Is Mitt Romney really a job creator? What his Bain Capital record shows.
Mitt Romney is running for president on his business acumen, saying he knows what it takes to create jobs. He puts less emphasis on what he knows about eliminating jobs. Marion, Ind., has experienced both via Romney and Bain Capital.
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Before Mitt Romney’s Bain Capital bought the rambling SCM factory in Marion, Ind., it was running three shifts a day, making hanging file folders and other office supplies. But on July 5, 1994, everything changed.Skip to next paragraph
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The new owner, American Pad & Paper, owned in turn by Bain Capital, told all 258 union workers they were fired, in a cost-cutting move. Security guards hustled them out of the building. They would be able to reapply for their jobs, at lesser wages and benefits, but not all would be rehired.
“We were told they bought the assets, not the union or the [labor] contract,” recalls Randy Johnson, who at the time worked as a machine operator and was a union shop steward. The workers – some the third generation in their families to have jobs there – eventually went on strike, and Bain closed the factory 5-1/2 months after acquiring it.
Not far from the former plant is a Staples office supply company – the typical store employs 20 to 30 people – and a Domino’s Pizza franchise, which typically has about 15 workers. Both outlets can point to contributions from Bain Capital, which provided seed money for the parent company to grow, eventually adding thousands of jobs across the US.
Bain Capital’s activities while Mr. Romney ran it from its founding in 1984 until he left in 1999 are being scrutinized now that he is front-runner in the Republican presidential race. Romney says that he knows business and that his work at Boston-based Bain led to the creation of 100,000 jobs. His business record and management prowess could be deciding factors if he’s the GOP nominee, because credibility on the issue of jobs is likely to determine who resides at 1600 Pennsylvania Avenue next January.
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“When we ask people what worries them most, jobs is the most important, the top issue,” says Frank Newport, editor-in-chief of the Gallup Poll. In its November poll, Gallup found that only 30 percent of the public approved of the way Mr. Obama is handling the economy.
But Romney’s GOP rivals are endeavoring to take the polish off his job-creation credentials. Texas Gov. Rick Perry, who dropped out of the GOP contest Jan. 19, had referred to Romney’s record at Bain Capital as “vulture capitalism.” And leading up to the South Carolina primary, a group backing Newt Gingrich for president let loose with a 28-minute TV ad (containing inaccuracies and unsubstantiated claims, including about the AmPad episode) that sought to portray Romney and Bain Capital as ruthless job-killers. The Obama campaign would likewise be expected to assail Romney’s jobs record.