Ann Coulter’s latest column is a fiery but likely flawed defense of Bain Capital’s record at Ampad.
She admirably and to my knowledge almost uniquely points out that Romney stalker Randy Johnson, who is habitually portrayed in the press as just another worker at the Marion, Indiana plant which Ampad closed after months of failed attempts to work out a union contract, was actually the head of that union. Yes, that’s pathetic, DNC-driven media bias. (Update: Geez Ann, I gave you too much credit. You may consider it quibbling, but Johnson is described as a “vice president” in the first two links contemporaneous to the time of the Marion, Indiana strike in 1994-1995 listed here. And yes, Ann, it matters. He could still have been the union “head” at the Marion plant as I described it if the local represented multiple locations, but it appears that he wasn’t the local’s “president” at the time.)
Coulter also does a generally good job of wading through Ampad’s history, but in my view blows the big picture:
Alas, people kept using those damn computers and shopping for discount paper at Staples and similar stores, and in 1999, Ampad had to file for bankruptcy protection.
Trouble is, the former isn’t true, and Ampad failed to adapt to the latter, despite the fact that the industry was still growing.
The implication Coulter wishes to convey is that paper consumption was in decline. It’s wasn’t. The graphic here, which goes from 1960 to 1995, shows that paper consumption (primary and recycled combined) was still rising in the mid-1990s. A presentation found here from the Georgia Institute of Technology notes that “U.S. Pulp and Paper industry consumption peaked circa 2000.” But if you take away a significant drop in newsprint production, the rest of the industry’s production was still rising, if slowly. “Printing and writing” production increased by 1.7% between 1990 and 2004 — obviously not spectacular, but not a decline.
Ampad declared bankruptcy in 2000 (according the linked Boston Globe graphic) after going public only four years earlier, and liquidated the next year.
Coulter’s conclusion: “Contrary to every single news report on Bain’s involvement with Ampad, Bain did not drive the company to bankruptcy by looting it. To the contrary, Bain built up the company, added other companies to it, turned it into a ‘profitable competitor’ that paid handsome dividends for a few years.”
Here’s Blumer’s alternate take: Bain’s nimbly orchestrated acquisitions and IPO went well. But in a stabilizing but still-growing market, Bainsters led by Romney who were really good at moving money around and structuring companies knew little to nothing about properly managing the operations of the enterprise it had assembled, failed to acquire the needed expertise, and stood by helplessly as their once-beautiful edifice unraveled (while still making sure they got theirs until shortly before the company hit the wall). This isn’t “looting,” of course, but it certainly pokes Swiss cheese-sized holes in Romney’s “great businessman” meme; one can certainly “drive a company into bankruptcy” without meaning to.
The truth about Ampad would seem to have implications which tie into a president’s ability to rein in that out-of-control entity known as the federal government.
So who’s right, Coulter or Blumer?
Only Mitt Romney can tell us, and it’s apparently beneath his dignity to explain what really happened in a manner the average person will understand.
Which is okay by Ann Coulter, who thinks that it’s an absolutely impossible task for Mitt Romney to explain the substance of his business career to the average person:
I don’t know how Mitt Romney is supposed to explain free market capitalism to career politicians, much less describe the intricacies of a thousand business decisions in two minutes during a debate.
If he can’t explain the history of even one Bain investment quickly and succinctly (as stated numerous times, he’s had 17 years since Ted Kennedy hit him over the head to do so, and hasn’t), how are we supposed to expect him to explain to the American people how to transform government, appropriately cut spending, reform the tax code, control the borders, maintain our military strength, etc. etc., in terms they will readily understand?
If Romney really can’t do that, he doesn’t deserve to be president.
If Romney won’t do it, he doesn’t deserve to be president.
Thanks for making that clear, Ann.
UPDATE: Over at the Daily Bellwether, Bill Sloat has identified another Bain investment which arguably fits the “They bought it, but couldn’t run it” model. I suspect there’s a pattern here — even beyond what was identified in the New York Post a year ago.
UPDATE 2: Sloat’s post (and, I suspect, the sagas of other Bain investments) explains why any attempt by Romney to do what James Pethokoukis at the AEI’s Enterprise Blog suggests won’t work.
Romney’s Big Argument, by contrast, could center around how crony capitalism created the housing and financial crisis (via Too Big To Fail and pro-housing policy/Fannie-Freddie) and saps growth by directing capital (via all manner of tax breaks and regulation) toward unproductive areas of the economy. Oh, and it’s bankrupting us. Time for free-market capitalism and less government. That could be a winning message.
Maybe, but not with this messenger (obviously, Gingrich also has some issues in this arena). Sloat’s post notes that Bain’s laundry machinery company got taxpayer economic development subsidies when it moved operations from Cincinnati to Florida, and again when it moved several years later from Florida to Wisconsin before the Bain sold the operation to another investment firm. While not directly “crony capitalism,” Bain’s history of using economic development funds weakens the “I’m here to stop the favor-granting merry-go-round” argument.