The Bankruptcy of Detroit Is a Preview of What Republicans Want to Do to the Rest of the Country

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http://www.alternet.org/tea-party-and-right/bankruptcy-and-privatization-detroit-just-preview-what-republicans-want-do-rest

The Bankruptcy and Privatization of Detroit Is a Terrifying Preview of What Republicans Want to Do to the Rest of the Country

Mitt Romney should be proud of what’s happening in Detroit.

That’s because during his time at Bain Capital, he perfected the type of glorified extortion tactics Rick Snyder and Kevin Orr are using right now rob city workers of their hard-earned pension plans.

When Mitt was running Bain during the 1980s and 1990s, the company made its money by forcing companies into debt and then robbing them blind for every last bit of cash they had.

Bain would take out a loan for, say, a billion dollars. It would then use that billion dollar loan - its leverage - to buy a company. But instead of paying back that billion dollar loan itself, Bain would dump it on the company it just bought. In other words, Bain would make the company it just bought pay for its own acquisition.

[B Calm]

1. K&R

[DonCoquixote]

2. and consider

that Bain will also gain a lot from this, both in sheer loot, and gutted unions.

I may be mad at Obama, disappointed even, but never, ever, for one moment would I forget that having mr Bain capitol as President would not merely be a bad thing, but that he could have been so bad he could make W. look like a circus clown, and that is not with the Mormon prophecy fantasy added to it.

[JHB]

3. Romney didn't perfect that tactic. It was already a tool in the buy-out toolbox.

The Romney angle is useful in providing a familiar name, but the stress shouldn't be solely on him: the problem wasn't just that he was bad. The problem was that he was typical.

What Bain did had become standard operating procedure for corporate raiders, leveraged buy-outs, and what has become called the private equity market. There were dozens - hundreds - of people just like Romney pulling the same tricks and making the same kinds of deals.

Those hundreds of dealers absorbed and gutted thousands of companies, and destroyed hundreds of thousands of good-paying jobs. Not because the companies were "troubled" as often claimed, but just because they weren't sending as much money skyward as Wall Street's analysts thought they were able to.