Krugman and Wells: Getting Away with It

Robin Wells and Paul Krugman

Getting Away with It, by Robin Wells and Paul Krugman: In the spring of 2012 the Obama campaign decided to go after Mitt Romney’s record at Bain Capital, a private-equity firm that had specialized in taking over companies and extracting money for its investors—sometimes by promoting growth, but often at workers’ expense instead. Indeed, there were several cases in which Bain managed to profit even as it drove its takeover targets into bankruptcy.

So there was plenty of justification for an attack on Romney’s Bain record, and there were also clear political reasons to make that attack. For one thing, it had worked for Ted Kennedy, who used tales of workers injured by Bain to good effect against Romney in the 1994 Massachusetts Senate race. Also, to the extent that Romney had any real campaign theme to offer, it was his claim that as a successful businessman he could fix the economy where Obama had not. Pointing out both the many shadows in that business record and the extent to which what was good for Bain was definitely not good for America therefore made sense.

Yet as we were writing this review, two prominent Democratic politicians stepped up to undercut Obama’s message. First, Cory Booker, the mayor of Newark, described the attacks on private equity as “nauseating.” Then none other than Bill Clinton piped up to describe Romney’s record as “sterling,” adding, “I don’t think we ought to get into the position where we say ‘This is bad work. This is good work.’” (He later appeared with Obama and said that a Romney presidency would be “calamitous.”)

What was going on? The answer gets to the heart of the disappointments—political and economic—of the Obama years. ...[continue reading]...