Against business? GOP split on Romney’s practices

Repub­li­can pres­i­den­tial can­di­date and for­mer Mass­a­chu­setts Gov. Mitt Rom­ney steps off his cam­paign char­ter plane in Colum­bia, S.C., Wednes­day, the day after win­ning the New Hamp­shire pri­mary. (Asso­ci­ated Press | Charles Dharapak)

TOM RAUM

Asso­ci­ated Press

WASHINGTON — What gives? Some of Mitt Romney’s rivals are wag­ing a fierce attack that you’d never think would come from the mouths of Repub­li­cans who claim Ronald Rea­gan as their hero. They’re blast­ing the GOP front-runner for aggres­sive, wealth-creating busi­ness tactics.

The crit­i­cism, mostly from for­mer House Speaker Newt Gin­grich and Texas Gov. Rick Perry, didn’t seem to mat­ter much in New Hamp­shire, where Rom­ney claimed a com­fort­able pri­mary vic­tory. Gin­grich was fourth and Perry was sixth.

But the snip­ing may have more res­o­nance in next-in-line South Car­olina, which is far more eco­nom­i­cally depressed, and in Florida. Both states are strug­gling with high job­less­ness and weak hous­ing mar­kets. South Carolina’s pri­mary is Jan. 21, Florida’s is Jan. 31.

Try­ing to tap into pop­ulist sen­ti­ment, Gin­grich and Perry are accus­ing Rom­ney of being a fat-cat ven­ture cap­i­tal­ist dur­ing his days run­ning the pri­vate equity firm Bain Cap­i­tal, lay­ing off work­ers as he restruc­tured com­pa­nies and filled his own pockets.

A group back­ing Gin­grich is air­ing TV ads in South Car­olina show­ing dis­traught peo­ple who say they lost their jobs to Bain’s restruc­tur­ing prac­tices while Rom­ney was at the helm.

Jon Hunts­man, a for­mer Utah gov­er­nor and ambas­sador to China, at first joined Gin­grich and Perry in the attacks on Rom­ney. But on Wednes­day after his third-place fin­ish in New Hamp­shire, Hunts­man backed away in part from such crit­i­cism while con­tin­u­ing to assail Romney’s four years as Mass­a­chu­setts governor.

The Bain Cap­i­tal attacks are nearly iden­ti­cal to crit­i­cism once lev­eled at Rom­ney by one of the nation’s best-known Democ­rats, Ted Kennedy, when Rom­ney tried to claim Kennedy’s Mass­a­chu­setts Sen­ate seat in 1994. Whether that tac­tic helped or not, Kennedy, who died in 2009, did hold on to his seat.

To hear such accu­sa­tions now from Repub­li­cans — his­tor­i­cally the party of busi­ness and free enter­prise — is par­tic­u­larly notable.

“It’s like watch­ing dogs walk on their hind feet. It’s not impos­si­ble, but it cer­tainly looks odd when you see it,” said econ­o­mist Bruce Bartlett, who worked in the Repub­li­can admin­is­tra­tions of Rea­gan and George H.W. Bush. “I don’t think they seri­ously believe there is any­thing wrong with what Rom­ney did. I just think that they’re try­ing to use any card that they can find in the deck that might give them an edge. It’s sim­ple expediency.”

Rom­ney has shrugged off the fusillade.

“We under­stood for a long time that the Obama peo­ple would come after free enter­prise.” he told reporters as he flew from New Hamp­shire to South Car­olina on Wednes­day. “We’re a lit­tle sur­prised to see Newt Gin­grich as the first wit­ness for the prosecution.”

Rom­ney has repeat­edly touted his busi­ness career as giv­ing him the right cre­den­tials for deal­ing with a tough econ­omy and the know-how to pro­duce jobs. How­ever, in the process of restruc­tur­ing com­pa­nies to make them more prof­itable, many work­ers indeed were laid off. The crit­i­cism from fel­low Repub­li­cans now threat­ens to under­cut Romney’s cen­tral argu­ment that his private-sector expe­ri­ence best posi­tions him to defeat Demo­c­ra­tic Pres­i­dent Barack Obama in the fall.

Gin­grich, mount­ing the fiercest attacks, denies he’s argu­ing against capitalism.

“I am totally for cap­i­tal­ism. … I do draw a dis­tinc­tion between (it) and loot­ing a com­pany,” says the for­mer House speaker. He also asks, “Is cap­i­tal­ism really about the abil­ity of a hand­ful of rich peo­ple to manip­u­late the lives of thou­sands of other peo­ple and walk off with the money?”

Gin­grich was a lit­tle more sub­dued on Wednes­day. With­out nam­ing the for­mer Mass­a­chu­setts gov­er­nor, Gin­grich said at a cam­paign event in Rock Hill S.C., that he wants “free enter­prise that is hon­est. I want a free enter­prise sys­tem that is accountable.”

Perry, mean­while, who ear­lier called Rom­ney a “vul­ture cap­i­tal­ist,” struck a defen­sive tone on Wednes­day. At a stop out­side Colum­bia, S.C., the Texas gov­er­nor said, “I under­stand restruc­tur­ing. I under­stand these types of things.” But, he added, “The idea that we can’t crit­i­cize some­one for these get-rich-quick schemes is inap­pro­pri­ate from my perspective.”

Hunts­man in the past has asserted that “Gov­er­nor Rom­ney enjoys fir­ing peo­ple. I enjoy cre­at­ing jobs.” But on Wednes­day, he pre­sented him­self to South Car­olina Repub­li­cans as a prag­matic prob­lem solver who dis­dains par­ti­san posturing.

“If you have cre­ative destruc­tion in cap­i­tal­ism, which has always been part of cap­i­tal­ism, it becomes a lit­tle disin­gen­u­ous to take on Bain Cap­i­tal,” Hunts­man told reporters in Colum­bia. Instead, he said Rom­ney should be judged on his record as gov­er­nor when “he didn’t deliver any big bold eco­nomic proposals.”

The next two weeks are what Romney’s foes are inter­ested in, with the key pri­maries in South Car­olina and Florida. The Bain Cap­i­tal attacks have opened a rift among Repub­li­cans, with many con­ser­v­a­tive groups and per­son­al­i­ties urg­ing Gin­grich and the oth­ers to tone it down.

Con­ser­v­a­tive radio host Rush Lim­baugh said Gingrich’s lan­guage was “out of bounds for those who value the free mar­ket.” Club for Growth Pres­i­dent Chris Chocola called the attacks “dis­gust­ing.” Steve Judge, CEO of the Pri­vate Equity Growth Cap­i­tal Coun­cil, cited “a lot of mis­in­for­ma­tion” from both par­ties ignor­ing ben­e­fits to the econ­omy from firms such as Bain.

The harsh attacks on Rom­ney reflect the tea party influ­ence on GOP pol­i­tics, resid­ual anger against finan­cial prac­tices that led to the 2008 eco­nomic cri­sis and gov­ern­ment bailouts and a wide­spread desire among con­ser­v­a­tive Repub­li­cans to find an alter­na­tive to Rom­ney. They also come as the Repub­li­can Party becomes increas­ingly blue collar.

But one ris­ing tea party star who has endorsed Rom­ney, South Car­olina Gov. Nikki Haley, said she doesn’t like the crit­i­cism of his busi­ness prac­tices. “It’s a sad day in South Car­olina and across this coun­try if Repub­li­cans are talk­ing against the free mar­ket. Let me tell you that,” she said.

Rom­ney was defended on Wednes­day by Demo­c­rat Steven Rat­tner, a financier who helped lead the Obama administration’s bailout and restruc­tur­ing of Chrysler and Gen­eral Motors. He told MSNBC that, while he intends to vote for Obama, “I think these attacks are unfair. I think Mitt Rom­ney not only had a very suc­cess­ful (busi­ness) career, but Bain Cap­i­tal is a ter­rific first-class firm man­ag­ing money, mostly for endow­ments, for pen­sion funds. … And he did it in a per­fectly hon­or­able way.”

Texas Rep. Ron Paul, who fin­ished sec­ond in New Hamp­shire, and for­mer Penn­syl­va­nia Sen. Rick San­to­rum, who fin­ished fifth, have avoided slam­ming Rom­ney for his Bain record. San­to­rum even defended Rom­ney at a town hall meet­ing Wednes­day night in Colum­bia, S.C.

“It’s this hos­tile rhetoric, which unfor­tu­nately — and I don’t want to stand here and be a defender of Mitt Rom­ney — but unfor­tu­nately even some in our own party now, even some run­ning for pres­i­dent will engage in with respect to cap­i­tal­ism,” San­to­rum said. “It’s bad enough for Barack Obama to blame folks in busi­ness for caus­ing prob­lems in this coun­try. It’s one other thing for Repub­li­cans to join in on this.”

Paul told The Wash­ing­ton Times that “it astounds me” that Gin­grich and the oth­ers would rip Romney’s work as a ven­ture cap­i­tal­ist. “Either they are totally igno­rant of eco­nom­ics,” he said, “or if they know eco­nom­ics it’s just dem­a­gogu­ing for nar­row polit­i­cal points.”

“It’s strange for Repub­li­cans to go after a col­league who’s suc­cess­ful in busi­ness. The argu­ments by Newt Gin­grich could be made by the far left of the Demo­c­ra­tic Party,” said James Thurber, a polit­i­cal sci­en­tist at Amer­i­can University.

Rom­ney has said that, on bal­ance, he took steps that led to the cre­ation of 100,000 jobs.

How­ever, that claim comes from activ­i­ties con­cern­ing only three com­pa­nies, all of them suc­cesses: Sta­ples, Domino’s and Sports Author­ity. And it counts many jobs that were cre­ated after Rom­ney left Bain in 1999. And it ignores job losses at many other firms that Bain invested in or took over.

Posted by AP News on Jan 11 2012. You can follow any responses to this entry through the RSS Feed. Comments can be made below.