Today, the Obama campaign began airing an ad attacking Mitt Romney over layoffs at Bain Capital, which the Obama team is holding up as emblematic of Romney’s economic philosophy. Byron York reports that the Romney campaign has settled on a line of pushback — compare what Romney did at Bain to what Obama did with the auto companies.
“Few remember today how many (non-union) workers lost their jobs in the Obama administration’s handling of the matter,” York writes of the Romney camp’s counterargument. York adds: “in the auto bailouts, whatever else one thinks of them, Barack Obama pushed for downsizing and laying people off in a failing business he had taken over.”
If this is indeed the comparison the Romney campaign plans to pursue, it’s a curious one. After all, Obama didn’t personally profit when he bailed out the auto companies. By contrast, Bain walked away with at least $12 million in profits after its episode involving GST Steel, the company that is the subject of Obama’s ads. More broadly, Jon Chait notes: “Romney’s career produced huge gains for owners of capital, and the auto bailout forced them to swallow huge losses.”
Beyond this, what’s really curious about this counterattack is that it only helps underscore the philosophical difference between the two that the Obama campaign is trying to highlight with the Bain attacks.
Romney defends his Bain years by arguing that any criticism of it constitutes an attack on free enterprise itself. Romney does acknowledge that the layoffs that occured in cases such as that of GST Steel are unfortunate — when turning around companies, you win some, and you lose some. But his philosophy, ultimately, is that such occurences, however unfortunate, are necessary for the greater good, and don’t alter the larger truth: An unfettered free market is the best hope for expanding opportunities for those who lack them. That’s what drives his anti-government rhetoric; he continually tells us that we need to “get government out of the way” to unlock America’s “potential.” Romney believes the best way to to foster shared prosperity is with a near-total commitment to liberating the private sector.
But when Romney invokes the auto bailout, all he does is remind us of an instance where his economic worldview broke down — where his philosophy compelled him to advocate for what likely would have been a disastrous course. This worldview led him to originally argue that the bailout would guarantee the auto industry’s certain demise. This worldview obliges him to continue arguing that the auto industry would be in better shape today than it is now if Obama had not pursued a government “intervention.” Many experts dismiss Romney’s claims about the bailout as thoroughly wrong on several levels .
Obama, by contrast, argues that an unfettered free market is not a total cure-all. He argues that sometimes active government is necessary to help those who have been damaged by free market excess or to step in when the consequences of allowing unfettered capitalism to run its course could damage thousands of lives. In service of this larger point, the Obama campaign is very happy to engage in a dispute over the auto-bailout, a clear cut case where this argument turned out, by most accounts, to be thoroughly vindicated. If anything, invoking the auto-bailout in the context of the battle over the Bain years only reinforces the larger contrast of economic worldviews the Obama team hoped to draw with the Bain ads in the first place.