NY Times: After a Romney Deal, Profits and Then Layoffs

Happens that they fail "all the time" too, but only after sucking out millions in management fees for themselves at the expense of shareholders and employees.

The efficiency gains businesses trumpet often lead to only short-term gains, exposing the business to higher risks in the future (because you've eliminated the buffer). American managers think simply mirror the processes that have worked well in Japan. But it's the culture of responsibility that matters a lot more--and in America, unlike Japan, it's only the low-level employees that have to bear it.

 

Our tech industry has been pretty much built by private equity firms.

 

He's within his rights to run a business that way. And the public is within their rights to find it distasteful and weigh whether they want that in a chief executive.

 

You can't apply business logic to government, because government can't make a profit. Business and government are not, in fact, the same thing.

 

Who says so?

 

That's a very misleading statement. Yes, our tech industry has benefited from the investment of venture capitalists, which one could term, by definition, "private equity". But the discussion in this thread is clearly focused on a very specific strategy involving leveraged buyouts, which I think you would agree involves a very different business model.

Your reasoning could justify anything "bad" by simply broadening its categorical definition to include other actions one might find "good". For example:

Person A: The person that brutally murdered the widow for the $4.32 in her picket is bad.
Boom: But the Navy SEALS killed bin Laden.

Not a very persuasive tactic.

Better would be to point to specific example of turnarounds where a PE firm came in and implemented these processes in a way that benefitted all stakeholders, which I'm sure exist--maybe even in the tech area. Then we'd be on our way to a substantive debate instead of you trying to wiggle your way out of it through semantics.

 

The article focused on one company -- a company that was eventually sold for $7 Billion.

It touched on the success of Staples.

You could just have easily written a glowing article about all the jobs he helped create at Staples and the Home Depot, and just touched on this company.

It's all in how you frame it.

They didn't even try to quantify if net net he created "or saved" more jobs than he "destroyed".

The guy is literally one of the best ever at building and running companies.

Then he saved the Salt Lake Olympics.

 

People who think (a) all business leaders-cum-politicians are Republican and (b) ergo all of them want to destroy government when they take over should educate themselves about this guy, who I would argue is one of the most successful, and under-the-radar government executives of the past 20 years:

http://en.wikipedia.org/wiki/Phil_Bredesen

 

Again I've never been a Romney fan that is clearly well documented here at SJ. Just saying it's not fair to paint with a broad brush what private equity firms do.

 

Only because it's what the Times focused on.

Romney & Bain also invested in -- and helped run --start-ups.

 

But that Romney also ran and invested in start-ups is irrelevant to his decision to use this particular business strategy. I take the article not to say "Aha, Romney's actually a terrible businessman!" but rather than he was willing to do something people might consider a net negative for society.

 

Fine. If that's all you were trying to do, I overreacted. But it would help to make more clear what point you're trying to prove.