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A new ad from MoveOn.org features two steelworkers who lost their jobs when Mitt Romney and Bain Capital took over the Kansas City steel plant they worked at and shut it down. The story represents a larger pattern at Bain, the company that Romney helped co-found. Romney often cites his time at Bain as evidence he is a proven job-creator, but the record shows otherwise:
Bain’s modus operandi was to invest in companies, leverage them up with debt, and then sell them off for scrap, allowing Bain’s investors to walk away with huge profits while the companies in which Bain invested wound up in bankruptcy, laying off workers and reneging on benefits.
Last week, Reuters profiled one company, Worldwide Grinding Systems, that went belly up after Bain invested in it. The company not only lost 750 jobs, but the federal government had to come in to bail out its pension fund, while Bain walked away with millions in profits.
And according to an analysis by the Wall Street Journal, this was far from an isolated incident. In fact, 22 percent of the companies in which Bain invested wound up either in bankruptcy or shutting their doors entirely, while Bain itself has made billions of dollars for its investors...
Adding insult to injury, Bain would hide its profits in tax havens, not even paying the rate it was supposed to on the profits it made laying off workers.
Romney has tried to spin his firm’s record of destruction as simply the way “free enterprise” works, claiming that Bain, overall, created 100,000 jobs. However, the campaign recently admitted that the 100,000 statistic is bogus, cherry-picked from a few successful ventures. One of Romney’s former partners at Bain has even said, “I 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.”
Republican rivals for the presidency have already jumped all over this story with, Rick Perry weighing in, a super PAC supporting Newt Gingrich running ads about the Bain story and Gingrich himself going on the offensive:
Said Gingrich: “They apparently looted the companies, left people unemployed and walked off with millions of dollars. Look, I’m for capitalism, I’m for people who go in to save a company… if somebody comes in takes all the money out of your company, and then leaves you bankrupt while they go off with millions, that’s not traditional capitalism.”