The Heartless Brain Center at Bain Capital

Wallace Whipple, 1964's Twilight Zone version of Mitt Romney, explains why automation is such a good idea—mainly the elimination of human beings, whose inefficiencies and costs are bad for profits. Thus they are fired and replaced by computer-controlled machines. And that is also the Bain Capital, Mitt Romney, way to success.
If you want to understand the brand of success Mitt Romney pursued at Bain Capital, and the brand he wants to inflict on the USA, all you have to do is watch an old Twilight Zone episode, number 153, entitled "The Brain Center at Whipple's", which aired in May, 1964 (another presidential election year).

Written by Rod Serling, the story opens with Wallace V. Whipple, the head of a manufacturing company, announcing to investors the wonderful benefits that everyone at Whipple Corporation will soon be experiencing from an automated workplace.
"And now to the stunning and exciting news that shows once again at Whipple's, we only take forward steps. And now family members and stockholders of the Whipple Corporation, this is the X109B14 Modified Transistorized Totally Automatic Assembly Machine, which eliminates:

• 61,000 jobs
• 73 bulky inefficient machines
• 81,000 needless man hours per eleven working days
• $4 million (1964 dollars) in cost savings—from eliminated employee hospitalization, employee insurance, employee welfare, and employee profit participation. 
Ladies and gentleman, from now on, Whipple will operate from a brain center with machines such as this one."
It isn't so much that Whipple or Mitt Romney are wrong in their view that capitalism just works a lot better if you get rid of the people, but it is the amazing cluelessness of both of them in thinking it's OK to promote that policy to the victims upon whom they intend to perpetrate it.

It takes a certain blind arrogance, and contempt for—in this case the voters—to boldly go to Bain Capital's record like it's an example of why working Americans should want to vote GOP.

Yet, that is precisely what Mitt Romney did today, writing in the Wall Street Journal, an upbeat account of Mitt's time at Bain, which makes "business experience" sound like a euphemism for social work. According to Mitt, everywhere he and Bain went, "investing" and making new companies, everybody just came out so much the better for it.

That such a view is deranged at best is clear from the bizarre rhetoric Romney uses to describe his success stories.

For example, here is Mitt's warm and fuzzy tale of Bain making a modern American steel plant:
Romney's story of Steel Dynamics: "In the 1990s, when the "old-technology" steel industry in the U.S. was failing, Bain Capital helped build a new steel company, Steel Dynamics, which has grown into one of the largest steel producers in America today, holding its own against Chinese producers. The key to its success? State-of-the-art new technology."
Sounds great, huh? Only problem is by "old-technology", Mitt means the kind that employed actual people to do jobs. The "new technology" is the kind that results in this now common situation, with a handful of lonely (or antisocial) workers running a vast robotic manufacturing plant. The automation certainly enabled Mitt and Bain to save a LOT of money, by getting rid of human beings. In fact, they were able to employ only about 10% of the workforce that had previously been required.

While the remaining human jobs paid well, they were machine and computer focused activities that produced situations like this one: 
"On busy days, Mr. Scott spends 12 hours straight in the four-by-five-foot crane compartment. He could take breaks, but he doesn't want to slow production to descend the 164 stairs to the floor, then to climb back up, so instead he heats his meals in a microwave inside the cab. He has even fashioned a makeshift bathroom. His only company is the radio abuzz with voices of co-workers far below telling him to where to move the crane."
As the article concludes: "Indeed, today's steelworkers work more closely with equipment than each other; it is harder for workers to forge the bonds that once characterized their group identity."

Maybe that is one of the reasons bonds of identity in the workplace have pretty much evaporated. And with those bonds goes the power of viewing one's work as a common experience. Another way Mitt Romney and Bain taught American business how to make more profits is to destroy labor unions. Preaching that unions cost jobs, Romney clearly intends the USA to return to its profitable 19th-century glory days when American workers were on a par with those in—oh—Bangladesh.

The gradual erosion of a sense of social wellbeing as a consequence of automating companies was an idea covered by Serling in the "Whipple" episode too. One fired employee, let go towards the end when almost no other humans are left in the giant manufacturing plant, explains why he isn't upset: "It's too darned lonely."

Mitt also tells us the exciting, Ayn Randian, tale of Accuride:
Romney's story of Accuride: "My business experience confirmed my belief in empowering people. For example, at Bain Capital we bought Accuride, a company that made truck rims and wheels, because we saw untapped potential there. We instituted performance bonuses for the management team, which had a dramatic impact. The managers made the plants more productive, and the company started growing, adding 300 jobs while Bain was involved. My faith in people, not government, is at the foundation of my plan to strengthen America's middle class."
Isn't that great? Jobs were added. The only problem is that the "dramatic impact" was achieved once again by firing bunches of people, replacing them with automation: "Accuride quickly invested in a new, highly automated plant to increase its capacity and reduce production costs."

"production costs" = human beings.

Mitt and Bain's gaming of a short-term opportunity at Accuride certainly paid off well for them. They got out of the investment in 18 months, scoring big profits.

And what happened to Accuride?

Well, in a few years, its Canadian plant was doing so poorly in a difficult economy, the Canadian government was paying the company huge subsidies to keep the plant from laying off its remaining workforce. Mitt's faith might be in people, not government, but the people's faith had better be in a socially conscious government, which will try to save their jobs rather than lay people off as Mitt Romney would certainly do.

As the Globe and Mail reported back in February of 1991:

"At Accuride Canada Inc., a London manufacturer of truck wheels, the federal government is subsidizing all but 20 of the plant's 560 workers one or two days a week. Factory manager Dave Gray said he would have been forced to lay off at least 150 workers without the program. More than 75 were laid off before the company began receiving assistance 11 weeks ago. "It's a big help in stabilizing the work force," Mr. Gray said, adding that recovering from the recession will depend on whether companies can maintain skilled labour."

Wow, that's an interesting idea, huh? Government investment during a recession to help companies KEEP employees so that the "skilled labour" pool doesn't shrink.

But, in Mitt Romney's Bain-style plan, the profitable operation of business makes replacing skilled labor with machines the proper course. Yet somehow, that is supposed to "strengthen" the middle class—perhaps by impoverishing it to the point of people having to chop wood to burn for cooking and heating.

By the way, the Canadian government has lately abandoned its more socially responsible attitude toward "skilled labour" and now does business the Bain way. This is a recent Globe and Mail story about what happened at Accuride after the 2008 economic crisis:

"In nearby London, Accuride Canada now has about 100 people making steel wheels, down from 450, said Jim Reid, vice-president of local 27 of the Canadian Auto Workers union."

That same 2010 article makes the point that American government subsidies to Detroit-area automobile makers had not only saved the industry, but had begun recovering lost manufacturing jobs.

The fact is, Mitt Romney, who infamously advised that Detroit's auto industry should just go bankrupt, is just dead wrong about the proper role that government can play in aiding an ailing economy. Stimulus works, to save businesses and jobs.

Mitt Romney's great plan for America is so antagonistic to the future wellbeing of most Americans, that it is amazing Mitt is still viewed with great skepticism by people in his own political party who think he isn't a "true conservative", in other words that he isn't an obviously crazed meathead like Todd Akin.

Maybe Mitt isn't that looney or that brand of looney. But he's something far worse—a rich guy who doesn't mind lying to working people in order to make Mitt's feeding off their labor and misfortune seem like a kindly favor he did, and intends to do, to them.

Comments