NEVADA — One of the moments in the 2012 presidential race that we all know was coming arrived this week: the Obama campaign launched its first round of attacks on Mitt Romney over his tenure at Bain Capital.
Unsurprisingly, there was a swing-state emphasis to the offensive. In addition to new TV commercials and a website targeting “Romney economics,” the President’s people organized news conferences in three battleground states—Iowa, Nevada, and Ohio—using labor leaders and prominent Democrats to attack the record of the presumptive Republican nominee. Their focus was Stage Stores, a chain of clothing stores that filed for bankruptcy and reportedly shed 6,000 jobs after Bain sold most of its interest in the company at a huge profit in the late 1990s.
The Obama campaign’s strategy also posed a challenge for reporters at local media outlets: Would they take the story served up on a silver platter, or get deeper into the complexities and provide the necessary balance? A look at some of the coverage shows a mixed response.
The president’s team was likely happy with the story by Las Vegas Sun reporter David McGrath Schwartz, posted online Tuesday and in print Wednesday. Here’s the lead:
With President Barack Obama’s campaign launching an offensive to paint Republican candidate Mitt Romney’s time as head of a private equity firm in a negative light, here’s the Nevada connection: Between 2000 and 2002, Stage Stores, a clothing chain, shut down three stores in rural Nevada as part of a bankruptcy.
The stores’ closures came after Bain Capital had sold off its interest in the company in 1999. Obama’s campaign said the chain had been saddled with debt after an aggressive expansion under Bain, and after Bain made $170 million profit from the investment.
That’s a straight recitation of the Obama attack, with a helpful pointer to a local connection. Then, after an acknowledgement that it’s unclear how many of those jobs were actually lost in Nevada, there’s this passage:
In Winnemucca, 166 miles northeast of Reno, Rich Stone, owner of a dry cleaner next to the former Stage Store, remembers the retailer as a fine fit for the community.
Since it closed, residents of the small town of 8,900 and surrounding Humboldt County can’t buy non-Western-themed clothes there. They have to travel to Reno or shop online, Stone said.
“It’s a void,” said Stone, who is also a city councilman and a Republican. “We lose a lot of sales tax revenue.”
In its place now is a Boot Barn, which sells Western apparel and boots.
Stone was philosophical about the store’s closure.
“That’s America. That’s capitalism,” he said. “If somebody’s not making money, they’re not going to do it. You’re not going to keep it open as welfare for people without jobs. That’s just common sense.”
Kudos to the Sun for finding a local person to talk about the local angle, and Stone seems to have no particular axe to grind. But there’s an obvious question here, lurking in that last quote, that could be made more explicit: if the Stage locations have been closed for 10 years and no similar stores have sprung up to replace them, maybe we can’t pin their closure entirely on Bain’s alleged financial malfeasance?
That’s followed by some boilerplate reply from the Romney campaign and some comments from an academic about the merits and demerits of private equity—all well and good. But as I reached the end of the article, I was surprised by its last paragraph:
Currently, Stage has 13,000 employees and 800 stores in the United States, according to the company’s website. That’s twice as many as after it filed for bankruptcy.
So Stage Stores has achieved a remarkable comeback, which seems like too salient a fact to bury at the end of the story. That revival happened after Bain gave up control of the company, of course, but so did the bankruptcy. And while there may be a good argument that Romney’s crew deserves the blame but not the credit, that case isn’t compellingly made in the Sun’s story.
(I shared my concerns with Tom Gorman, managing editor at the Sun, and asked about the process that led to the article. Gorman declined to comment. In an email, he wrote to me, “If we break down the back story of one story, and then we’re asked about another, and then another, where would it end?”)
Up in the northern part of the state, the coverage in the Reno Gazette-Journal wasn’t especially strong either; the paper’s account is mostly based on quotes from campaign water-carriers. The story, by Ray Hagar, does include this statement from Bain, which was issued Wednesday, after the Sun’s article was posted. Though it shouldn’t be taken at face value, it’s useful to look at alongside the Obama campaign’s attack:
Under Bain Capital’s ownership of Stage Stores from 1988 to 1997, the company doubled the number of stores, doubled the number of employees and grew revenues by 70%. When the company faced challenging economic times in 2000, Bain Capital had no management control or Board representation, and was only a small public shareholder. Today, Stage Stores remains a successful, publicly traded company, with over $1.5 billion in revenues and more than 14,000 employees.
But by far the best local reporting I saw on this subject this week came not from the Silver State, but from The Plain Dealer of Cleveland. That paper’s Stephen Koff turned in a smart, well-researched take on the Bain story when it first surfaced in January. This week, it was reporter Henry J. Gomez offering a closer look.
Gomez gives the bearers of the Democratic message, including former Gov. Ted Strickland, room to say their piece. Then, he asks: “But is Stage the best example for Obama’s new push against Romney?”
In supporting material released Tuesday, the campaign noted that Stage had more than 600 stores in 24 states before its bankruptcy. According to Stage’s web site, the company now operates more than 800 stores in 40 states. The campaign contends that nearly 6,000 employees lost their jobs during Stage’s bankruptcy. The company today employs more than double that number—about 13,000.
And while the campaign says 26 stores closed in Ohio, Stage’s web site lists 25 locations across the state. The stores operate under the Peebles and Moody’s names—brands acquired in the years following Stage’s 2001 reorganization.
A telephone call to a company spokesman was not returned. It is unclear if any of these stores shuttered amid Stage’s struggles and later reopened.
Regardless, this is hardly a case of thousands of jobs disappearing, never to return—a notion the Obama campaign suggested by, offering reporters a web link to “see where Stage Stores used to be located in Ohio.” Many of the cities marked on the Obama campaign’s map also appear on Stage’s map of current store locations.
Gomez’s story is not, and doesn’t pretend to be, the last word on the Bain-Romney storyline. To really tackle this subject, as CJR’s Mary Winter wrote in January, reporters “will benefit from a solid footing in high finance and venture capitalism, and experience reporting on private equity deals.” Few political desks at local newspapers are going to be able to bring that to bear on a one-day story.
But reporters can bring an appropriate skepticism about the campaigns’ messages of the day, and a readiness to take on those messages when they don’t measure up. With one question—“But is Stage the best example for Obama’s new push against Romney?”—Gomez did that here, separating the wheat from the chaff. It’s a good example to his fellow journalists, who must strive to provide news consumers with more than the simple chaff that the campaigns will continue to serve up in the coming months.