Kind of tells you everything you need to know about who's more likely to stand up for American workers, doesn't it?

Via Mark Crispin Miller.

UPDATE: According to Buzzfeed, it's either a hoax or a shot of a knockoff; Romney & Co. insist their gear is made in the USA.

Karoli wrote about the original video on Friday, which in and of itself, stands as a shining example of the callousness of Republican vulture capitalism.

Now imagine how it would feel to someone reeling from the effects of Romney's business model?

Employees of the Bain-owned company Sensata, about whom Kenneth blogged about back in June trying to save their jobs from being outsourced, watched the video and were asked for their reactions.

Not surprisingly, they had some very harsh words for the Republican candidate.

If you want to know what the “Romney Economy” is, why don’t you look up Sensata in the book and see what Sensata’s doing for the people of Freeport, Illinois. If that’s what you want for your future….but I’m sorry to tell you that’s not what I want for my future.

DOWNLOADS: 89

PLAYS: 302

Embed

The story about Romney's tenure at Bain and his inconsistencies lies about when he left is a very, very big deal. This should be self-evident, but in case it's not, let me be specific. The core of Romney's campaign is that he can jumpstart the economy in ways Barack Obama cannot. He points to his time and successes at Bain Capital as evidence of his ability to lead. But those successes did not build the economy at all. They made really large profits for investors, but they left thousands out of work as jobs were shipped overseas or just eliminated altogether, forever.

One might think that a seasoned reporter like Andrea Mitchell (aka Mrs. Greenspan) might be really concerned about those lies, because well, aren't journalists supposed to be interested in truth? Please, don't bury me in your laughter.

In Mrs. Greenspan's case, it would appear that she is more interested in rehabilitating the notion of outsourcing than she is in actually looking at the snake oil the current presumptive Republican nominee is selling.

MITCHELL: What do you think the larger import of this is? In terms of Mitt Romney's career at Bain, what it says about himself. What are you trying to suggest, if in fact, he was in some role at Bain according to the SEC filings four years beyond when he says he left for all intents and purposes to go to the Olympics? What is the larger point, in terms of his qualification to be President?

In case that question isn't answered in anyone's mind, please refer to the first paragraph of this post. Really? Shorter Andrea Mitchell: So he lied? Why does that matter?

Stephanie Cutter answers pretty clearly. Again, refer to paragraph one of this post. That's followed by Ben LaBolt patiently explaining that it really does matter because President Obama's plan for the country is to reward companies for bringing jobs back to the United States, whereas Romney's rewards outsourcing. To which the intrepid Mrs. Greenspan asks this:

MITCHELL: Do you think outsourcing is a bad thing for the economy? Do you reject the suggestion that outsourcing is part of the normal ebb and flow of global trade, that it helps farmers in Iowa as much as it helps some auto workers in some cases?

The campaign's answer was to point out that we can either join a race to the bottom or lead a race to the top. It was a good one, but REALLY?

Do you think outsourcing is a bad thing for the economy? The magical economy with magical markets that doesn't give one rat's @ss about whether or not that family of four has to go on food stamps because the jobs moved overseas, or whether the only people who can actually afford a home are zillionaires?

Are we supposed to just overlook the care with which Mitt Romney has disguised his Bain career to deny involvement with outsourcing -- to the point of trying to bully a national news publication -- in order to have a meta discussion about outsourcing as a good or bad thing?

If we make stuff, the country (and the economy) does better. Forget all the argle bargle about "ebbs and flows." People work, they spend, the economy grows. When the work dries up, so does the economy. More to the point, this is about whether Mitt Romney LIED -- said things that were untrue -- in order to advance his ambitions for the White House.

Please, Mrs. Greenspan. Can we possibly pay attention long enough to look at what the candidate is doing rather than defending outsourcing as a global economic "good thing"?

Grrrrr. At the risk of sounding cliche´, this is why we can't have nice things.

One more time: Romney is lying. Either he was involved in outsourcing jobs and is lying to all of us, or he wasn't, and he lied to the SEC. That is a BFD, global economy or not.

What happens when factcheckers become tools of a Presidential campaign? They step into the place of actual journalism, even when that step puts them squarely at odds with investigative reporters who actually report facts sometimes.

The Washington Post's recent article on Bain Capital and Mitt Romney's role in outsourcing jobs to India and elsewhere confirmed what the Obama campaign had been attacking all along -- Bain Capital was in the business of making money, not creating jobs, rendering Mitt Romney's claim that he knows how to create jobs bogus. Despite the pearl-clutching Democrats who whined about attacks on Bain, there's no question that ads like the one at the top of this post are effective in critical swing states.

Those ads aren't effective because they tell lies. They're effective because they ring true, and the people most affected by Bain moneymaking ventures actually live in those states.

The attacks have so upset the Romney campaign that they actually sat down with the Washington Post in order to strong-arm them into changing their story so that all of the Bain decisions impacting workers happened after Romney left as an active Bain partner. That story stood in direct contradiction to the claim of Washington Post factchecker Glenn Kessler, leaving Romney with the sole option of using factcheckers to dispute the Obama campaign's claims.

Brooks Jackson of Factcheck.org was happy to comply with the Romney desire to change that story to one more favorable to Romney last week. After being challenged by the Obama camp, Jackson followed up a subjective hissy fit, Jackson calls the Obama campaign's claims "all wet."

Jackson's claims hinge on an assumption that just doesn't pass the smell test. In order to accept that Factcheck.org's facts are actually facts, one must accept this: Events occurring after Romney mounted his dressage horse to save the Olympics are completely disconnected and unrelated to the time when Romney was firmly in control of the reins at Bain Capital.

That just isn't how the corporate world operates. Not even close. Here's an example, where Factcheck claims that Romney had nothing to do with outsourcing jobs while at Bain:

Continue reading »

When the Obama campaign started raising questions about the way Bain Capital operated when Romney was the CEO, some Democrats who are close to Wall Street immediately starting complaining. We shouldn’t be attacking “capitalism”, they said, or the financial industry. But those Democrats are looking pretty foolish after the stories that have come out over the past few days. It has never been capitalism or even the financial industry being attacked when Bain’s style of operating is the subject: it is the worst kind of vampire capitalism that the Obama campaign is going after.

The idea of questioning Bain has always been essential to this campaign, because Romney has made clear that his main qualification to be President is the work he did at Bain. As the New York Times put it in their story Saturday “Companies’ Ills Did Not Harm Romney’s Firm”:

“Mr. Romney’s experience at Bain is at the heart of his case for the presidency. He has repeatedly promoted his years working in the “real economy,” arguing that his success turning around troubled companies and helping to start new ones, producing jobs in the process, has prepared him to revive the country’s economy. He has fended off attacks about job losses at companies Bain owned, saying, “Sometimes investments don’t work and you’re not successful.” But an examination of what happened when companies Bain controlled wound up in bankruptcy highlights just how different Bain and other private equity firms are from typical denizens of the real economy, from mom-and-pop stores to bootstrapping entrepreneurial ventures.”

But now, with this major new NYT story, plus the Washington Post pioneer-in-outsourcing story, it is becoming increasingly obvious to everyone why the Obama campaign and people like me have been making a big deal about Bain for a long time. All capitalism is not the same, and Bain is right up there with companies like Goldman Sachs in the sleaziness with which they make their money. What Bain did in buying these companies was to create a structure where they made money no matter what. As the saying goes, it’s nice work if you can get it- but you can’t get it unless you are willing to be absolutely brutal in pursuing your own profits at the expense of everyone else. What Bain did wasn’t just capitalism, but the worst sort of capitalism. As the NYT and other media sources have so explicitly laid it out, at least 7 Bain-owned companies went bankrupt, but “Bain structured deals so that it was difficult for the firm and its executives to ever really lose, even if practically everyone else involved with the company that Bain owned did, including its employees, creditors and even, at times, investors in Bain’s funds.” Bain loaded these companies with debt, in part so they could pay Bain millions (sometimes tens of millions) of dollars in fees. They then wrote off the debt on their taxes. In some cases (at least 4 times according the NYT story) Bain amassed huge short term profits before the companies, weighed down with the debt Bain forced on them, sunk under the weight of that debt.

Some of the companies Bain bought did better than that. Of course, some of those that did were out-sourcing and off-shoring pioneers. And others did better in great part by laying off huge numbers of workers and/or slashing the wages and benefits of many others. This is the track record that is “at the heart of [Romney’s] case for the Presidency”?

The debate over Bain-onomics is exactly the kind of debate this country should be having. We are at a make or break moment for the American middle class. What should our path forward be? Will it be the path of Bain and the biggest banks on Wall Street, which put profits over everything else, making millions because other people went broke and lost their jobs? Or will it be a path that invests in the health of our economy and the business sector from the bottom up? This is the fundamental choice for Americans: do we help and promote the kind of businesses that make and sell products and services here in America? Do we help the economy by investing in our people, giving them good education, college loans, and decent wages so they can buy goods from the small businesses in their community? Do we help our small businesses with start-up capital and giving them a fighting chance to compete with the big dogs? Or is our government going to be 100% geared toward the big incumbents who already have big money and market share and well-connected lobbyists who can get them sweetheart deals and tax breaks?

I think the Obama team has been absolutely right to engage all-out in this debate over Bain, and to frame this race as to who will fight for the middle class in their moment of need. This new ad shows they get it:

This Obama campaign ad received four pinocchios from the Washington Post's Glenn Kessler, the fact-checking guru of WaPoLand.

Regarding the outsourcing claims, we have frowned on these before. The Obama campaign rests its case on three examples of Bain-controlled companies sending jobs overseas. But only one of the examples — involving Holson Burns Group — took place when Romney was actively managing Bain Capital.

Regarding the other claims, concerning Canadian electronics maker SMTC Manufacturing and customer service firm Modus Media, the Obama campaign tries to take advantage of a gray area in which Romney had stepped down from Bain — to manage the Salt Lake City Olympics — but had not sold his shares in the firm. We had previously given the Obama campaign Three Pinocchios for such tactics.

The Modus Media case is also not an example of shipping jobs overseas. The company closed one plant in California and transferred the jobs to North Carolina, Washington and Utah. At the same time, it opened an unrelated plant in Mexico. The Obama campaign once trumpeted the fact that we had dinged a conservative Super PAC for making the same leap in logic.

Bad, naughty Obama campaign, misleading viewers that way. Oh, wait. Because the Washington Post also has this story running on page 1 this morning about how Romney did, in fact, outsource jobs to China and Mexico during his time at Bain Capital. And it directly contradicts Mr. Pinnochio-Giver Kessler:

Until Romney left Bain Capital in 1999, he ran it with a proprietor’s zeal and attention to detail, earning a reputation for smart, hands-on management.

Bain’s foray into outsourcing began in 1993 when the private equity firm took a stake in Corporate Software Inc., or CSI, after helping to finance a $93 million buyout of the firm. CSI, which catered to technology companies like Microsoft, provided a range of services including outsourcing of customer support. Initially, CSI employed U.S. workers to provide these services but by the mid-1990s was setting up call centers outside the country.

Two years after Bain invested in the firm, CSI merged with another enterprise to form a new company called Stream International Inc. Stream immediately became active in the growing field of overseas calls centers. Bain was initially a minority shareholder in Stream and was active in running the company, providing “general executive and management services,” according to SEC filings.

By 1997, Stream was running three tech-support call centers in Europe and was part of a call center joint venture in Japan, an SEC filing shows. “The Company believes that the trend toward outsourcing technical support occurring in the U.S. is also occurring in international markets,” the SEC filing said.

Stream continued to expand its overseas call centers. And Bain’s role also grew with time. It ultimately became the majority shareholder in Stream in 1999 several months after Romney left Bain to run the Salt Lake City Olympics.

Bain sold its stake in Stream in 2001, after the company further expanded its call center operations across Europe and Asia.

Oh, and there is more. Much, much more. Mr. Glenn Kessler should have to retract his judgment, though I'm certain he will follow in Politifact's footsteps and find a way to dig in harder. He will do this despite hard, factual evidence that Bain Capital not only invested in companies specializing in outsourcing services, but also invested in companies that moved operations overseas, just like the OFA ad claims.

Continue reading »

Matt Stoller has an absolutely stunning expose over at Republic Report. How cynical do you have to be to fire veterans to allow politicians to give patronage contracts to their pals - especially when it's for the Veterans Benefits Administration?

One of the basic pay to play schemes we see in most states and in the Federal government involves the privatization of government services to third party contractors who then kick back money through campaigns or lobbyists for increased privatization. It’s a transfer of state power from the public, which elects the government, to private actors, who increasingly control the data, the hiring standards, and the purchasing decision of the Federal bureaucracy.

Sometimes the kickback scheme is direct, and that’s illegal. But more often than not, it’s indirect. A firm, through subsidiaries or parent companies, hires a bunch of lobbying firms staffed by ex-officials. Then those ex-officials go to work to get the government to award contracts to the firm doing the hiring. The money flows in a nice circle of corruption.

This is just the latest example of indirect and legal bribery. Federal Computer Week reports:

In November, President Barack Obama signed into law the “VOW to Hire Heroes Act,” which included language to set up an expedited process for hiring returning solders for federal jobs.

But the VA’s own outsourcing, which began to grow under the Bush Administration and are continuing to expand, are abolishing many federal jobs currently held by veterans, the American Federation of Government Employees (AFGE), an AFL-CIO union, said in a Feb. 8 news release.

For example, the Veterans Benefits Administration recently entered into a $54 million three-year contract with ACS Government Systems to perform claims processing work.

That work currently is being performed by “large numbers of veterans,” the union said. “To add insult to injury, the VBA employees are being asked to volunteer to train the contractors to do their work.”

“Contract claims processors working for profit will now handle the most personal information of our veterans.” AFGE National President John Gage said in the release.

In several other outsourcing contracts in recent years, the VA also has gotten rid of many government jobs historically held by veterans, AFGE said…

The VA also has failed to comply with a 2009 law that requires the agency to do a cost-benefit analysis before each outsourcing contract is awarded, to determine whether the contract is cost-effective for taxpayers, the union said.
“The agency continues to violate federal law by contracting out work that has been traditionally performed by veterans,” the union said. “The outsourced jobs include many entry level jobs that disabled veterans rely on to get back on their feet after returning from the battlefield.”

ACS Government Systems spent $900,000 on lobbying in 2010, and the company itself is a subsidiary of Xerox. Xerox spent $1.25 million on lobbying in 2011. Lobbying firms hired by ACS include the BGR Group, Federal Advocates, B&D Consulting, Akerman, Senterfitt & Eidson, and Manatt, Phelps & Phillips.

On Wednesday, President Barack Obama announced a new initiative to combat outsourcing. The so-called 'in-sourcing' initiative would push a series of policies that would create jobs in the United States, including inviting more foreign companies to invest in U.S. jobs. Some of the suggested policies include tax breaks for companies that create jobs in the U.S. and tax disincentives for companies that continue to engage in outsourcing.

The White House announcement was made in conjunction with an in-sourcing forum that brought 14 large and small U.S. companies to meet with President Obama and discuss what kinds of policies might work to encourage the generation of jobs here instead of abroad. The 14 were Ford, DuPont, Otis Elevator, Intel, Siemens, ThyssenKrupp, Rolls Royce, Master Lock, Lincolnton Furniture, GalaxE Solutions, AGS, KEEN, Chesapeake Bay Candle and NOVO 1.

Some of the companies involved in the forum called for deregulation and lower corporate tax rates. Another tactic, used successfully by GM, is to increase productivity by increasing the use of automation and paying workers less.

Rep. Tim Bishop is calling on the president to focus on call centers:

In a letter, Bishop urged the President to consider the "U.S. Call Center and Consumer Protection Act," the bipartisan bill he sponsored to bar corporations that outsource U.S. call center jobs from receiving federal grants and loans, as a framework for Executive action to encourage the retention and growth of call center jobs in America.

Highlighting the fact that U.S-based call centers account for approximately three percent of jobs in the American workforce, Bishop wrote: "I hope your Administration will seriously consider the remedy my colleagues and I are confident will reduce the incidence of outsourcing by creating new incentives to insource call center jobs and provide a measure of stability and longevity to a sector of America’s workforce that needs our help as our economy continues to recover."

Bishop's "U.S. Call Center and Consumer Protection Act," which is co-sponsored by Reps. Dave McKinley (R, WVA-1), Mike Michaud (D, ME-1), Mike Grimm (R, NY-13) and Gene Green (D, TX-29), would require the U.S. Department of Labor to track firms that move call center jobs overseas; the firms would then be ineligible for any direct or indirect federal loans or loan guarantees for five years. The provision is partially a response to the practice of companies taking millions in incentives from local taxpayers to open call centers in the U.S., only to off-shore their operations a short time later and leave local communities devastated and still paying the bill.

Bishop's bill also requires overseas call center employees to disclose their location to US consumers and gives customers the right to be transferred to a US-based call center upon request. The legislation has the full support of the 700,000-member Communications Workers of America.

The Communications Workers of America have already come out in favor of this bill. India and the Philippines, the recipients of many of the outsourced call center jobs, are lobbying against the bill.

Herman Cain, who has made job creation a signature issue, was on the board of Whirlpool when the company engaged in a pattern of layoffs, outsourcing and the cutting of retiree benefits, all while accepting government subsidies and paying little to no taxes. Cain has made it clear that he doesn't understand jobs and the economy and has surrounded himself with people who don't know more than he does, but the Whirlpool example goes beyond a lack of understanding into an assault on American workers.

http://www.outsaurus.com/2011/11/04/outsourced-whirlpool/

Between 2008 and 2010, Whirlpool paid no federal taxes, despite sales of over $18 billion. In 2010, the company reported an effective tax rate of -10.9 percent. And the company continued to lay workers off and outsource their jobs after receiving $19 million in stimulus funds.

Cain joined the Whirlpool board of directors in 1992 and received payment for his work there as late as 2010. His compensation from Whirlpool ranged from $166,000 to $190,000 a year.

Outsourcing, as anyone who's ever had to manage a project staffed in another country will tell you, is rife with all kinds of pitfalls -- and it's almost never cheaper, no matter what Tom "The World Is Flat" Friedman would like you to believe. Boeing learned the hard way:

The 787 has more foreign-made content — 30% — than any other Boeing plane, according to the Society of Professional Engineering Employees in Aerospace, the union representing Boeing engineers. That compares with just over 5% in the company's workhorse 747 airliner.

Boeing's goal, it seems, was to convert its storied aircraft factory near Seattle to a mere assembly plant, bolting together modules designed and produced elsewhere as though from kits.

The drawbacks of this approach emerged early. Some of the pieces manufactured by far-flung suppliers didn't fit together. Some subcontractors couldn't meet their output quotas, creating huge production logjams when critical parts weren't available in the necessary sequence.

Rather than follow its old model of providing parts subcontractors with detailed blueprints created at home, Boeing gave suppliers less detailed specifications and required them to create their own blueprints.

Some then farmed out their engineering to their own subcontractors, Mike Bair, the former head of the 787 program, said at a meeting of business leaders in Washington state in 2007. That further reduced Boeing's ability to supervise design and manufacture. At least one major supplier didn't even have an engineering department when it won its contract, according to an analysis of the 787 by the European consortium Airbus, Boeing's top global competitor.

Boeing executives now admit that the company's aggressive outsourcing put it in partnership with suppliers that weren't up to the job. They say Boeing didn't recognize that sending so much work abroad would demand more intensive management from the home plant, not less.