Mitt Romney Reaps Windfall Profit from Delphi Deal

Mitt Romney Made $15 Million Off Taxpayer Investment in Auto Industry Despite Being Opposed to Auto Bailout

 Mitt Romney infamously and vehemently opposed the auto industry bailout, but "The Nation" reports that he and his wife Ann Romney made $15.3 million off of the taxpayer dollars that were used to save the auto industry. Furthermore, Romney's investment helped to ship former Delphi Automotive jobs to China.

Many of Romney's campaign contributors were also able to cash in on the auto industry bailout, and a few of his most prominent Wall Street donors made more than $4 billion.  The Bush administration made loans to save the auto industry, which was on the brink of collapse, in late 2008. After Barack Obama took office, even more loans and investments were made to Chrysler and General Motors to keep them from going out of business. At that time, Mitt Romney penned an editorial in which he decreed "let Detroit go bankrupt."  Delphi Automotive, which was formerly the Delco Division of General Motors, makes parts for GM's production lines. A bailout of GM or Chrysler would not have been successful if Delphi were also not saved. So the federal government also sent more than $12.9 billion to Delphi, which at that time was controlled by Wall Street hedge funds.  One of the hedge funds that profited handsomely from the Delphi bailout was Elliot Management, which was directed by Paul Singer. Singer has given $2.3 million to support GOP candidates, more than anyone else on Wall Street this election. His colleagues have thrown in another $1.1 million, bringing their collective donation to help elect Republicans up to $3.4 million.  Singer has significant influence with Romney, for whom he serves as an informal adviser. Singer was also instrumental in helping to get Rep. Paul Ryan on the GOP ticket.  Meanwhile, Ann Romney's blind trust also invested at least $1 million into Elliott before the fund began to buy Delphi for about 20 cents on the dollar. Elliott eventually took over Delphi at 67 cents a share. A mere two years later, shares of Delphi were trading at $22 each. Think about the profits they made with that deal - it's astounding.  Today, only four of the 22 Delphi plants that operated in the United States when Elliott began buying up control of the company actually remain. None of then employ even a single union production worker. Delphi now mostly makes most the parts used by GM and other automakers in China. Delphi employs just 5,000 in the U.S., but 100,000 overseas.  According to calculations by the U.S. Treasury and GM, without the billions in taxpayer money and slashing worker pensions, the hedge funds' investment in Delphi wouldn't have panned out and wouldn't have been worth even a single dollar.  Romney now tours the country attacking Obama for "using the Stimulus" to "ship jobs to China", when he was directly involved in the loss of jobs to China himself and profited off the investment of taxpayers into the auto industry bailout that he opposed. That is the definition of hypocritical.  In other auto bailout news, the Obama campaign released an advertisement in Ohio highlighting what the rescue meant to Buckeye state workers.

"I Love the smell of freshly minted pink slips in the morning" -Mitt

We now know, thanks to Greg Palast’s recent scoop in The Nation, that Mitt Romney reaped a large financial windfall from the auto bailouts. Romney didn’t talk up this shrewd investment while touting his business experience on the campaign trail, for obvious reasons—he is a strong critic of those bailouts.

But while Romney had ample political reasons to conceal his investment, he apparently had no legal justification for doing so. Federal law requires that candidates disclose stock holdings that are affected by government action—and Romney’s million-dollar (at least) investment in a hedge fund that bought up Delphi stocks surely fits that bill.  Now, unions and good-government groups are calling on the feds to investigate Romney’s oversight.  Thursday afternoon in Toledo, Ohio—where the story has received significant play in local media—United Auto Workers president Bob King joined Palast and Service Employees International Union vice president Tom Woodruff to call upon the US Office of Government Ethics to look into Romney’s financial disclosures and their failure to list the Delphi investments. Along with several groups like CREW and Public Citizen, the union leaders also sent a letter to OGE demanding a formal investigation.

“The American people have a right to know about Governor Romney's potential conflicts of interest, such as the profits his family made from the auto rescue,” said King. “It’s time for Governor Romney to disclose or divest.”  As Palast reported, a trust in Ann Romney’s name listed “more than $1 million” invested with Elliott Management, run by hedge fund guru and GOP mega-donor Paul Singer. (That’s the minimum amount of disclosure required by law, so it could have been much more than $1 million.) Singer subsequently snapped up large amounts of stock in Delphi at pennies on the dollar, and then, along with other hedge funds, demanded that the government assume pension responsibilities and bail the company out—or they would shut it down, thus crushing General Motors as well.  The government acceded, Delphi became lucrative again and then went public, and Elliott Management and its investors—including Romney—reaped enormous rewards. Under any rational interpretation of the Ethics in Government Act of 1978, these are holdings that a presidential candidate would need to disclose, because they can be affected by government action. The Romney campaign doesn’t argue that they are not, but rather that, since Ann Romney’s trust is “blind,” there is no disclosure requirement.  Today’s letter points out, however, that Ann Romney’s trust is blind in name only. Romney himself has said that “the blind trust is an age-old ruse, if you will. Which is to say you can always tell a blind trust what it can and cannot do.” Moreover, this is not a federally recognized blind trust of the sort Romney would be forced to create if he won the White House. If it was, he would have never been able to reap his windfall from Delphi, the letter points out. Whether or not Romney broke the law will come down to this question of how blind this trust really is, and Romney at least has some plausible deniability there. But no doubt this is a story his campaign doesn’t want to see playing out in Ohio five days before the election.

This story is completely fantastic.  If ever there was a coveted “smoking gun” for Democrats, this is it.  I’m downloading a copy of this article to Word so I can continue to refer to it.

 
New York City is canceling their Marathon that had been scheduled for tomorrow.  I think cancelation is an excellent idea.  It's one idea Rush Limbaugh had that actually makes sense.  He said it was silly to bring in generators that could be used to power homes" to Central Park as part of the Marathon.  People who were dispossed and homeless were being kicked out of local Hotels to make room for the Marathon runners.  Also the weather is turning colder and snow is predicted.  Rush Limbaugh's rationalle for even having the Marathon seems silly.  He said it had to do with "global warming" and the "all natural" and "healthy human specimine" not vunerable to commercial sell-out or something.  In another area Google just informed me that my background picture will be yanked in a couple of weeks.  They are calling it an "improvement" just as eliminating "Desktop search" was a so called "improvement".