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Private-Equity Exec Luke Johnson: Romney's Candidacy 'Lacks All Credibility'

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Risk Capital Partners chair Luke Johnson writes that in private equity,
Risk Capital Partners chair Luke Johnson writes that in private equity, "[a]ttention is not directed towards the common wealth, but enriching the management."

Just because Mitt Romney ran a private equity firm doesn't mean he's qualified to be president. That's what guys like Vice President Joe Biden and Los Angeles Mayor Antonio Villaraigosa have said.

And fine, you'd expect that since they're politicians and Democrats. But it's a little more significant when a fellow private equity man says the same thing.

In a column for the Financial Times this Tuesday, Luke Johnson, chairman of the private equity firm Risk Capital Partners, rips the idea that Romney's experience as the head of Bain Capital might have done anything to prepare him for public service.

You really ought to read the whole thing, but here are a few choice bits: Johnson argues that private equity firms are "run to maximise profits for the owners, rather than for the creation of jobs"; that people who succeed in the industry "need to be ferociously interested in accumulating money"; and that generally speaking, private companies "are not democracies -- they are quasi-dictatorships."

And then the clincher: "I'm no fan of Barack Obama but to me, Mr Romney's candidacy simply lacks all credibility."

Now, we already know that Mitt Romney is a rich man -- worth more than the last eight presidents, Nixon through Obama, combined. And we know he's a believer in "creative destruction," the business concept that essentially means corporate success can entail a lot of people losing their jobs.

As for Bain Capital, that company has definitely caused some layoff-related distress in its time. The firm's has come under fire for acquiring companies and restructuring them in a way that makes them more profitable. Bain has been known to make recommendations that leave hundreds of U.S. employees jobless while moving those jobs overseas.

Romney, for his part, has pointed to the success of Bain itself as evidence that he would be able to guide the languishing economy onto a better path. Along the way, he's argued Bain Capital created "thousands of jobs" during his time there, a revision of an earlier statement that claimed a number closer to 100,000.

Related on HuffPost:

Companies Bain Helped Build, Run Or Bust
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Around the Web

Taking a Whack at Romney's Private Equity Past - Businessweek

Mitt Romney's Private Equity Nightmare - Businessweek

Tall Tales About Private Equity - The New York Times

Where Is Romney's Private Equity Pride?

Venture capitalists say Romney is not one of us

 
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