Capitalism’s worst enemy

No, it isn’t any of the various Lefty -isms you’d care to name. Not really.

Any criticism of Bain, much less a criticism of how our possible nominee ran the firm, is an attack on free markets and capitalism.  Or so we are being told.

No, it’s not.

It isn’t. It really isn’t. Just because some Romney bootlicks want to conflate a component of capitalism with the totality of free-market capitalism–which hasn’t existed in this country for a very long time now anyway–doesn’t mean it’s actually so.

There has been, in many Republican circles, something of a freak-out that anyone would dare try to paint an operation such as Bain in an unflattering light. To do so, they argue, constitutes an indictment of the free market itself.

For Republicans who are boosters of Romney, this is a perfectly understandable reaction. But I would argue that for more disinterested conservatives, there is no positive duty to mount the barricades and defend Bain from being looked at critically. Here’s why.

I was gonna excerpt a lot more than this, but again, this is one you’re gonna want to read all of. This is something I’ve thought a lot about over the years, even well before I started this blog. On The Great Inevitable Electable specifically, I’m going with Dan McLaughlin:

So, I don’t like seeing pro-free-market Republicans attacking the concept of what Bain does, any more than I liked seeing Romney attack Rick Perry from the left on entitlements. But just because the role of red-in-tooth-and-claw capitalists is a crucial and necessary one does not mean that they are likely to be popular candidates in today’s general election environment. Criminal defense lawyers, for example may be crucially necessary to our system of justice, but if they have represented a lot of unpopular clients, they are not likely to be politically viable. I continue to think that Romney’s business record is an under-explored political vulnerability (one Ted Kennedy used against Romney in 1994, but didn’t even use all the ads he cut) that the Democrats will exploit ruthlessly.

The other point I would make about integrity is that it goes close to the core of why a Romney nomination worries me so much: because we would all have to make so many compromises to defend him that at the end of the day we may not even recognize ourselves. Romney has, in a career in public office of just four years (plus about 8 years’ worth of campaigning), changed his position on just about every major issue you can think of, and his signature accomplishment in office was to be wrong on the largest policy issue of this campaign. Yes, Obama is bad, and Romney can be defended on the grounds that he can’t possibly be worse. Yes, Romney is personally a good man, a success in business, faith and family. But aside from his business biography, his primary campaign has been built entirely on arguments and strategies – about touting his own electability and dividing, coopting or delegitimizing other Republicans – none of which will be of any use in the general election. What, then, will we as politically active Republicans say about him? I was not a huge fan of John McCain’s record, but I was comfortable making honest points about the things McCain had been consistent on over the years – national security, free trade, nuclear power, public integrity, pork-barrel spending. There were spots of solid ground on which to plant ourselves with McCain, and he had a history of digging himself in on those and fighting for things he believed in. But Mitt Romney’s record is just one endless sheet of thin ice as far as the eye can see – there’s no way to have any kind of confidence that we can tell people he stands for something today without being made fools of tomorrow. We who have laughed along with Jim Geraghty’s prescient point that every Obama promise comes with an expiration date will be the ones laughed at, and worse yet we will know the critics are right. Every time I try to talk myself into thinking we can live with him, I run into this problem. It’s one that particularly bedeviled Republicans during the Nixon years – many partisan Republicans loved Nixon because he made the right enemies and fought them without cease or mercy, but the man’s actual policies compromised so many of our principles that the party was crippled in the process even before Watergate. We can stand for Romney, but we’ll find soon enough that that’s all we stand for.

That about covers Romney as far as I’m concerned. As for crony capitalism and Bain itself: from everything I’ve seen and heard, Bain hardly fits the “vulture capitalism” description self-servingly proffered by Perry and Gingrich. Quite the opposite, in fact: Bain would seem to be one of the better examples of the benefits of venture capitalism and creative destruction. Which means neither that there are NO “vulture capitalists” out there; nor that crony capitalism isn’t a huge problem, albeit a different one that what Bain represents (if it represents one at all); nor that Ogabe won’t be using criticism like Perry’s and Gingrich’s against Romney himself; nor that such criticism won’t resonate with the great mass of ignorant and/or misinformed voters out there. When all’s said and done, though, Hayward’s analysis is the one that sticks with me:

The pursuit of profit is often equated to “greed.” Greed is unjustified – the hunger for that which has not been earned. It is also short-sighted and destructive, which is what critics have in mind when they castigate investors for descending upon a company like predators and disemboweling it. Mitt Romney’s company, Bain Capital, specialized in buying troubled companies and attempting to turn them around.  How many of those companies would have perished completely without their investment?

In order to characterize their behavior as “greedy” and short-sighted, it would be necessary to demonstrate that either their acquisitions would have fared better without their involvement, or that Bain could have made different decisions that would have paid off better for their investors in the long run. How many of Bain’s armchair quarterbacks are up to the challenge of making such a demonstration?

That’s one of the great logical flaws in the populist assault against profit: even if we were prepared to concede that a certain level of profit is unacceptable, the would-be commissars lack the tools to measure all the factors that went into a given large-scale investment. What dollar value can be assigned to risks that were taken, and other opportunities that were passed up on? The denunciation of profit is an act of intellectual arrogance, in which the populist declares that all of the many things he doesn’t know are irrelevant, and the superior knowledge of investors and management is without value.

One more time: you’ll want to read all of this one. His “crucial paradox” formulation is especially on-target.

Update! On the other–what is this, the fourth or fifth?–hand…maybe it is crony capitalism after all.