Firing People for Fun & Profit
After winning the New Hampshire primary last night, Mitt Romney charged that “some desperate Republicans” have joined forces with President Obama “to put free enterprise on trial.”
Newt Gingrich calls Romney a “vulture capitalist” and blasted his work as CEO of Bain Capital as “bankrupting companies and laying off employees.” Rick Perry snidely attacked Mitt for “all the jobs that he killed,” adding “I’m sure he was worried he would run out of pink slips.”
A Wall Street Journal report quoted Jon Huntsman: “What is clear is [Mr. Romney] likes firing people.”
So, did Romney say “I like being able to fire people”? What he said was, “I want individuals to have their own insurance. That means the insurance company will have an incentive to keep you healthy. It also means if you don’t like what they do, you can fire them. I like being able to fire people who provide services to me.”
I, too, like being able to fire companies who don’t adequately supply the services I demand.
Yet, what about Romney’s work at Bain Capital?
Bain Capital took firms having trouble making a profit and attempted to make them more profitable. Sometimes that meant cutting back the work force to avoid bankruptcy, where everyone would lose their jobs. Sometimes it meant cutting up a company and its assets and selling them to entrepreneurs who could do better.
Not all businesses succeed. No surprise, then, that politicians used to spending a seemingly unlimited supply of other people’s money regardless of performance fail to understand this simple reality.
To his credit, Ron Paul defended Romney, saying of Gingrich, Huntsman and Perry, “I think they’re wrong. They are either just demagoguing or they don’t have the vaguest idea how the market works.”
This is Common Sense. I’m Paul Jacob.