Sunday, January 15, 2012

Three cheers for carrion-eaters

Mitt Romney's success in the GOP primary has lead to some harsh criticism from rivals Rick Perry and Newt Gingrich, comparing Romney's old private equity firm Bain Capital to a vulture that feasts on the dead and leaves only bones behind.

Some people are saying that comparison isn't a fair description of Bain Capital's actions. But for this post, let's assume it was true. Let's say there are firms that break up troubled companies and harvest the assets, laying people off in large numbers. Is there ever an ethical time to do that?

Yes there is, as that's a public service that the economy needs. I could go into details of why that is, but there's already a great monologue from Danny DeVito that explains it all.

Can you imagine a world without vultures? An Earth without carrion beetles, blowflies or decompositing bacteria? Dead bodies would pile up and waste space. Their useless carcasses would tie up matter out of circulation in the circle of life. It's unpleasant to watch, but rot and scavenging are a necessary part of the ecosystem.

The same is true for businesses. Without vulture firms, we would have unneeded, wasteful or incompetent firms occupying office space, holding onto workers and wasting customer money. When those firms are eaten or rot, all those resource go back into circulation.

Healthy, fit animals have nothing to fear from the noble vulture. They are the avian custodians of our world.


  1. It's just... It's... (sob)... So beautiful...

  2. It's easy for people to get emotional over the laying off of workers, but I think the charges against Romney that are more significant is the one describing how he and the other executives pocketed pretty hefty bonuses that were financed by the banks, leveraged against the companies they bought.

  3. I don't get the whole bonus thing. These people, right or wrong, have/had contracts that specify how much they get paid and how large a bonus they will receive given a set of circumstances.

    If I hired you to manage my business and it failed under your tenure, you would still expect me to abide by the terms of our contract, would you not?

    As long as you were meeting all the criteria we contracted on, you could sue me and win handily.

  4. Vulture is just not a good analogy: Vultures are known to attack living, weakened animals without consent. (I assume) none of Bain's contracts were signed under coercion, so their employees rightly earned their pay.

    The real scandal is the CG tax rate, but that's a matter of opinion :) If Romney were smart he'd own it: "I concede I'm more successful at capitalism than my rivals. If you want politicians who don't understand the free market as well, they are available."