With due respect to somervilletom’s plea for positive posts … don’t miss this blockbuster in yesterday’s Washington Post that pretty much undercuts everything Mitt Romney has been saying for months, if not years, about his job creation record at Bain Capital.
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.
Why is this such a big deal? Here’s why:
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 fact that Bain was actively involved in businesses that were not just shipping their own jobs overseas, but whose entire business model was to help other companies do so – well, that speaks volumes.
So here’s the thing about Bain: it was never about creating jobs. Sometimes jobs were created, sometimes they were destroyed, and sometimes they were shipped overseas. It was always about exactly one thing: making money for Bain and its investors. That is not, in itself, a bad thing. But if Bain’s work did sometimes create American jobs, it was a happy accident, not by design. That doesn’t exactly qualify Romney to claim he knows how to create jobs.
Or, as Americablog put it,
Romney is claiming that this experience proves he’s a job creator. And in fact, we now know that he was a job creator.
In India and China.
Touché.
seascraper says
Would you rather talk to a human in India or a computer in the USA?
I’m not wild about such an economy but that is basically the choice. If you told Verizon they could only hire call center workers in the USA, you would never get anybody on the phone. They just wouldn’t hire the workers.
If you demanded that Verizon hire USA workers for jobs formerly outsourced, they would jack up the price of phones until most people could not buy them.
If you demand that Verizon sell phones for cheaper, they would stop selling phones. How is that good?
Let’s think these things through.
David says
OK. You say that if Verizon had to hire US workers, they wouldn’t be able to sell their phones in the US, thereby forcing them out of the most lucrative market in the world.
I say, balderdash. Verizon wants – needs – to sell its phones here, and they will find a way to do it. No way will they price themselves out of the US market. They are clever folks – they’ll find a way. They’re already working on it.
Personally, I find your lack of faith in the ingenuity of American business people to be disconcerting. 😉
kbusch says
In preparing for my series on Romney’s mendacity, one thing stands out. He repeats the same falsehoods quite regularly. Likewise, he shows excellent message discipline. His argument is something like this:
* The recovery has been slower than it should be.
* One reason: Obama’s bad policies (regulation, expanding the public sector, etc.)
* Another reason: Obama has no private sector experience so he has no idea how to create jobs.
* For me, Romney, creating jobs was my job.
There are a number of counters to this:
* If not for Republican opposition and obstructionism, the recovery would have been faster.
* The public sector has shrunk significantly over the past few years.
* In this economy, regulation can have two very good effects: It can prevent another financial meltdown. It can force companies sitting on cash to invest in technology to meet regulatory requirements.
* Growing national employment requires different expertise than growing a company.
* Romney’s job was outsourcing jobs, not creating them.
Those counters require steady repetition, too.
danfromwaltham says
Seems to me Obama always reminds us the mess GWB left him.
It is true, Obama has no private sector experience, so what is your response? He practiced it in theory at Harvard?
kbusch says
DFTT
danfromwaltham says
Baaaaaaa, baaaaaaaaa
danfromwaltham says
David- you just validated Pres. Clinton. What you are trying to say is Mitt Romney has first hand knowledge of foreign markets, basically their strengths and weaknesses, why jobs come and go etc. So if we elect him POTUS, he will know what to correct in order to attract more private sector jobs to the USA. He may be the most qualified candidate ever.
Another great read!
David says
He made some mistakes and signed some bad bills, but overall he did a good job in his two terms as president, including presiding over the best economy in decades. He wants Obama to win, and so do I.
Mitt Romney was very good at making money for himself and his buddies – nobody is disputing that, nor could they. Hardly a presidential qualification.
danfromwaltham says
I have hammered Clinton/Kennedy/Kerry supporting NAFTA and GATT and likely the only one here to mention it. That what you mean?
You must admit, what Obama/Axelrod did to Clinton in 20008, almost making out to be David Duke’s twin brother, was reprehensible. Clinton is a better man than I thought for even being on the same stage but that is another story.
Back to Mitt and his money. He didn’t make it gambling, or earning interest on dads trust fund, or marry it like Kerry. He did it the old fashion way, he earned it in the private sector, where budgets ate metro or you go out of business. If this election is about Mitt’s record in the private economy, he will win by 10 pts.
SomervilleTom says
If you think the private sector is better at meeting budgets than the public, then you haven’t spent much time in the private sector.
Meanwhile, a little economics 101: governments are not private business (or personal households). Mitt Romney is running for president, not CEO. Let me remind you that we are in a thread where the WAPO has demolished Mitt Romney’s claims of creating jobs.
President Obama’s record on the economy is stellar, especially in comparison with the failed proposals of both John McCain and Mitt Romney (see GM). Barack Obama rescued an economy DESTROYED by the same failed GOP dogma that Mitt Romney now promotes.
danfromwaltham says
Thanks for running to Dave and Bob about my posts being over the line. Are you the BMG hall monitor, trying to get me suspended? I wonder if calling someone naïveté is warrants a yellow or red card?
Consider this my last post to you and I hope vice-versa.
johnk says
just keep it reality based and I don’t think you’d have a problem.
SomervilleTom says
I’ll post where and when I choose.
danfromwaltham says
2008, not 20008.
“where budgets are met”
David says
😀
kbusch says
Governor Jindal recently lobbed this sharp accusation against our President. And perhaps business acumen is precisely what this country requires. After all there has been a recent business leader, worth $5.9 billion and the sixth richest man in his country. He had numerous election victories. He has been the longest serving Prime Minister. A clear model for today’s Republicans in his honesty and moral rectitude.
His name is Silvio Berlusconi.
(Originally posted here.)
merrimackguy says
and this post even stupider.
Who cares about this? No one who is an undecided vote.
Every company in the US that could has moved jobs overseas.
Are you going to blast every CEO?
Romney is just throwing a ton of stuff up there and some of it is sticking. Obama did it last time and it worked out okay, at least enough to get him elected.
kbusch says
No, we are not.
I hope that clears things up for you.
oceandreams says
As long as we’re talking about the value of private-sector experience in making government decisions. I’m in the private sector, have been my whole career, am a mid-level manager in my department and have been involved In hiring decisions from time to time.
If someone comes in for a job interview and tells us that his major qualification for the position is his experience creating jobs, then I’m going to be interested in details of that experience and I’d like to know he’s not lying about it, in addition to deciding whether the claimed skill set, character and strengths match what I need.