Mitt Romney’s candidacy for presidency has provided Americans with an illuminating narrative on an all-too-real element of our capitalist economy: “creative destruction.”
Here’s a great article we read on the Wall Street Journal that is the basis for this commentary.
As a partner with Bain Capital, Romney’s job was to, in essence, destroy companies to help save them. One tactic would be to trim the workforce and implement other cost-saving measures to turn the company’s financial prospects around. And in many instances, Romney and his cohorts were extremely successful.
But there is a catch. On the surface, the idea of turning a company around is the job of any traditional consulting firm. However, Bain differed from this conventional approach in one glaring way: Romney invested in the failing companies and, over time, reaped financial rewards when the stock price rebounds.
Now we won’t get into the political or ethical implications of Bain Capital except to say such practices are allowed and even encouraged in our economic system. However, we at Cohesian believe that there are other ways to create jobs and support small businesses. Its called “conscious capitalism” and we believe one does not need to destroy something to make it better. Conscious capitalism is here to stay and we’re looking forward to doing our part to make a difference!