This editorial appeared in the Oct. 30 Providence Journal:

In 2008, Mitt Romney’s son Tagg co-founded an investment company named Solamere Capital — a “fund of funds” that invests in private-equity companies. Tagg was helped by at least $10 million in seed money from his parents. The other co-founding partners are Spencer Zwick, a campaign fund-raiser for Mitt Romney, and Eric Scheuermann, with a private-equity background.

But it’s more complex than that – there’s a labyrinth of overlapping investments involving the Romney family and their friends and allies. Mitt Romney, of course, is Bain Capital’s founding chief executive. Below the surface are troubling possibilities for selling access to, and favors from, the man who may well be our next president. Solamere touts its “access to compelling opportunities.” Indeed. Solamere held an investor conference in Salt Lake City last June just as rich Romney donors were at a fundraising retreat in the building next door. Mitt Romney vows that if elected, he will put his investments in a federally qualified blind trust and would sell off other assets “not fully compliant with federal disclosure and other rules applicable to the office of the presidency.” But that would not be the case with Tagg’s Solamere: It would not have to offer that level of disclosure. As reported in The Boston Globe and The Nation magazine, Solamere’s partners own scores of companies that live or die by government contracts and favorable regulations. Just having an inside track on what’s being talked about in the various federal bureaucracies is worth millions of dollars a year. One Solamere investor is Sun Capital, whose Scooter Stores are seen on television advertising motorized wheelchairs paid for by Medicare. A Centers for Medicare and Medicaid Services report found that 80 percent of the Scooter Stores’ sales did not meet Medicare rules, at a waste to taxpayers of nearly half a billion dollars. Marc Leder, the principal of Sun Capital, has given a total of $525,000 to Mitt Romney’s presidential campaign. And the Scooter Store has spent nearly $900,000 on lobbyists trying to stop Medicare from disqualifying its wares for taxpayer subsidies. On the campaign trail, former Governor Romney has talked up for-profit colleges, particularly one (Full Sail University) owned by TA Associates, another Solamere investor. These colleges are known for providing questionable education at high cost. Some 85 percent of their revenues come from the federal government. Fracking and other energy interests have their money with Solamere. So have investors with holdings in health-care companies and military contractors. Private-equity executives have long lobbied to keep their huge tax loophole — taxing what are effectively partners’ salaries at the low 15 percent capital-gains rate. Himself having helped create a private-equity fortune, Mitt Romney has shown no inclination to touch that particular loophole. And Solamere has followed in Bain Capital’s footsteps setting up shop in the Cayman Islands to shield its investors from tax liabilities that ordinary companies and individuals face. Don’t hold your breath waiting for tax reform on that. Adam Smith, a spokesman for Public Campaign, a reform group that reports on money in politics, called the Mitt-Tagg team “absolutely a conflict of interest.” As he told The Nation, Solamere investors, “many of whom are likely Romney campaign donors, will have extra access and influence in a Romney administration.” That Solamere is openly marketing the Mitt Romney connection is deeply troubling. Solamere’s creation is also yet another example of how America’s financial-sector plutocracy perpetuates itself. http://blogs.providencejournal.com/ri-talks/this-new-england/2012/10/taggs-terrific-team-of-crony-capitalists.html

Imperium Watch: The Solamere Money Machine

It counts your votes—and enriches the Romneys.

By Stephanie Kraft

Valley Advocate, November 01, 2012