Why is Mitt Romney's time at Bain Capital such a target?
Press reports this week detailed jobs sent abroad and executive profits made when firms failed during Mitt Romney's time running Bain Capital. Are such charges fair, and will they stick?
Mitt Romney’s record running the Bain Capital investment firm continues to get close and sharp-edged scrutiny, giving the Obama campaign ammunition as it tries to defend its own record during rough economic times.
Specifically, critics say that Bain during the years of Romney’s leadership had a direct hand in sending US jobs abroad. A long piece in the Washington Post this week details such activity when Romney ran the firm.
“During the nearly 15 years that Romney was actively involved in running Bain, a private equity firm that he founded, it owned companies that were pioneers in the practice of shipping work from the United States to overseas call centers and factories making computer components, according to filings with the Securities and Exchange Commission,” the Post reported. “While Bain was not the largest player in the outsourcing field, the private equity firm was involved early on, at a time when the departure of jobs from the United States was beginning to accelerate and new companies were emerging as handmaidens to this outflow of employment.”
The Romney camp fired back that the Post story was “fundamentally flawed” because it didn’t differentiate between “domestic outsourcing versus offshoring nor versus work done overseas to support US exports” – a distinction hard to explain in a soundbite or on Twitter.
But it was clearly on the defensive as political opponents piled on.
“This simply doesn’t change the fact that Bain, under Romney, invested in companies whose sole purpose was to move jobs to other countries, directly countering the narrative that Romney has been trying to set,” declared the Think Progress liberal blog.
Within hours, the Obama campaign picked up on the story.
“Today it was reported in The Washington Post that the companies [Gov. Romney’s] firm owned were ‘pioneers’ in the outsourcing of American jobs to places like China and India,” Obama said during a speech in Tampa, Fla. “Pioneers!”
The campaign quickly launched an online map showing the 14 countries where Romney’s company had opened call centers and plants or provided manufacturing services.
A key paragraph:
“The private equity firm, co-founded and run by Mitt Romney, held a majority stake in more than 40 United States-based companies from its inception in 1984 to early 1999, when Mr. Romney left Bain to lead the Salt Lake City Olympics. Of those companies, at least seven eventually filed for bankruptcy while Bain remained involved, or shortly afterward, according to a review by The New York Times. In some instances, hundreds of employees lost their jobs. In most of those cases, however, records and interviews suggest that Bain and its executives still found a way to make money.”
The New York Times published this response from Bain Capital:
“We understand that in a political campaign some may distort or our investment activity by cherry picking a few negative situations while ignoring our overall track record. But, the truth is that less than 5 percent of our companies filed for bankruptcy while under our control, a figure consistent with the broader economy, and revenues have grown in 80 percent of the more than 350 companies in which we have invested.”
Will any of this make any difference?
“Republicans argue publicly that the attacks have failed to move the needle in polling, so why engage, and that voters are more concerned about their own lives,” writes Maggie Haberman at Politico.com. “But privately, some Republicans believe and/or fear there will be an aggregate effect in key states among middle class voters from the Bain assault.”
As they try to frame an answer for dismal jobs and unemployment figures, that’s what the Obama camp is hoping for.
The pro-Obama Priorities USA Action superpac has launched a series of TV ads featuring employees of companies it says were shut down by Bain.
You can expect more such political thrust and parry as the presidential campaign continues.