The Progressive Populist Today Blog: Editorial: Defeat the Vultures

Saturday, October 27, 2012

Editorial: Defeat the Vultures

The presidential race is entering the stretch run and it’s still too close to call, which is good news for the TV stations in the eight or nine battleground states who have political ads lined up to run for every available commercial minute, but for the rest of us it’s pretty nerve-wracking.

The third and final debate was supposed to be on foreign policy but still managed to occasionally find its way back to the economy and other issues of interest to Ohio, which seems to be the only state that really matters to the candidates. But that’s OK because I live in Texas, and thank goodness the Lone Star State is not the bellwether for the nation.

You might remember Rick Perry, our governor for life, from his brief foray into the GOP presidential campaign. A tea partisan by the name of Ted Cruz got the nomination for the US Senate and is the odds-on favorite to win the general election by convincing his fellow Republican primary voters that conservative Lt. Gov. David Dewhurst (R) was too moderate to trust in Washington. Cruz is so far to the right that his Democratic opponent, Paul Sadler, a former state representative, got the endorsements of the Dallas Morning News, El Paso Times, Fort Worth Star Telegram and the San Antonio Express-News, but Cruz has raised $3.5 million since the primary while Sadler raised only $358,734 (and was glad to get that) during the third quarter. The once-proud Texas Dems haven’t won a statewide race since 1994. A YouGov poll of likely voters in Texas, released Oct. 16, found Mitt Romney leading President Obama 55-41 and Cruz leading Sadler 51-36. At least we don’t have to watch those endless attack ads.

It’s frustrating to hear working people say they’re supporting Romney because he was a successful businessman, as if his experience as a predatory capitalist had anything to do with improving the lives of working people and their families. As our cover story by Gary Cohn notes, Bain Capital under Romney’s leadership gained control of GS Industries, a Kansas City steel maker, in 1993, and Bain put the company in bankruptcy in 2001, when Romney was still listed as CEO. A few months later, Bain announced that it was reneging on its promise to provide lifetime health insurance for retirees to improve its bottom line.

Romney claims he’s been out of Bain management since 2002, but he still has a financial interest in the firm, and he has a history of playing fast and loose with the facts. And Greg Palast recently uncovered Romney’s recent ties with vulture financier Paul Singer, who has made a specialty of buying up debt bonds at a few cents on the dollar and then using political connections to collect on the bonds. Singer’s vulture fund bought debt from Third World countries, such as the Congo, and then seized $90 million from foreign aid to that embattled nation, which could have been used to end a cholera epidemic, among other things. Singer’s tactics are outlawed in Britain and all over the world, Palast noted on Amy Goodman’s Democracy Now! show on Oct. 18, but it is still legal in the US, where Singer’s vulture fund feasted on the corpse of another victim, the once-world-leading Delphi auto parts division of General Motors (see Dispatches, page 5).

Singer, with the participation of Ann Romney, and other hedge funders bought stock in Delphi at 67 cents a share, threatened to shut down the parts supplier — which would have put GM and Chrysler out of business — if the government didn’t go along with their takeover. The government knuckled under, which kept the steering wheels and steering columns coming. GM and Chrysler survived but the hedge funders profited enormously as the government took over Delphi’s pension obligations and the new Delphi management shut down 28 of 29 parts plants in the US, costing 25,200 UAW members’ jobs as the factories were moved to China. The revived Delphi stock rose to $22.

“Mitt Romney said, ‘Let Detroit go bankrupt.’ And everyone thought this was a great, principled position,” Palast told Goodman. “And yeah, he wanted it to go bankrupt so that he could buy the auto parts division for literally pennies, 67 cents a share, then flip it for 30, 40 times that amount. In addition, don’t forget that this is TARP money. This is money that comes from the US taxpayer.”

Palast also explained that Singer is probably the most important of Romney’s coterie of billionaires, as the original $1 million donor to the 37-billionaire PAC called Restore Our Future. “He’s the guy who kind of signals all the other billionaires where to put their money. So, Singer is very, very important to Mitt Romney.”

But as Singer buys companies out of bankruptcy, he also, in effect, buys Third World nations out of bankruptcy, picking up their debt for pennies on the dollar and then holding their assets for ransom. Secretary of State Hillary Clinton has led the Obama administration’s effort to put Singer out of business, saying his vulture tactics are a threat to the world economy. That may have played a major role in motivating Singer’s political intervention. Romney’s top foreign policy adviser and potential secretary of state is Dan Senor, who now works for Singer’s hedge fund, Palast noted.

Among other things, Senor, a hawkish protégé of wrongheaded neocon Bill Kristol, was the George W. Bush administration’s spokesman during the occupation of Iraq. Senor went to work on Wall Street after he left the Bush administration. He has advised Romney on foreign policy since 2006. As Romney’s senior foreign policy adviser, he has backed an Israeli strike on Iran and promoted Jerusalem as the capital of Israel. During Romney’s trip to Israel in July, Romney cited Senor’s book about Israeli entrepreneurship in his heavily criticized remarks that suggested economic disparities between Israelis and Palestinians could be chalked up to “culture.”

If Senor was the one who advised Romney that Syria is Iran’s path to the sea, as Mitt Romney said during the foreign policy debate on Oct. 22 (Iran borders the Caspian Sea, the Persian Gulf and the Gulf of Oman, but not Syria), Senor’s grasp of the Middle East apparently is not much better than mentor Kristol’s, who famously played down the differences between Sunni and Shi’ite Muslims before the 2003 invasion of Iraq.

If you think the Obama administration is not hard enough on the malefactors of great wealth who drove the world into the economic ditch during the Bush Jr. administration, the prospect of a Romney administration should scare you. After all, Obama alienated Wall Street by backing the modest reforms of the Dodd-Frank bill in 2010 that tried to put some regulations back on the Wall Street casino — and that’s another bill that Romney would try to repeal on his first day in office.

Senor’s prominence in Romney’s circle of advisers foreshadows a foreign policy that would take a harder line against Iran, which probably would backfire by forcing moderate Iranians to embrace patriotic anti-Western views; he would embrace Jerusalem as the capital of Israel, which would alienate Palestinians as well as Arab neighbors; and he would give a green light to vulture capitalists such as Paul Singer to continue their buccaneering at home and abroad with the full faith and credit of the State Department as well as the US Treasury.

As election day approaches, vote early if you can. Celebrate if you can vote for a progressive Democrat (or independent, such as Sen. Bernie Sanders in Vermont), but settle for centrist Dems against nearly all Republicans. As we discovered after the 2010 election debacle, when progressives withhold votes from Democrats and let new Republican majorities push through draconian changes in a dozen states while they blocked progressive initiatives in Congress, the people who were punished are jobseekers who must forget about extended unemployment benefits; teachers and other public employees who find their pensions under attack to cut taxes for the rich; mothers in low-income families who find their food-stamp allocation shrinking and women’s health services cut off; and high school graduates who find that their only route to college runs through military service in Afghanistan and other hotspots to be determined because state lawmakers have reduced higher education appropriations and congressional Republicans have targeted Pell Grants. Elect candidates who will help. — JMC

From The Progressive Populist, November 15, 2012