tag:blogger.com,1999:blog-7844434945868494835.post6060468188907996938..comments2024-03-27T06:22:08.326-04:00Comments on Douglas Whaley: Mitt Romney, Leveraged Buyouts, and Moralitydglswhaley@aol.comhttp://www.blogger.com/profile/06014306127062171178noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-7844434945868494835.post-83051055136346843892012-10-05T11:18:51.758-04:002012-10-05T11:18:51.758-04:00Your argument is exactly what Bain would say to ju...Your argument is exactly what Bain would say to justify what it does, but here is what’s wrong with that, and with the analogy to hiring a lawyer. If a company is ailing and needs help or legal assistance, it can go out into the marketplace and hire such aid. Whoever it hires will be paid a just salary for its assistance or legal advice, and will have to satisfy the client or be fired. With an LBO the “client” has no choice. Its stockholders sell the stock to an entity whose goal is not primarily to help the target company, but to loot it of its remaining available assets, saving the company only if enough is left over to do so. The other creditors and the employees have no voice in the matter. This is ugly stuff, and if you read the cited Rolling Stones article it will show you that Bain did this over and over again.dglswhaley@aol.comhttps://www.blogger.com/profile/06014306127062171178noreply@blogger.comtag:blogger.com,1999:blog-7844434945868494835.post-38344071171496861522012-10-05T11:17:27.424-04:002012-10-05T11:17:27.424-04:00This comment has been removed by the author.dglswhaley@aol.comhttps://www.blogger.com/profile/06014306127062171178noreply@blogger.comtag:blogger.com,1999:blog-7844434945868494835.post-18215346628786301632012-10-05T02:20:16.828-04:002012-10-05T02:20:16.828-04:00I found your post while searching for "what i...I found your post while searching for "what is a leveraged buyout?" I must admit you do a great job of painting a bleak picture. Perhaps it's even acurate. With all sincerity I have to ask, if these businesses are "ailing", as you say, what other course of action is available to them? Bain was able to save some businesses and get them back in the black, while other companies, despite Bain's best efforts, still failed. If my business is failing, what alternatives do I have? On the other hand, if I'm a corporation who specializes in providing countless hours of management, advice, counseling (and whatever else is involved) to get a business back on track, what incentive can a failing business provide me for my expertise? The business is ailing! They cannot afford to hire a management firm, let alone a lawyer. The risk is great that despite my best efforts the business will fail and, just like all of those other creditors, I will never see a dime for my work. I'm not for or against LBOs. I'm trying to understand what options might be available to a company. Bankruptcy? Bailout? Aren't those dishonest to creditors?<br /><br />On the other hand, in an LBO, if the company makes money, does it pay off it's creditors? So everyone wins?<br /><br />Leveraged Buyout firms like Bain seem no more dishonest than law firms. But despite the awful reputation lawyers get, I see the value a good lawyer can provide if he aims to be honest and provide valuable service to his clients. Sometimes it works out. Sometimes the client still loses lawsuits — either way, the lawyer needs to be paid for his service.<br /><br />Please engage me in an intelligent discussion. I'm eager to learn and make the right decision in 2012. Right now, I believe Romney is our best choice. He knows how to cut spending (even if I lose my job) and foster growth in new areas (a new job for me, perhaps in a new field).Clarknoreply@blogger.com