If You Think Unemployment Is Bad Now, Just Watch Mitt Romney Make These Look Like The Good Old Days

In the past we've talked a bit about the role of Bain Capital in the demise of Warner Bros. Records and how, despite Romney's campaign being predicated on his role as a "job-creator," Bain has always been known as a notorious job destroyer. At my own company, Warner Bros, where I was a divisional president (Reprise Records), the Bain experience has left the company hollowed out and on the verge of bankruptcy. More than 75% of the employees have either been "laid off," retired early or have quit in disgust.

And that doesn't include the destruction of the business model. Warner Bros has always been the artist development label. Reprise was specifically founded by Frank Sinatra as an artist-friendly label. And there was only one president of Reprise after Sinatra-- me. And, if it's possible, I was even more artist friendly than Frank! We lived for artist development. Let me explain what that means, because it is absolutely hated by Republicans, conservatives and, needless to say, Bain Capital.

The best A&R executives find artists because they hear something that can develop in into popular music in the future, rather than in the past. I'm not being snarky. That's exactly what I mean. Let me use, as an example, one of my own mentors, someone who brought me into Warner Bros and gave me my first "real" job, Seymour Stein. He was the president of Sire Records and he made me General Manager. He would find artists and I would figure out how to "break" them. He had an uncanny knack for hearing in a song or a performance-- hopefully both-- something that would be blossoming into where popular music was headed. There were no bidding wars for most of the artists Seymour signed. No one else really "got" Depeche Mode, Erasure, The Smiths, Ice-T, k.d. lang, Barenaked Ladies, The Cult... let alone The Ramones or even Lou Reed after his career was pronounced "over," which was right before Stein signed him and he released the platinum New York album, his biggest smash in decades. These all took some "development" before they started making smash hits. Development means investment. It meant, in the case of, let's take Depeche Mode and Barenaked Ladies, putting out 6 albums with very sparse sales before the big breakthrough. Every year Stein and I would be called on the carpet by the corporate types demanding we drop these "worthless artists." Stein, a scrapper from the Bronx, taught me how to politely tell these corporate bean counters to butt out. Lucky he was willing to hold so firm. When Depeche Mode and then Barenaked Ladies, had their breakthrough albums, not only did they start selling platinum on those and on future albums, but their gigantic unexploited catalogues-- 12 LPs between them-- started selling. Each band sold millions and millions of records and generated millions of dollars in profits.

And let me tell you something very simple that Wall Street and the Bains of the world never got about the music business. Back when I was working at Warner, the average cost of marketing a new record was over a dollar, sometimes over two dollars, per album sold. That's A LOT. The average cost of marketing a catalogue record-- like those 12 "worthless" Depeche Mode and Barenaked Ladies albums: between one and two cents each. Calling Mitt Romney "highly qualified," as a clueless Inside the Beltway hack did in yesterday's Washington Post, misleads the readers and just regurgitates, without any examination whatsoever, Romney's most important self-aggrandizing talking point. Not only is Romney not "highly qualified," at least based on his business record, he isn't even a teensy weensy bit qualified.

Not only are 75% of the employees gone from Warner Bros, all those hit artists and scores of other hit artists are gone too. Does that count towards the unemployment Bain Capital has helped to create? Forget for a moment that Romney was a spectacularly failed one-term governor of Massachusetts-- who left office despised by his constituents-- because of his unfathomably awful record on employment. If you examine his record at Bain-- a vulture capital firm concerned with generating quick, short term profits exclusively for people who are already fabulously wealthy and at the cost of jobs, careers, the environment and the long-term stability of company after company-- you can make a case that Romney was a success, but only ever for the one percent-- and always a disaster for the 99%.

Last week one of Romney's former colleagues at Bain came forward and laughed at the very idea that there was any job creating going on there. Pat Garofolo put the story together for Think Progress:

Bain’s model for creating profit was to buy up companies and, as the Los Angeles Times put it yesterday, maximize profits “by firing workers, seeking government subsidies, and flipping companies quickly for large profits.” In fact, one of Romney’s former partners at the firm said that he never saw his role as that of a job creator, undermining one of Romney’s top selling points:

Bain managers said their mission was clear. “I never thought of what I do for a living as job creation,” said Marc B. Walpow, a former managing partner at Bain who worked closely with Romney for nine years before forming his own firm. “The primary goal of private equity is to create wealth for your investors.”

Plenty of the former employees of companies that Bain bought would certainly agree with that assessment. For instance, Bain Capital formed GS Industries by snapping up steel companies. GSI went bankrupt, and “more than 700 workers were fired, losing not only their jobs but health insurance, severance and a chunk of their pension benefits. GSI retirees also lost their health insurance and other benefits.” However, “Bain partners received about $50 million on their initial investment, a 100% gain.”

Over the years, Bain caused several corporate bankruptcies and thousands of layoffs, enriching investors at the expense of workers at firms like American Pad & Paper, Dade International, and LIVE Entertainment. And while Romney is trying to spin this record into something giving him job creation expertise, even his former colleagues are evidently not buying it.

It will be a disaster if American voters don't get an opportunity to understand Romney's actual role as a "job creator" before the election. His actions did help to create jobs-- and industries-- in China and other low wage economies, but for America, Mitt Romney has been an icon of the greed and selfishless of the 1% that have driven our economy into the ditch it's still in. Remember, when no one in America bought this song, which could be interpreted to be about Wall Street, retarded suits demanded we drop the band: