which file their financial statements with the SEC, reveals that most have maintained or increased capital expenditures--even as they took on much higher levels of debt.
Pagliuca says he's used to the intense scrutiny his firm is getting because of its famous founder: "The good news is this isn't the first time one of our people has gone into public service," says Pagliuca, who ran for U.
Senate in Massachusetts as a Democrat in and is a principal owner of the Boston Celtics. And he acknowledges Bain could have bought some of its companies at a better time. But again he retreats to a low-bar defense: Almost all have made it through without defaulting. Bain Capital remains very much in the game. The talent is not fleeing for the exits, even after the election scrutiny. Especially once Bain's fees are accounted for? Probably not. See the historic Forbes print issue.
Subscribe here. This is a BETA experience. You may opt-out by clicking here. More From Forbes. And the drama of this rhetorical high-wire act was ratcheted up even further when Romney chose his running mate, Rep.
By selecting Ryan, Romney, the hard-charging, chameleonic champion of a disgraced-yet-defiant Wall Street, officially succeeded in moving the battle lines in the presidential race. Like John McCain four years before, Romney desperately needed a vice-presidential pick that would change the game.
But where McCain bet on a combustive mix of clueless novelty and suburban sexual tension named Sarah Palin, Romney bet on an idea. He said as much when he unveiled his choice of Ryan, the author of a hair-raising budget-cutting plan best known for its willingness to slash the sacred cows of Medicare and Medicaid.
Debt, debt, debt. And this is where we get to the hypocrisy at the heart of Mitt Romney. In the past few decades, in fact, Romney has piled more debt onto more unsuspecting companies, written more gigantic checks that other people have to cover, than perhaps all but a handful of people on planet Earth.
By making debt the centerpiece of his campaign, Romney was making a calculated bluff of historic dimensions — placing a massive all-in bet on the rank incompetence of the American press corps. That same man then runs for president riding an image of children roasting on flames of debt, choosing as his running mate perhaps the only politician in America more pompous and self-righteous on the subject of the evils of borrowed money than the candidate himself.
Four years ago, the Mitt Romneys of the world nearly destroyed the global economy with their greed, shortsightedness and — most notably — wildly irresponsible use of debt in pursuit of personal profit. The sight was so disgusting that people everywhere were ready to drop an H-bomb on Lower Manhattan and bayonet the survivors.
Instead of cars and airplanes, we built swaps, CDOs and other toxic financial products. Instead of building new companies from the ground up, we took out massive bank loans and used them to acquire existing firms, liquidating every asset in sight and leaving the target companies holding the note. A takeover artist all his life, Romney is now trying to take over America itself.
Is America really ready for another Republican president who was a prep-school cheerleader? And like other great presidential double-talkers such as Bill Clinton and George W. Bush, Romney has shown particular aptitude in the area of telling multiple factual versions of his own life story. It was not my desire to go off and serve in Vietnam. Like John F. Kennedy and George W. Then, faced with making a career choice, Mitt chose an odd one: Already married and a father of two, he left Harvard and eschewed both politics and the law to enter the at-the-time unsexy world of financial consulting.
He could have done anything — but what does he do? Romney started off at the Boston Consulting Group, where he showed an aptitude for crunching numbers and glad-handing clients. The reality is that toward the middle of his career at Bain, Romney made a fateful strategic decision: He moved away from creating companies like Staples through venture capital schemes, and toward a business model that involved borrowing huge sums of money to take over existing firms, then extracting value from them by force.
It then puts down a relatively small amount of its own money and runs to a big bank like Goldman Sachs or Citigroup for the rest of the financing. Most leveraged buyouts are financed with 60 to 90 percent borrowed cash.
The takeover firm then uses that borrowed money to buy a controlling stake in the target company, either with or without its consent. World globe An icon of the world globe, indicating different international options. Get the Insider App. Click here to learn more. A leading-edge research firm focused on digital transformation. Good Subscriber Account active since Shortcuts. Account icon An icon in the shape of a person's head and shoulders.
It often indicates a user profile.
0コメント