This post has been updated (see bottom of second page).
In the great politico-media debate over Mitt Romney, Bain Capital, and outsourcing, writers here at CJR have generally come out in support of the factchecking sites that criticized the Obama campaign’s ads—but have also called for more reporting, both to resolve the question of when Romney gave up control of Bain and to inform larger debates that are beyond the ken of the factcheckers.
Today, The Boston Globe’s Beth Healy and Michael Kranish have a bit of reporting that everyone who’s followed this tussle should read. The Globe piece asserts up high that Romney “was not merely an absentee owner” after he took a leave of absence to run the Salt Lake City Olympics in February 1999, and it cites an interview with a Duke professor who doesn’t really believe Romney’s claims of being entirely out of the loop after that point. But the story also makes clear that Romney wasn’t running the show after leaving for Utah, and that his departure precipitated a major transition at Bain—with investors keenly aware that Romney was no longer managing the firm’s money. That’s basically consistent with what we already knew.
So why, then, did Romney remain Bain’s titular head for another three years? The article, which opens with a scene recounting a previously unreported meeting of Bain’s top management in early 1999, offers this explanation:
He signed dozens of company documents, including filings with regulators on a vast array of Bain’s investment entities. And he drove the complex negotiations over his own large severance package, a deal that was critical to the firm’s future without him, according to his former associates.
Indeed, by remaining CEO and sole shareholder, Romney held on to his leverage in the talks that resulted in his generous 10-year retirement package, according to former associates.
“The elephant in the room was not whether Mitt was involved in investment decisions but Mitt’s retention of control of the firm and therefore his ability to extract a huge economic benefit by delaying his giving up of that control,” said one former associate, who, like some other Romney associates, spoke only on condition of anonymity because they were not authorized to speak for the company.
Readers will make of this what they will. (Here are a pair of early responses.) But what matters from a journalistic perspective is that after all the ink and pixels spilled on this topic over the last couple weeks, Healy and Kranish have brought forth new information that—assuming it holds up—gives us a fuller understanding of what happened as Romney and Bain parted ways.
Meanwhile, there’s a line that goes by almost in passing in the Globe piece that suggests an opportunity for further reporting. Paraphrasing the worries of an unnamed Bain partner, Healy and Kranish describe Romney as someone “who excelled at bringing in investors, not at finding the companies to invest in and overhaul.” Bringing in investors is clearly an important business skill. But as Yoni Appelbaum notes on Twitter, the narrative Romney and his supporters offer about his private-sector experience emphasizes his managerial know-how, not his talents as a rainmaker. Any reporters care to pick up this thread?
On the subject of new reporting about Romney, Bain, and outsourcing, Mother Jones’s David Corn and Nick Baumann have a story out today detailing Romney’s substantial investments, through a Bain-related entity known as Brookside Capital Investors Inc., in two companies that produced components overseas for US-based tech businesses. The story recalls a July 11 Corn post that reported a Brookside investment in a third similar company.
In both cases, the Romney campaign replied that Brookside is a hedge fund that makes passive investments, not a private equity operation that gets involved in the management of companies it invests in. If that’s true, it means that Brookside’s investments don’t support the precise claims the Obama campaign made about Romney’s involvement in shipping jobs overseas, which is where this all started. On the other hand, MoJo’s pieces offer plenty of reason, if any was needed, to believe that whatever his current rhetoric, Mitt Romney doesn’t really have a deep-seated objection to offshoring.
This is gonna be tough for the "you didn't build that" crowd to grasp but if you actually do build a prosperous and respected firm of Bain's caliber you're probably not tossing the keys over without adequate compensation. If you were selling a valuable home would you let the new owners take occupancy and title before agreeing on a price?
Whether Romney was rainmaker or the one who shopped for companies to salvage does not preclude him from an integral role in turning around the companies ultimately chosen to salvage. Really are you suggesting he was relegated to rainmaker because he was clueless on the other aspects of the business he built? Moreover, there is no need to shop for the "entity" Romney hopes to salvage now - it's the one buried and debt and economic despair just south of Canada. Perhaps the flying monkeys should stop and think before jumping out the window when Axelrod bids them to fly.
#1 Posted by Mary, CJR on Sat 21 Jul 2012 at 04:02 AM
There is a big difference between Democratic and Republican approaches to economics in general which is why you have situations under democrats where the economy does better for the middle class and the poor and the economy does better for the top .01% and stagnates, if not collapses, under republicans.
Yes, there is a case to be made for DLC democrats have supported free trade at the cost of national sovereignty over economic policy and sector erosion. There are too many democrats who have stepped out of bed with Richard Trumka and into bed with Jeffery Immelt to deny this, but the difference is that even the most conservative democrats don't give away the store. Republicans do, they believe it is the right of the market masters to have dominion of he store, which was why you had industry lobbyists and former corporate officers appointed to head the regulatory bodies of their respective industries. It's an unfortunate distinction, but it's true - America is a two party system and Corporate America owns one and a half of it, but that unowned half makes a difference in the social policies which soften the blow of offshoring and outsourcing and provide the investment required to fashion new ladders of social mobility when the old ladders have been sold off to India.
This is the reality: under democrats you have support for social programs that protect citizens from the instabilities that arise in life and for the investments required to build the 21st century economy, funded by tax revenue.
under republicans, you have none of that. Unfortunately people refuse to believe Republicans are that bad.
http://www.nytimes.com/2012/07/08/magazine/can-the-democrats-catch-up-in-the-super-pac-game.html
"Burton and his colleagues spent the early months of 2012 trying out the pitch that Romney was the most far-right presidential candidate since Barry Goldwater. It fell flat. The public did not view Romney as an extremist. For example, when Priorities informed a focus group that Romney supported the Ryan budget plan — and thus championed “ending Medicare as we know it” — while also advocating tax cuts for the wealthiest Americans, the respondents simply refused to believe any politician would do such a thing. What became clear was that voters had almost no sense of Obama’s opponent."
And why don't people believe that Republicans are that bad? Because we have an equally bad political press:
http://videocafe.crooksandliars.com/heather/scarborough-and-halperin-accuse-obama-usin
These are horrible banal people.
If you want to look at who favors the American worker more, look at the direction of tax cuts and bailouts, of jobs under democratic and republican administrations, of laws vetoed and filibustered, at the business model of the candidate.
Yeah, Obama supports the market and free trade, since even in spite of his drastic support of banks, the wealthy, free trade, etc. he's considered an anti-american Muslim socialist.
But that is different from Mitt Romney's actual profiting from the actual liquidation of American labor. Mitt Romney and the teahadists are not the same as democrats when it comes to these issues - in fact you are going to see large pushes from the right to further dismantle the state so that the exploitation of work, environment, tax law, tax rates, and trade can be more efficiently realized.
They believe they are the job creators, and that the economic world revolves around the sun they generously provide. If you let that go unchallenged and just equate everybody as being the same, you will be doing great harm to the public.
As you did with your weak coverage during the GW Bush presidency.
#2 Posted by Thimbles, CJR on Sun 22 Jul 2012 at 04:48 PM