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August 11, 2011 2:55 PM Corporations and context

By Steve Benen

After an uncomfortable shouting match with hecklers in Iowa this morning, Mitt Romney explained why he’s unwilling to raise taxes on corporations to protect entitlements: “Corporations are people, my friend.” It’s a line that’s starting to generate some attention (and mockery).

Eric Fehrnstrom, a spokesperson for the Republican presidential candidate, is arguing the context makes a difference: “Do folks think corporations are buildings? They’re people who incorporate to conduct business. They create jobs and hire more people.” (Funny, Fehrnstrom and the Romney campaign have never cared much about context before.)

I certainly get the point here. Romney, in his awkward and tone-deaf sort of way, was trying to say he doesn’t want to ask corporations to pay more taxes, because that would mean asking those within the corporations to pay more taxes.

That’s a debate worth having on the merits — it’s about tax policy, not the personhood status of a legal corporate entity — but it raises a related point: why does Mitt Romney believe corporations can’t be subjected to tax increases, but they can be broken up and sold for parts to make Romney rich?

What Romney skips [when talking about his private-sector background] is his experience in eliminating jobs. It’s a facet of his career that presents a particular challenge for the Republican primary frontrunner: Tough business decisions don’t necessarily translate into good politics.

As head of private equity firm Bain Capital LLC, Romney was the lead deal-maker, buying and selling companies to make money for investors. Whether companies boomed or filed for bankruptcy, the Boston-based firm found profits for Romney, its other executives and investors.

Or as Stephen Colbert explained:

“You see, Romney made a Mittload of cash using what’s known as a leveraged buyout. He’d buy a company with ‘money borrowed against their assets, groomed them to be sold off and in the interim collect huge management fees.’ Once Mitt had control of the company, he’d cut frivolous spending like ‘jobs,’ ‘workers,’ ‘employees,’ and ‘jobs.’ […]

“Because Mitt Romney knows just how to trim the fat. He rescued businesses like Dade Behring, Stage Stories, American Pad and Paper, and GS Industries, then his company sold them for a profit of $578 million after which all of those firms declared bankruptcy. Which sounds bad, but don’t worry, almost no one worked there anymore.

“Besides, a businessman can’t be weighed down with a bleeding heart. As one former Bain employee put it, ‘It was very clinical…. Like a doctor. When the patient is dead, you just move on to the next patient.’”

Romney slashed American jobs as if his career depended on it — and it did. Frank Rich recently explained, “In [his 1994 Senate] campaign, Romney was stalked by a ‘Truth Squad’ of striking workers from a Marion, Indiana, paper plant who had lost jobs, wages, health care, and pensions after Ampad, a Bain subsidiary, took control. Ampad eventually went bankrupt, but Bain walked away with $100 million for its $5 million investment. It was an all-too-typical Romney story.”

“Corporations are people”? In this little figure of speech, wouldn’t that make Mitt Romney a metaphorical serial killer?

Steve Benen is a contributing writer to the Washington Monthly, joining the publication in August, 2008 as chief blogger for the Washington Monthly blog, Political Animal.

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  • T2 on August 11, 2011 3:04 PM:

    slightly off topic.....I see where a major Bachmann supported has referred to RIck Perry as a "spoiler" without the proven accomplishments of Michelle. This may be more fun than I anticipated. One thing about Rick Perry - he has a vindictive streak as big as Texas. Bachmann against Perry, if it materializes, will be epic.

  • Christine on August 11, 2011 3:04 PM:

    "In this little figure of speech, wouldn’t that make Mitt Romney a metaphorical serial killer?"

    An excellent question, Mr. Benen. Perhaps Jeffrey Immelt can provide an answer?

  • Josef K on August 11, 2011 3:06 PM:

    why does Mitt Romney believe corporations can’t be subjected to tax increases, but they can be broken up and sold for parts to make Romney rich?

    That presupposes Rommey actually believes in anything, belief implying some kind of steady ethical or moral framework one holds to and refers their actions against.

    Rommey, in contast, reverses himself so many times he might as well change his name to 'dervish'.

  • Julene on August 11, 2011 3:09 PM:

    So why are corporations taxed differently than people then? Someone could ask that question. Why can't I take the deductions over 5 years for buying new furniture or a computer? Can I spread my years of unemployment losses over 5 years, so I don't have to pay tax in any of those subsequent years?

  • Danp on August 11, 2011 3:11 PM:

    wouldn’t that make Mitt Romney a metaphorical serial killer?"

    Or in the case of the companies recently opened and shut to provide political donations to him, maybe abortion doctor would be more appropriate.

  • walt on August 11, 2011 3:17 PM:

    I'm starting to think Romney might be finished. For Republicans, there simply isn't enough to love. "George Bush on steroids"? Like a baby.

  • Kane on August 11, 2011 3:17 PM:

    The Mitt has hit the fan. And he's in Mittload of trouble.

  • Tom Dibble on August 11, 2011 3:18 PM:

    “Do folks think corporations are buildings? They’re people who incorporate to conduct business. They create jobs and hire more people.”

    Well, if corporations are people because they attract people to work at them and pay people for work, then corporations are indeed buildings too because they build buildings or buy/lease them, and fill those buildings with people and things.

    Why the false dichotomy? Corporations are corporations. Might as well be arguing that my car is a person because sometimes it entices me to get in it and make it move.

  • LaFollette Progressive on August 11, 2011 3:25 PM:

    To me, the interesting thing about Mitt's proclamation is this: it would be equally true, by his line of reasoning, that the Federal Government is People.

    One might even notice that it has a fiduciary duty to "We the People", rather than a duty to maximize profits for shareholders.

  • smintheus on August 11, 2011 3:32 PM:

    That's the most curious thing about corporate personhood: corporations can kill and be killed without anybody needing to be held responsible.

  • jpeckjr on August 11, 2011 3:33 PM:

    I was under the impression the US Supreme Court ruled in the Citizens United case that, at least for the purposes of making political contributions, corporations are people, that they have free speech rights just like people do. Am I under the wrong impression?

    Captcha: timplic important. Referring to Tim Pawlenty: Is Tim, like, important?

  • Jamie on August 11, 2011 3:34 PM:

    while we're at it. Do corporations have souls?

  • c u n d gulag on August 11, 2011 3:38 PM:

    Jamie,
    No.
    And neither do the people who run them.

    What's that CAPTCHA girl?
    Mass paysis

    Yes, that's a pretty good way to descibe corporations.

  • epb on August 11, 2011 3:41 PM:

    Mitt = Gordon Gecko.

  • Mnemosyne on August 11, 2011 3:49 PM:

    Imagine for a moment if a Democrat said, "Unions are people, my friend."

    Equally true, but the shrieking on Fox News would never, ever stop.

  • jjm on August 11, 2011 3:52 PM:

    Just a word: Obama gave a fiery speech at a high-tech battery producing plant in Holland Michigan, saying "Don't bet against the American worker" to massive applause.

    And guess who's been betting against the American worker but old Mitt?

  • Objective Dem on August 11, 2011 3:58 PM:

    I wish the media would use this as a moment to discuss the issue of corporations being treated as persons in some cases but not in others.

    I understand the idea of the corporation and am not opposed to having different sets of rights. But unfortunately, the US seems to be creating a monster with the rights of the person with much fewer of the responsibilities. Worse of all, we have a culture that encourages and expects corporations to act in a completely amoral manner strictly focused on making money. If corporations were people they would be sociopaths.

  • Neil B on August 11, 2011 4:04 PM:

    Mittens Romney is a revolting pathetic jackass, a hack, a shameless panderer, a flipflopper - yeah, their "reasonable" candidate (and the corporation's establishment front, he will be pushed into the nomination if they have their way - a perfect counterpart to Roberts and his shoddy crew like former Monsanto hack Thomas who of course didn't recuse himself from the relevant case.)

    Corporations are not persons, they are an extra, artificial entity recognized by the government to have some rights of persons as well as limited liability (the members don't owe from their own fortunes.) Romney is so wrong.

    The government, that is the people, should decide how many rights corporations are *granted* as a *privilege.*) As for "double taxation", well: if you want to enjoy double personhood (your personal rights plus some personal rights granted to the corporation too) then be prepared to pay double.

    Furthermore, we can require quid pro quo about who works for them, such as designated shares of profit (incredible that isn't already done, it's a valid legal rights claim and doesn't happen only because of political influence.)

    BTW the SCOTUS case supposedly giving corporations partial status as persons is bogus anyway, it was misrepresented by the clerk of court who was secretly working on their behalf: http://www.hightowerlowdown.org/node/664 .

    Heh, "skewed"

  • Elie on August 11, 2011 4:18 PM:


    LaFollette upstring -- I like your logic -- and its true as well -- Government IS the people...

    A Democrat (Lord willing), should point out that exact thing to old Mitters and his gang as well as to the republicans...

  • Olof on August 11, 2011 4:21 PM:

    In related news, "Soylent Green is people"

  • Countme In on August 11, 2011 4:23 PM:

    Milton Friedman:

    "The discussions of the "social responsibili­ties of business" are notable for their analytical looseness and lack of rigor. What does it mean to say that "business" has responsibilities? Only people can have responsibilities. A corporation is an artificial person and in this sense may have artificial responsibilities, but "business" as a whole cannot be said to have responsibilities, even in this vague sense. The first step toward clarity in examining the doctrine of the social responsibility of business is to ask precisely what it implies for whom."

    Well, in Chile,, under Friedman's murderous tutelage, it implied throwing people out of airplanes into the ocean. I don't think they ever threw a corporation out of an airplane.

    But I digress.

    Corporations are people?

    Are corporations families, too? I mean, outside of the bullshit boilerplate in the 4-color employee monthly in-house newsletter.

    Are charities people? Ergo, corporations must be charities.

    Churches have steeples and inside are the peoples. What pew do the corporations sit in? The expensive pews?

    Apparently, governments are families, and should sit around the kitchen table discussing whether to carpet-bomb the neighbors or send sis into the street for some extra cash, so we can afford to carpet bomb the neighbors.

    Wait, if government is a family that should be run like a business (the Mafia should be consulted) and families and corporations alike are people, then corporations must be the government. That's what the Supreme Court and Mussolini meant!

    People are soylent green. Corporations are people. Therefore, corporations are soylent green.

    What's for dinner, Mom? We're having News Corporation for dinner, Timmy. We're saving your brother for Thanksgiving.

  • wvmcl2 on August 11, 2011 4:27 PM:

    I still think Romney will be the nominee. All of those polls showing him as the only one with a decent chance of beating Obama will do the trick in the end. Think McCain in 08 or Kerry in 04. Both were written off by the pundits, but the primary voters decided they had the best chance to win, so they held their noses and voted for them.

  • Objective Dem on August 11, 2011 4:43 PM:

    I went to the link cited by Neil B above. I liked a 1964 quote from Lincoln in the article

    “I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. As a result of the war, corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed. I feel at this moment more anxiety than ever before, even in the midst of war.”

  • Clem Yeobright on August 11, 2011 5:29 PM:

    So, Soylent Green is ... corporations?

  • Neil B on August 11, 2011 6:03 PM:

    Tx for quoting, Objective Dem. You meant, 1864. BTW Jefferson expressed similar sentiments 3/4 century before.

  • nonheroicvet on August 11, 2011 6:32 PM:

    Cutting up people into many parts - seems to me that Ed Guien and Jeffrey Dahmler got into a lot of trouble for that - and they didn't even try to sell the parts.

  • Schtick on August 11, 2011 6:46 PM:

    I wanna be a corporation so I can pay the same taxes that they do....none. Can I be a bank? With no soul, of course.

    crapcha....matermatica sionoi....mother what?

  • Lincoln Bormann on August 11, 2011 7:55 PM:

    Thanks for this piece. It so neatly summarizes the Republican strategy for the country, only this time the government (and anyone hoping for a social safety net) plays the role of the hapless victim.

  • Steve P on August 11, 2011 9:29 PM:

    "Did you ever expect a corporation to have a conscience, when it has no soul to be damned and no body to be kicked?”

    Lord Chancellor Edward Thurlow, 1731-1806

    (Mind you, the lack of a conscience has never been a bar to political office, but in business it's an actual liability.)

  • Judy in Ohio on August 12, 2011 1:53 AM:

    Corporations can be bought and sold, as Mitt can tell you. Of course, so could people at one time, but there seems to be near-unanimous agreement that it wasn't a good idea.

  • furiousd on August 13, 2011 2:08 PM:

    This just in, Romney has chosen his V.P. A corporation!

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