Saturday, September 1, 2012

Romney Won't Be Able To Help Workers

David Brooks makes a powerful critique of the Republican Convention:
But there’s a problem. I see what the G.O.P. is offering the engineering major from Purdue or the business major from Arizona State. The party is offering skilled people the freedom to run their race. I don’t see what the party is offering the waitress with two kids, or the warehouse worker whose wages have stagnated for a decade, or the factory worker whose skills are now obsolete.
Brooks and everyone else looking to see what Romney is offering that waitress or factory worker may spend a lot of time searching in vain. In a lengthy article examining Romney's tenure at Bain, Pete Kotz writes,
Yet the smartest guys in the room thought they could run the plant better than the people setting production records.

"They were getting rid of old managers and hiring new managers that didn't have any steel experience," Morrow says. "Some of the guys were nice guys and everything, but they didn't have a clue what was going on."

Many of the new supervisors were ex-military, people who believed that grown men and women are best motivated by punishment. Before Bain, says Morrow, "everybody got along."

Afterward? "They wanted to run the plant like a disciplinary environment. They wanted to discipline people for getting hurt on the job. They wanted to put us in an environment like a war, where we were always fighting with them."

Romney was charging GSI $900,000 a year in management fees to run the company. The Kansas City mill received $900,000 worth of ineptitude in return.

Although Bain borrowed $97 million to retool the plant so it could also produce wire rods, it left the rest of the facility to rot.

To save costs, Bain went miserly on everything from maintenance to spare parts and earplugs. Equipment deteriorated. Because the new managers didn't know how to repair it, "they'd want to rent a new piece of equipment out instead of maintaining what we had," Morrow says. The waste and inefficiency was breathtaking.

Bain's plan all along was to streamline the company into greater profitability, then reap the rewards with a public stock offering. But the exact opposite was happening. Even Roger Regelbrugge, whom Bain installed as CEO, knew the debt was crushing GSI from within, according to Reuters. If a public offering didn't materialize, the company would collapse.

Steel was about to enter a periodic downturn. Countries around the world were locked in a war of tariffs and government-subsidized production, creating a glut and driving down prices. Romney's strategy of the flip was never meant to endure difficult times.

Workers saw the end coming; they were particularly worried that Bain was badly underfunding their pension plan. So they went on strike in 1997, bringing a traditional Rust Belt flair to the festivities by littering the streets with nails and gunning bottle rockets at security guards.

When it was all over, the steelworkers union agreed to wage and vacation cuts in exchange for extra health and pension safeguards should the plant close.
Under a President Romney, workers' protections will be reduced. Workers will be punished for the ineptitude of their managers, and forced to do more with less. Meanwhile, a few investors will make a tidy profit while the workers worry about having enough for retirement and medical emergencies.

Romney and his Randian running mate will produce these results not because they are evil men but because they are professionally and philosophically ill-equipped to deal with a fact that Brooks succinctly asserts:
The fact is our destinies are shaped by social forces much more than the current G.O.P. is willing to admit. The skills that enable people to flourish are not innate but constructed by circumstances.
Throughout most of the summer, Romney tried to make his career at Bain central to his campaign. At the convention, he seems to have wanted to switch gears and make his personal virtues the paramount reason to vote for him. Romney has indeed helped people in need. He apparently acts out of a sense of noblesse oblige in the best understanding of the term. Neither his work at Bain nor his personal benevolence have prepared him to use the levers of power to "construct circumstances" that will allow the waitress, firefighter, or factory worker to recover from the economic hardships they have undergone since 2008.

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