The NYTimes story on Apple’s aggressive-but-legal tax avoidance strategies got me to thinking about the Democratic rap against Mitt Romney: He’s had all the advantages in life. He was born with a silver spoon in his mouth. His wealth was built on cutting jobs. He was a corporate raider. He doesn’t pay enough in taxes. He’s a cold-hearted capitalist.
But what if a different sort of CEO were the Republican nominee? Imagine if Steve Jobs a) were alive and b) somehow nabbed the 2012 Republican nomination. What would the Democrats be saying about this beloved American entrepreneur and success story? When he passed, President Obama had this to say:
Steve was among the greatest of American innovators – brave enough to think differently, bold enough to believe he could change the world, and talented enough to do it. By building one of the planet’s most successful companies from his garage, he exemplified the spirit of American ingenuity. By making computers personal and putting the internet in our pockets, he made the information revolution not only accessible, but intuitive and fun. And by turning his talents to storytelling, he has brought joy to millions of children and grownups alike. Steve was fond of saying that he lived every day like it was his last. Because he did, he transformed our lives, redefined entire industries, and achieved one of the rarest feats in human history: he changed the way each of us sees the world. The world has lost a visionary.
Indeed, liberal pundit Paul Begala has made the Jobs-Romney comparison:
Yes, we Americans admire financial success; we don’t hate the rich. But we resent folks who got rich by rigging the system. Romney made millions in part by loading companies with debt, driving them into bankruptcy, and laying off their workers. The workers who lost their jobs had their health benefits canceled as well—but Romney and his partners made millions. That’s not how Steve Jobs got rich.
But if Jobs, or some other similar tech CEO, were the 2012 GOP standard bearer, I imagine we would be hearing this sort of thing:
1. Jobs is out of touch. Jobs, with a fortune of around $7 billion, was way richer than Romney.
2. Jobs is anti-U.S. worker. All those iPads aren’t being made in America, after all. (Of course, they would cost more than twice as much if they were.) And you certainly can’t compare the “App Economy” with an economy based on manufacturing, right?
3. Jobs uses slave labor. See point #2.
4. Jobs is a tax dodger. As the NYTimes story describes Apple’s tax strategy:
Apple was a pioneer of an accounting technique known as the “Double Irish With a Dutch Sandwich,” which reduces taxes by routing profits through Irish subsidiaries and the Netherlands and then to the Caribbean. Today, that tactic is used by hundreds of other corporations — some of which directly imitated Apple’s methods, say accountants at those companies.
Without such tactics, Apple’s federal tax bill in the United States most likely would have been $2.4 billion higher last year, according to a recent study by a former Treasury Department economist, Martin A. Sullivan. As it stands, the company paid cash taxes of $3.3 billion around the world on its reported profits of $34.2 billion last year, a tax rate of 9.8 percent.
5. Jobs is a ruthless capitalist. As he told biographer Walter Isaacson, “I’m going to destroy Android, because it’s a stolen product. I’m willing to go thermonuclear war on this.”
6. Jobs is anti-consumer. Imagine the field day the DNC would have with the antitrust suit accusing Jobs and top executives at five major book publishers with illegally conspiring to raise the prices of e-books, costing consumers tens of millions of dollars.
You get the picture. The Left is uncomfortable, to say the least, with the innovation and creative destruction generated by market capitalism and how it upsets the best-laid plans of government. Recall the president’s comments about job-killing ATMs. A tech CEO would be treated no better by liberals than a private-equity CEO. And Jobs would quickly go from entrepreneurial saint to capitalist sinner.
It’s OK if you’re John Kerry and marry your money. JUST DON’T EARN IT YOURSELF!
Immelt at GE is an even better tax code manipulator, and he’s not reviled by the Democrats.
Jobs was a hippie Buddhist, and a Democrat (Al Gore is still on the board of Apple, that socialist!).
If your point is that the Democrats will attack the challenger to their incumbent president with whatever they think will work, then hats off to you for breaking this story, I see a Pulitzer in your future. Luckily the GOP would never do something like that.
But they are going to nominate another rich kid trying to make up for daddy’s loss to go against the most impotent and centrist Democrat elected in modern American history. This election is going to be super fun!
“Yes, we Americans admire financial success; we don’t hate the rich. But we resent folks who got rich by rigging the system. Romney made millions in part by loading companies with debt, driving them into bankruptcy, and laying off their workers. The workers who lost their jobs had their health benefits canceled as well—but Romney and his partners made millions. That’s not how Steve Jobs got rich.”
Sounds like Obama’s first term.
This isn’t really even worth a comment.
Romney saved companies from bad management and preserved jobs. Sure, in some cases, jobs were lost, but many more were saved.
Do your homework and try to understand what you’re talking about.
SIDEBAR: We need to stamp out stupidity like that of Paul Begala, regarding well- or ill-gotten money.
At one end, there’s Willie Sutton (robbed with a gun) and Bernie Madoff (stole with a pen).
At the other end, there’s Lady Gaga; Alex Rodriguez; Snooki. Whatever you think of them personally, they pleased millions and deserve their money.
In-between, there’s Mitt Romney, who made his money legitimately, while performing a valuable social service, but from a misaligned system.
What does private equity do, anyway? It finds and releases corporate value. Why is that value buried? Entrenched managers — protected by bad corporate governance (blame the hacks at SEC, and Delaware Chancery).
Private equity comes around when such entrenched bad managers create a big gap between stock price and true asset value at a firm. How do they do that? By running the company for their own personal benefit, not that of shareholders.
So some managers are like the proverbial dog in the manger. (For the untutored youth, the dog couldn’t eat the hay, but kept the cows away from it. Pointlessly selfish.)
Along comes Romney like a dog catcher; seizes the dog in a net and frees up the resources. A valuable social service, but one we need only because our market mechanisms are distorted. Fix the broken thermostat, and the creative Romneys will find other higher uses for their talents.
The problem is big intrusive government, perverted by crony special interests. You don’t blame the water for finding the hole in the bucket. Don’t blame free markets for finding the holes made by liberal distortions.