Thursday, May 24, 2012

The BAIN Initiative

As the 2012 Presidential election heats up, voters are faced with a critical decision: pick a man who has had great success in the private sector, or pick a man who has had great success in the public sector.

It is first important to note there is a stark difference between the private sector and the public sector. Success in one does not necessarily translate to success in the other. Mr. Romney thinks otherwise.

There is no question about Mr. Romney’s enormous success in the private sector. As head of Bain Capital, his work with the private equity firm has created massive payoffs for his investors and has rightfully earned him respect as a triumphant businessman. However, creating wealth and creating jobs are two very different things.

When Mr. Romney touts his private sector experience as “the main calling card for why he thinks he should be president,” his time at Bain Capital must be examined at a further depth.

What must also be examined is his experience in the public sector, primarily as Governor of Massachusetts. Specifically, during his tenure as Governor, Massachusetts dropped to 47th in job creation. He also advocated that we “let Detroit go bankrupt”, criticizing Obama for his Auto-Bailout. But we can all agree that if we took Mr. Romney’s “business” advice, our recovery would be in a much worse position that it is today. Instead of having two and half years of consecutive private sector job growth, our economy would have lost millions of jobs.

No one, including the President, is criticizing Romney’s success at Bain Capital, the private sector, or private equity firms. In fact, President Obama has supported the principles of capitalism to a much greater extent than his opponent (via Wall Street Reform and the Buffet Rule, which promote equality of opportunity, NOT equality of outcomes).

But when Mr. Romney claims that his business experience is the sole reason why he would do a better job as President than Obama, the American people have a right to ask questions. As President Obama mentioned in his press briefing earlier this week:

"When you're president, as opposed to the head of a private equity firm, then your job is not simply to maximize profits. Your job is to figure out how everybody in the country has a fair shot. Your job is to think about those workers who get laid off, and how are we paying them for their retraining? Your job is to think about how those communities can start creating new clusters so that they can attract new businesses. Your job as president is to think about how do we set up an equitable tax system so that everybody's paying their fair share that allows us then to invest in science and technology and infrastructure, all of which are going to help us grow.”


  1. "equality of opportunity, not equality of outcomes" - I can get on board with that.

  2. Basic rule of economics: increased wealth leads to an overall increased standard of living. Jobs that are inefficient should go and be replaced by emerging markets- that is how an economy grows.

  3. To "anonymous" regarding the basic rules of economics: Based on your explanation on the creation of wealth, how would you explain the dismal job growth during the George W. Bush administration (2000-2008) where there was a NET job growth of ZERO private sector jobs; where the middle-class lost tremendous wealth; where the top 2% continued to soar in profits; where we hit the biggest financial crises since the 1940s?


Do You Agree or Disagree? Why? Please leave comments.