Romney Camp Admits That Its Bain Job Creation Number Is Bogus
Mitt Romney, last night’s Iowa caucus winner, has been on the campaign trail claiming that the private equity firm he ran, known as Bain Capital, was responsible for creating loads of jobs. Romney responded to criticism about his time at Bain by saying, “I’m very happy in my former life; we helped create over 100,000 new jobs.”
When a group of Romney backers ran an ad making the same claim, they were unable to back up the number with data. And as it turns out, the Romney camp can’t either, as it admitted that the statistic is nothing but cherry-picked job growth from a few companies that did well after they were bought by Bain:
[Romney spokesman Eric] Fehrnstrom says the 100,000 figure stems from the growth in jobs from three companies that Romney helped to start or grow while at Bain Capital: Staples (a gain of 89,000 jobs), The Sports Authority (15,000 jobs), and Domino’s (7,900 jobs).
This tally obviously does not include job losses from other companies with which Bain Capital was involved — and are based on current employment figures, not the period when Romney worked at Bain. (Indeed, Romney made his comments in response to a former employee of American Pad & Paper Co. who says he lost his job after Bain Capital took it private.)
Bain Capital has been responsible for thousands of layoffs at companies it bankrupted, such as American Pad & Paper, Dade International, and LIVE Entertainment, which Romney’s stat completely leaves out. He’s also taking credit for jobs created long after he left the firm to launch his political career. To sum it up, the stat Romney uses is incredibly dishonest, like much of his jobs rhetoric.
One of Romney’s Bain business partners has said that he “never thought of what I do for a living as job creation.” “The primary goal of private equity is to create wealth for your investors,” he added. And Bain has certainly done that, maximizing earnings “by firing workers, seeking government subsidies, and flipping companies quickly for large profits.” Due to a lucrative retirement deal, Romney is still making millions from Bain, as he goes across the country calling himself “middle class” and joking about being “unemployed.”
By: Pat Garofalo, Think Progress, January 4, 2012
Mitt Romney Takes His China-Bashing Campaign To Company That Touts Its Chinese Outsourcing
Well, this is awkward. Mitt Romney, who’s been on the trail recently talking tough on China, is making his last campaign stop of the day before the caucuses at a business that touts the way it outsources much of its manufacturing to China.
Competitive Edge is a firm headquartered near Des Moines that creates and sells promotional items with corporate logos. Romney’s scheduled to make a campaign stop there at around 9:00 PM CT, as part of a day-long tour through the Hawkeye State in the run-up to Tuesday’s caucuses.
What he may not mention: customers of Competitive Edge are choosing a company to make their promotional goods that brags about how much manufacturing work it sends to China.
From the company’s website:
We achieve this goal by utilizing a global network of manufacturers that assist us in sourcing, designing and making our products. It is not surprising that most labor-intensive products are produced in China. What may not be as well known is the level of sophistication and technical expertise that Chinese manufacturers have developed. Competitive Edge takes advantage of these foreign assets and has been working with Chinese manufacturers for over 25 years. As a result of our years of experience and our extensive factory and agent relationships in China, we are able to bring great value and a high level of service to our customer.
The website also features pictures of Chinese employees hard at work on what looks to be Competitive Edge orders. They’re really quite good at sending work to China, the website says:
Our extensive use of cutting edge technology makes it easy for us to collaborate and compete in real time with people and companies located anywhere in the world. Utilizing computer networking, e-mail, teleconferencing and dynamic software applications, conducting business in China is as easy for us as working with domestic companies.
At the Clive location, where Romney will be speaking, the company houses its “Screen Printing and Embroidery Departments.”
On the trail, Romney has said he’d take China before the WTO to be penalized for currency manipulation. Rival Jon Huntsman has warned against that, saying it would start a trade war that would boost prices on Chinese goods and, presumably, making life a lot harder for companies like Competitive Edge.
By: Evan McMorris-Santoro, Talking Points Memo, January 2, 2012
Mitt Romney’s Limited Understanding Of “Jobs”
Mitt Romney seems to think his strongest issue in a general-election race against President Obama is jobs. I’d argue he has that backwards.
In an interview with TIME Magazine’s Mark Halperin, Romney said, “I know that the Democrats will try and make this a campaign about Bain Capital…. 25 million people are out of work because of Barack Obama. And so I’ll compare my experience in the private sector where, net-net, we created over 100,000 jobs.”
“I’ll compare that record with his record, where he has not created any new jobs.”
This detachment from reality fascinates me, so let’s unwrap the argument.
First, the confused former governor believes 25 million people are out of work “because of Barack Obama.” If Romney can explain why Obama is to blame for a recession that began in 2007, I’d love to hear it. For that matter, the economy lost 3.6 million jobs in 2008 — the year before the president took office. How exactly is Obama responsible for that, too?
Second, Romney now claims to have created “over 100,000 jobs” at his vulture-capitalist firm. Romney also appears to have made this number up out of whole cloth. Indeed, two weeks ago, when Romney’s Super PAC ran an ad claiming he “helped create thousands of jobs” as CEO at Bain, Super PAC officials were asked to back that up with evidence. They refused.
Third, it’s remarkable that Romney is only willing to compare his “experience in the private sector.” What about when Romney was willing to put his experience to work in the public sector, during his one term as governor of Massachusetts? Romney doesn’t want to talk about it for a reason — his state’s record on job creation was “one of the worst in the country,” ranking 47th out of 50 states in job growth. It’s one of the reasons Romney left office after one term deeply unpopular, and why his former constituents don’t want him near the White House.
And fourth, Obama “has not created any new jobs”? The ease with which Romney lies continues to be disconcerting.
With one month remaining this year, the U.S. private sector has now added 1.67 million jobs in 2011, well ahead of last year’s private-sector total of 1.2 million, and the best year for businesses since 2006. Since March 2010, American businesses have created 2.9 million jobs.
I’d encourage Romney to consider this chart showing private-sector job growth by month since the Great Recession began…
…and this chart showing private-sector job growth by year over the last two decades (and 2011 isn’t over yet).
Reporters really need to brush up on this stuff. When Romney lies to their face — which seems to happen just about every day — they should be able to push back with reality.
By: Steve Benen, Contributing Writer, Washington Monthly Political Animal, December 23, 2011
Mitt Romney Still Making Millions From Lucrative Bain Capital Retirement Deal, Pays Little Taxes
2012 GOP presidential hopeful Mitt Romney has been banking on his time running the private equity firm Bain Capital to be a major selling point for his campaign. “I spent my career in the private sector. I think that’s what the country needs right now,” Romney says.
Romney has had to contend with the fact that Bain made a lot of its money buying up companies, then laying off workers and reneging on benefits to gut those companies, burying them with debt as Bain walked away with millions. In fact, one of his former business partners has explicitly said, “I never thought of what I did for a living as job creation.” And as it turns out, even after Romney left the firm, he was profiting from Bain’s activities due to a lucrative retirement deal:
In what would be the final deal of his private equity career, he negotiated a retirement agreement with his former partners that has paid him a share of Bain’s profits ever since, bringing the Romney family millions of dollars in income each year and bolstering the fortune that has helped finance Mr. Romney’s political aspirations.
The arrangement allowed Mr. Romney to pursue his career in public life while enjoying much of the financial upside of being a Bain partner as the company grew into a global investing behemoth.
Since Romney left, Bain has made its money gutting companies like KB Toys and Clearchannel, laying off thousands of workers and leaving the companies under heavy debt loads, while Romney has reaped the benefit. Adding insult to injury, the money Romney has been collecting from Bain is likely not taxed as normal income but as “carried interest,” meaning it is subject to the capital gains tax rate of 15 percent rather than the top income tax rate of 35 percent:
[S]ince Mr. Romney’s payouts from Bain have come partly from the firm’s share of profits on its customers’ investments, that income probably qualifies for the 15 percent tax rate reserved for capital gains, rather than the 35 percent that wealthy taxpayers pay on ordinary income. The Internal Revenue Service allows investment managers to pay the lower rate on the share of profits, known in the industry as “carried interest,” that they receive for running funds for investors.
Because Romney’s income is almost exclusively derived from what are qualified as investments (he recently said he has no income that qualifies for the personal income tax), he is able to drive his tax rate to absurdly low levels for someone making as much as he does. Citizens for Tax Justice estimated that Romney pays about a 14 percent tax rate, below the level at which many middle-class families are paying. And he’s paying that low rate on money made via dismantling companies and eliminating jobs.
By: Pat Garofalo, Think Progress, December 19, 2011
If Only GOP Lawmakers Were More Like GOP Voters
I imagine everyone has seen the bumper sticker that says, “Lord, protect us from your followers.” I have an idea for a related sticker that reads, “Republicans, protect us from your elected officials.”
In the existing political landscape, the real problem is not with GOP voters; it’s with GOP policymakers. This isn’t to let the party’s supporters off the hook entirely — they’re the ones who supported and elected the officeholders — but it’s hard to overstate how much more constructive the political process would be if Republican lawmakers in any way reflected the priorities of their own supporters.
Last week, a national poll found that Republican voters broadly support the Democratic jobs agenda — a payroll tax cut, jobs for teachers/first responders, infrastructure investments, and increased taxes on millionaires and billionaires — in some cases by wide margins. This week, Tim Noah noticed this observation can be applied even further.
I’m liking rank-and-file Republicans better and better. Earlier this month we learned that they favor Obama’s plan to tax the rich. Now we learn that a 55 percent majority of them think Wall Street bankers and brokers are “dishonest,” 69 percent think they’re “overpaid,” and 72 percent think they’re “greedy.” Fewer than half (47 percent) have an unfavorable view of the Occupy Wall Street protests. Thirty-three percent either favor them or have no opinion, and 20 percent haven’t heard of them. Also, a majority favor getting rid of the Electoral College and replacing it with a popular vote. After the 2000 election only 41 percent did. Now 53 percent do. How cool is that?
Every one of these positions puts the GOP rank-and-file at odds with their congressional leadership and field of presidential candidates.
I don’t want to exaggerate this too much. The fact remains that the Republican Party is dominated by conservative voters, especially those who participate in primaries and caucuses. I’m not suggesting for a moment that the party’s rank-and-file members are moving to the left.
But the recent poll results are also hard to miss — many if not most GOP voters are perfectly comfortable with plenty of progressive ideas, including tax increases on millionaires and billionaires. It’s starting to look like the party’s rank and file is made up of mainstream conservatives who want their party to help move the country forward.
And yet, when we look to Republican officials in Washington, how many GOP members of Congress are willing to endorse any of these popular measures? Zero. Literally, not even one Republican lawmaker has offered even tacit support for ideas that most GOP voters actually like. In the Senate, a united Republican caucus won’t even allow a vote — won’t even allow a debate — on popular job-creation ideas during a jobs crisis.
If the actions of GOP lawmakers in any way resembled the wishes of GOP voters, our political system wouldn’t be nearly as dysfunctional as it is now.
Congratulations, congressional Republicans. You’re far more extreme than your own supporters.
By: Steve Benen, Washington Monthly Political Animal, October 25, 2011
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