[h/t Heather at VideoCafe]
Let's walk down memory lane and recall Ed Gillespie's defense of Mitt Romney's outsourcing activity last month. Then take a walk a little farther and recall how the Romney campaign pressured the Washington Post to alter their story about Romney's Bain Capital involvement in outsourcing jobs to China, and how they were able to co-opt Factcheck.org to carry their water.
It's time for Romney to give up the line in his stump speech about being tough on China's trade practices, because Mitt Romney personally and directly benefitted from them.
If you look around your kitchen, I'll bet you'll find at least one product with parts manufactured in China. Chances are, those parts were manufactured by Global-Tech, a company with Mitt Romney's hands all over it.
On April 17, 1998, Brookside Capital Partners Fund, a Bain Capital affiliate, filed a report with the Securities and Exchange Commission noting that it had acquired 6.13 percent of Hong Kong-based Global-Tech Appliances, which manufactured household appliances in a production facility in the industrial city of Dongguan, China. That August, according to another SEC filing, Brookside upped its interest in Global-Tech to 10.3 percent. Both SEC filings identified Romney as the person in control of this investment: "Mr. W. Mitt Romney is the sole shareholder, sole director, President and Chief Executive Officer of Brookside Inc. and thus is the controlling person of Brookside Inc." Each of these documents was signed by Domenic Ferrante, a managing director of Brookside and Bain.
At the time Romney was acquiring shares in Global-Tech, the firm publicly acknowledged that its strategy was to profit from prominent US companies outsourcing production abroad. On September 4, 1998, Global-Tech issued a press release announcing it was postponing completion of a $30 million expansion of its Dongguan facility because Sunbeam, a prominent American consumer products company and a major client of Global-Tech, was cutting back on outsourcing as part of an overall consolidation. But John C.K. Sham, Global-Tech's president and CEO, said, "Although it appears that customers such as Sunbeam are not outsourcing their manufacturing as quickly as we had anticipated, we still believe that the long-term trend toward outsourcing will continue." Global-Tech, which in mid-1998 announced fiscal year sales of $118.3 million (an increase of 89 percent over the previous year), also manufactured household appliances for Hamilton Beach, Mr. Coffee, Proctor-Silex, Revlon, and Vidal Sassoon, and its chief exec was hoping for more outsourcing from these and other American firms.
The Boston Globe reports this morning that there is evidence Romney did not leave Bain Capital until 2002.
Mitt Romney has repeatedly sought to distance himself from some business dealings at Bain Capital by asserting that he left the firm in February 1999, but a review of public records shows that his authority lingered for three more years as Bain repeatedly listed him on government filings as the man in charge. Until 2002, when Romney and Bain Capital finalized a severance agreement, he remained the firm’s “sole stockholder, chairman of the board, chief executive officer and president,” according to SEC documents. The description was applied even to the creation of five new Bain partnerships a full three years after Romney has said he relinquished all control.
Lying on SEC documents is a very, very big deal. John Aravosis also goes back to FactCheck.org's defense of Romney's claims that he left in 1999 to point out that their defense puts him in a tight spot.
Either he lied on SEC filings or he's lying about when he left Bain in order to duck responsibility for Bain deals that caused people to lose their jobs as more and more of our manufacturing sector was shipped off to China.
There's nothing illegal about Romney remaining in charge, so why is he lying about it? As Romney would say, it's perfectly legal. It is true legal doesn't necessarily translate to something patriotic, or appropriate for a candidate leading the United States. It should cause people to question his claims about whether or not he would be sensitive to American job losses or simply "restructure" this country out of all of our manufacturing base.
Here's the bottom line: There's a lie here. It's either a lie on official documents subject to perjury enforcement, or it's a lie to the public. My money is on the latter, because this is what Romney does. He routinely lies in order to advance his cause or avoid confrontation. It's why he doesn't want to release additional tax returns and it's why he stubbornly clings to 1999 as his termination date. If you think about it, it's actually more reasonable to assume he did stay on at Bain through the Olympics, because those high-rolling corporate contacts could come in handy with efforts to revive an effort that was nearly dead and buried.
In "The Real Romney," many words are devoted to Romney's time at Bain and his investment philosophy. This was a particularly revealing passage:
But [Romney] bought into the broader ethic of the LBO kings, who believed that through the aggressive use of leverage and skilled management they could quickly remake underperforming enterprises. Romney described himself as driven by a core economic credo, that capitalism is a form of "creative destruction."
But as even the theory's proponents acknowledged, such destruction could bankrupt companies, upending lives and communities, and raise questions about society's role in softening some of the harsher consequences. As Greenspan once put it, "the problem with creative destruction is that it is destruction and there is a very considerable amount of turmoil that goes on in the process."
[Romney] acknowledged that it is "unquestionably stressful -- on workers, managers, owners, bankers, suppliers, customers, and the communities that surround the affected businesses." But it was necessary to rebuild a moribund company and economy.
Based on that foundation, my question for Mitt Romney is how a moribund economy benefits from "creative destruction" where the outcome means removing the company from the economy altogether and sending it overseas.
More fundamentally, why is he lying about this? And who did he lie to?
Update: 11:45 AM Politico (aka Republico) is trying very hard to be a zombie lie-killer, and includes Bain Capital's statement "confirming" that 1999 is when Romney left. Except that, well, there's those pesky SEC filings. If he left in 1999, why is he still the sole owner? Why were five new Bain entities created in 2002 listing him as sole shareholder, owner, and chairman? Bain explains that away too, saying that he was simply there in name only, but with no real say in what was happening at the time.
But wait, there's more! For anyone with a memory that stretches back a few years, you may remember that Mitt's residency was challenged at the time he ran for Massachusetts' governor because he was involved with the Olympics. In a sworn deposition given on June 17, 2002, Romney said he returned to Massachusetts for business trips and the like all the time. Here's the image:
He also admits to remaining on a "number of boards," but specifically notes that he resigned from the Sports Authority board in order to avoid a conflict of interest with his Olympic responsibilities. Specifically, he said this:
Q: Now you mentioned earlier that you were a member of a number of boards. Did you continue to serve on any of those boards during the time that you were serving the Olympic effort in Utah?
A: Yes. I immediately resigned from the board of the Sports Authority located in Florida. Feeling it could present a conflict of interest with my Olympic responsibilities and of course the travel could be challenging as well. I remained on the board of the Staples Corporation, and Marriott International, the Life Like Corporation. And I remained as a corporator of the Belmont Hill School.
Q: Now with respect to your membership on the Staples Board. Do they have meetings from time to time I assume?
A: We have approximately four to five meetings per year.
Q: And during the time that you were in Utah did you return to Massachusetts for any of those meetings?
A: I returned for most of those meetings. Others I attended by telephone if I could not return.
You be the judge. Are these the answers of a hands-off, I signed it all over to my partners kind of guy? Either he actually resided in Massachusetts or he didn't. Either he was the sole Director of Bain or he wasn't.
More like this
- Steve Benen at MaddowBlog
- Suburban Guerrilla
- daily howler
- The Black Snob
- Lawyers, Guns & Money
- Brad DeLong
- Jesus General
- Rising Hegemon
- Mock, Paper, Scissors
- The Reality-Based Community
- The Moderate Voice
- Nicole Sandler - Radio or Not
- Talk Left
- Vagabond Scholar