The primary point in looking back at Mitt Romney’s career at Bain Capital is that his experience at Bain gave him no expertise regarding creating jobs or improving the economy as president. As Romney is avoiding talk of his brief career in government, it is inevitable that he will face further scrutiny regarding his years at Bain. Yesterday, The Washington Post (contradicting an earlier Post story critical of an Obama campaign ad) reported on how Bain Capital invested in companies exporting jobs overseas:
Mitt Romney’s financial company, Bain Capital, invested in a series of firms that specialized in relocating jobs done by American workers to new facilities in low-wage countries like China and India.
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.
It didn’t take long after this for Obama to call Romney an “outsourcing pioneer.”
Further in The Washington Post’s report:
For years, Romney’s political opponents have tried to tie him to the practice of outsourcing American jobs. These political attacks have often focused on Bain’s involvement in specific business deals that resulted in job losses.
But a Washington Post examination of securities filings shows the extent of Bain’s investment in firms that specialized in helping other companies move or expand operations overseas. 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.
Bain played several roles in helping these outsourcing companies, such as investing venture capital so they could grow and providing management and strategic business advice as they navigated this rapidly developing field.
The New York Times has a report today which will add to the view of Romney as a vulture capitalist, not a creator of wealth:
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.
Mr. Romney’s experience at Bain is at the heart of his case for the presidency. He has repeatedly promoted his years working in the “real economy,” arguing that his success turning around troubled companies and helping to start new ones, producing jobs in the process, has prepared him to revive the country’s economy. He has fended off attacks about job losses at companies Bain owned, saying, “Sometimes investments don’t work and you’re not successful.” But an examination of what happened when companies Bain controlled wound up in bankruptcy highlights just how different Bain and other private equity firms are from typical denizens of the real economy, from mom-and-pop stores to bootstrapping entrepreneurial ventures.
Bain structured deals so that it was difficult for the firm and its executives to ever really lose, even if practically everyone else involved with the company that Bain owned did, including its employees, creditors and even, at times, investors in Bain’s funds.
The Romney campaign’s prospects come down to convincing middle class individuals to vote for Romney despite the fact that Romney’s economic plans will increase their taxes and increase the deficit, returning to the policies of George Bush which caused the current recession. This comes down to voters developing a warm, fuzzy feeling about Mittens and closing their minds to the facts. Romney’s history at Bain, however, leaves him open to criticism which might erode his support among middle class voters who currently are contemplating voting for Romney, counter to their interests and the interests of the nation. The latest example can be seen in this new ad from PrioritiesUSA: