Mitt Romney's investments aren't the only ones voters should be worried about as he runs for an office he must surely think of as Investor in Chief. Lee Fang
digs into Solamere, the "fund of funds" that Tagg Romney started with
$10 million of his parents' money and in partnership with Spencer Zwick, Mitt's top fundraiser and "sixth son," and finds that even beyond the obvious stuff like Wall Street regulation and tax rates on the wealthy, Mitt, his family, and their good friends and business partners have financial interests that could affect policy to the detriment of working Americans. The connections between Solamere and Mitt's campaign are so close, in fact, that Solamere has held investor conferences in conjunction with Romney campaign fundraising retreats.
One of the funds in Solamere's network is Sun Capital Partners, founded by sex party and Romney fundraiser host Marc Leder. Sun Capital owns a piece of the Scooter Store, which advertises free Medicare scooters. One potential problem for the Scooter Store's profitability, and therefore for the future of Sun Capital's investment: government oversight on whether all those people actually need scooters, and whether Medicare is being accurately billed. This is a business that could be seriously threatened if, say, people had to actually meet with a doctor to determine if they actually needed a scooter such that Medicare should pay for it, or if there was a competitive bidding process. There's a government pilot program for the former, and the latter is in Obamacare—so the question is, would Romney continue those moves to cut down on waste and fraudulent billing in Medicare even though his donor and business associate would take a hit?
Then there are for-profit colleges. Romney is such a fan of for-profit anything that he of course thinks for-profit colleges are fantastic, even in the face of their low graduation rates, high debt rates, utter reliance on federal government loans, and questionable, even fraudulent, recruiting practices. And when Romney's looking to single out a for-profit college, what's his answer? Fang reports:
Asked about the rising cost of colleges at a town hall event in New Hampshire in December 2011, Romney said that students should take a look at for-profit colleges like Full Sail University, a career college for the entertainment and production industry. Weeks later, in an interview with the Ames Tribune, Romney hailed the “advent of for-profit institutions of higher learning” for providing competition with public and private universities. He again volunteered Full Sail University as a good example of how students can “hold down the cost of their education.”
What Romney neglected to mention is that Full Sail University—in fact the third most expensive college in the United States—is owned by [Solamere-linked] TA Associates. Indeed, TA Associates has viewed the for-profit college industry—a $40 billion market where 85 percent of the funds are supplied by taxpayers—as an excellent opportunity for growth. The firm has invested in other for-profit colleges, including the Rocky Mountain School of Design, the Los Angeles Film School and Vatterott Educational Centers Inc. Like most profit-driven colleges, which account for only 10 percent of all students but about half of all loan defaults, TA Associates’ schools do not boast a stellar track record. Leaked documents for Vatterott show that recruiters were instructed to use “pain” when targeting students—who, the recruiters are told, decide on college “based more on emotion than logic.” Within three years of dropping out or graduating, 26.6 percent of Vatterott students default on their loans.
Barack Obama's been working to crack down on for-profit college abuses. What's the likelihood that crackdown would continue under President Romney? And Fang details several other areas where Solamere's partner firms stand to lose out if the government cuts waste and challenges fraudulent billing.
To be sure, some of these—maybe most—are areas where Romney would like the government to be as big and wasteful as possible, to inflate private profit just on principle. But the fact that his son and his top fundraiser and, through them, Mitt himself, have both a serious financial stake and close relationships with Medicare and Medicaid overbilling and for-profit colleges, is one more red flag about how Romney's much-touted business experience would translate into the presidency.