Newt Gingrich intensified his attacks on Mitt Romney over his time as an executive at private equity firm Bain Capital, saying the company’s business model was “indefensible” because it “undermined capitalism” and calling some of its returns “suspicious.”
Speaking Tuesday in interviews on "Fox & Friends" and Bloomberg as New Hampshire primary voters headed to the polls, the former House Speaker outlined what he believed to be the difference between noble and ignoble methods of capitalism.
“Look at the one example from The Wall Street Journal story,” Gingrich said on Fox. “To put in $30 million and get back $60 million would have been a fabulous return. To put in $30 million and get back $90 million would be a fabulous return. Did they really need to take out $180 million if, leaving $30 [million] or $40 million, if the company would’ve survived, the people would’ve been employed, the jobs would’ve been there? These are places where they made money while the company went broke.”
Bain Capital specializes in providing financial and management advice, often taking over distressed companies, which in some cases means massive layoffs. Romney contends that the companies Bain turned around more than make up for the layoffs, and that he helped create more than 100,000 jobs during his time there.
But Gingrich likened Bain to so-called "vulture capital" groups that pick weak companies clean.
“The question is whether or not these companies were being manipulated by the guys who invest to drain them of their money, leaving behind people who were unemployed,” Gingrich said on Bloomberg. “Show me somebody who has consistently made money while losing money for workers and I’ll show you someone who has undermined capitalism. … That’s an indefensible model.
“There are some cases that look very suspicious where he and Bain Capital made a lot of money while other people went broke,” Gingrich added.
The former House Speaker said the difference between what Romney did and what more noble financiers do in the free markets is that the latter “shares in the hardships.”
“I’m for capitalism, I’m for free enterprise, I’m for entrepreneurs,” Gingrich told Fox. “There’s a big difference between people who go out and create a company — even if they fail — if they try to go in the right direction, if they share in the hardships, if they’re out there with the workers doing it together. That’s one thing. But if someone who is very wealthy comes in and takes over your company and takes out all the cash and leaves behind the unemployment? I think that’s not a model we want to advocate, and I don’t think any conservative wants to get caught defending that kind of model.”
Gingrich has himself been criticized for using anti-capitalist attacks on Romney that his critics say are liberal arguments that will be adopted by the Obama campaign. The former House Speaker denied this, telling Bloomberg he was only talking about those instances where Bain “made a lot of money and the company went broke.”
“I don’t think I’m using the language of the left. I’m using the language of classic American populism,” Gingrich said on Fox. “Main Street has always been suspicious of Wall Street. Small businesses have always worried about big businesses. I’m very uncomfortable when I see seven or eight banks take 80 percent of the market share and crowd out small independent banks, and I think people have a natural concern when they see financiers come in from out of town, take over a company, take all the profit and then leave people unemployed behind.”
