“What most voters don’t know is the way Mitt Romney actually made his fortune: by borrowing vast sums of money that other people were forced to pay back.
This is the plain, stark reality that has somehow eluded America’s top political journalists for two consecutive presidential campaigns: Mitt Romney is one of the greatest and most irresponsible debt creators of all time. In the past few decades, in fact, Romney has piled more debt onto more unsuspecting companies, written more gigantic checks that other people have to cover, than perhaps all but a handful of people on planet Earth.”
Private equity firms are “essentially guys who borrow money to take over companies and extract wealth from those companies to pay off their investors.”
For example: KB Toys. Bain Capital “… took over the company with like $18 million down. They financed the other $302 million. So that’s borrowed money that subsequently became the debt of KB Toys. This is an important distinction for people to understand. When they borrowed that money to take over that company, they didn’t have to pay it back, KB had to pay it back.”
“Romney wrote a book called Turnaround. But they are not in the business of turning companies around and creating jobs. That is a complete mischaracterization. What they’re in the business of doing is repaying the investors who lent them the money to take over those companies. The workers are completely irrelevant in this scheme.”
Matt Taibbi on Democracy Now, August 30, 201