By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
By Anna Merlan
By Lee Escobedo
By Eric Nicholson
But if Romney played the friendly politician, kindness wasn't his specialty at Bain. He was generous to ranking executives, rewarding CEOs with huge bonuses. Yet he tended to treat those below his pay grade as little more than machinery.
Romney has repeatedly claimed to have created 100,000 jobs at Bain, and says that providing work for Americans was a primary company goal.
But Bain bought Domino's just months before Romney left to run the Salt Lake City Olympics, meaning someone else created those jobs. And he didn't manage Staples or Sports Authority; Bain was a minority investor in both.
By Romney's logic, any large investor — say, the Texas teachers' pension fund — also creates hundreds of thousands of jobs. The boast is so foolish that his campaign has since backed away from it.
Even Kaplan admits that private equity firms rarely create jobs. Workers are seen as costs, and costs are the enemy. According to Kosman, Romney was in truth among the most heinous job killers of them all.
While writing his book, Kosman conducted an interview with a Bain managing partner. The man told him that when Bain was about to buy a company, its partners would hold a meeting. "He said that about half the time [they] would talk about cutting workers," Kosman says. "They would never talk about adding workers. He said that job growth was never part of the plan."
That claim was buttressed by The Associated Press, which studied 45 companies bought by Bain during Romney's first decade. It found that 4,000 workers lost their jobs. The real figure is likely thousands higher, since the analysis didn't account for bankruptcies or factory or store closings.
An example of Romney's cold-blooded approach is his 1994 purchase of Dade International, an Illinois medical-equipment company. He soon merged it with two similar firms, a move that tripled sales.
Once again, he couldn't help but raid the vault, peeling away $100 million for himself and investors at the same time Dade was laying off 1,700 American workers.
After Bain closed a Dade plant in Puerto Rico, human resources manager Cindy Hewitt was asked to lure a dozen of those employees to work in the company's Miami factory.
But that plant soon closed as well. Though Romney was gobbling up millions, Bain still wanted those laid-off employees to repay their moving costs.
"They were treated horribly," Hewitt told The New York Times. "There was absolutely no concern for the employees. It was truly and completely profit-focused."
Yet Bain's molestation wasn't complete. It was trying to sell Dade, but didn't like the offers it received on the open market. So it created an artificial market of its own.
In 1999 it forced Dade to borrow $242 million, which was used to buy back company stock from Bain, Dade executives and their banker, Goldman Sachs.
Bain was again extracting profits with borrowed money. It had pushed Dade's debt to a bracing $2 billion. To help pay for the deal, the company laid off another 367 workers.
But that debt proved too much for Dade's shoulders to carry. Three years later, the company was bankrupt.
Kosman calls it standard Romney operating procedure. To pump short-term earnings, he would essentially "starve a company," whacking not just employees, but customer service and research-and-development funding — the very ingredients of long-term prosperity.
"I think they're one of the worst, at least during Romney's time," Kosman says. "They were very aggressive about dividends. They were very aggressive about borrowing the most money they could. He's very driven to be the best he could be, and that was to be as cutthroat as he could be. But in the process, he hurt a lot of companies and cost a lot of jobs, maybe tens of thousands of jobs."
Kosman says it's telling that Romney never cites companies he actually managed as evidence of his job-building skills.
"If Romney had some stories to tell, he'd use those stories," he says. "I think it's very interesting that he's not telling those stories, because I think they don't exist."
The Welfare Queen
Romney's economic views were on stark parade during this year's Michigan primary. He ripped President Obama for bailing out the auto industry, arguing that it should have been dealt with in his favorite resting place: bankruptcy court.
He was particularly incensed that the president rescued workers' pension funds before covering Wall Street's bad loans.
But his faith in the free market wobbles when his friends need rescuing. Romney just as vigorously defends the $10 billion government bailout of Goldman Sachs, his investment partner at Bain.
After all, Romney frequently assumed the role of welfare queen himself.
In 1988, he bought South Carolina photo-album maker Holson Burnes. In exchange for the firm's promise to build a new factory, the people of Gaffney, South Carolina, gave Bain $5 million in bonds and $200,000 in utility upgrades.
The plant closed just four years later. The 100 jobs there were later shipped to Mexico.
At GSI, he dumped $44 million in pension shortfalls on the federal government. And when he bought mattress-maker Sealy in 1997, he took $600,000 in welfare to move the firm from Ohio to North Carolina.
I'm figuring it will only take another 10 years or maybe less, for humanity to tire of this and start the extermination. Lobbyists or Republicans, who knows which will be first to go!!!!
Free Market is not Capitalism, it is chaos and doesn't work. True Capitalism needs to be heavily regulated and Capitalism, the economic system, not the capitalist, is the primary consideration.
We are the worst possible example of what could be an ideal economic model.
Your conversation style is akin to kicking over trash cans and running, skipping, holding hands and giggling with your playmates.
did you not read the article? profitable companies with hard working employees are bought and guys like Romney use the company to get credit (which they can because the company WAS MAKING MONEY) they pay themselves and then leave the company to rot and to pay all the debt. Can someone please explain me how the F@#CK can you call that good capitalism
The real villain wasn't Romney or his kind, but the original owners who cashed out and threw their company to the wolves.
Josh Kosman is a media hack. His biased one sided stories are the worst sort of journalism, lies and distortions. This is why he writes for the Dallas Observer. His tripe is more suited for the National Observer. His source is a disgruntled union member. Kosman leaves out that Romney left Bain Capital 2 years before GS Industries filed bankruptcy. Or that Bill Clinton's kneeling lip jobs to the Chinese and union greed killed the US steel market leading to several steel companies going belly up including Bethlehem Steel.
More BS by the socialist Observer, hey earth to Observer, this is a CAPITALIST economy, (sort of at least it use to be) Socialism doesn't work, witness Russia, Europe and China that is now more capitalistic than we are! (and they are rubbing our faces in it!) We are now in a world economy and it's either compete or perish. The days of big labor are over with, if you don't believe it look at Europe. With the recent events in France look forward to it only getting worse.
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what the hell is wrong with you?youve read a story about man whose job was to shut down businesses (which put people out of work),move it to mexico and write himself a fat check and wants to be president and all you can do is finger point which political part did what or is worse! theres no difference between the parties because they are all rich like romeny.most of you are pathetic and contribute to the problems you complain about!
Long story, but worth the read. It just goes to show that because you have money and you know how to make it, it does not mean that you are right to lead this country. We need someone who will restore the country, not the same old BS where the politicians look out for thier own pocket books instead of looking out for the people they represent. Ron Paul 2012!
And perpetual politician and "waitress sandwich" womanizer Teddy Kennedy was not a parasite? You guys are pathetic... (lol)
Go down thru history and you will find many, and I believe more than Republicans, presidents were Democrats and rich before taking office. They made their money off the sweat and misfortune of others Cleveland, Van Buren, Monroe, Clinton, Tyler, FDR, Johnson, Madison, Jackson, Jefferson, Washington and least but not last JFK. They may have been pricks in business but not all ran the country in to the ground as president like Obama will do given 4 more years to complete the job!
This is not a partisan conversation, it is about the rape of a country which relies on an economic system that, when respected, is the greatest in the world. Both political parties are complicit in enabling huge holes in the protective wall around our economy that allows unscrupulous people to "game" the system at the expense of hard working owners and workers in the American business community. You'd really have to read the article to figure that out though and, well, it does have a few big words in it.
Other's action can not be used to rationalize evil deeds. I don't who else did it. It is just wrong period.
The Republican Party needs a transformation. This country needs to get away from Corporcrat rule, which is what Mitt Romney and Obama are all about. Young people, the future of our country, recognize someone who can direct us back in the right direction - - towards true LIBERTY for its people. RON PAUL has the right message to reinvigorate the Republican Party. Mitt Romney is its doomed past.
Mr. Kosman, and David Foster talk like typical union people(yes I am one also) If Romney is a parasite, and vulture, then please tell me just what is Obama? He is a communist, and never worked a day in his pathetic life. Community organizer, Ha! what a laugh. Even now as president he has a hard time working like a president should, vacation after vacation. I agree I can't wait until election so I can vote for Romney. I agree with Thomas_Avit. The Republoican party does need a transformation, and people like the tea party people are trying to do just that, by getting rid of all the old moderate conservatives like Richard Lugar and others. I like RON PAUL but I don't like his foreign policy. Mr Avit needs to read more history. Ron Paul is an isolationist---That is exactly what got the world into WWII. The world let Hitler go too long without trying to stop him. Don't wait on the young people to lead the U.S. out of this mess, they tend to go for guys like Obama. YOU Mr. Avit probably would not vote for the right person to lead us back to a strong nation. Tell me,Did you vote for Reagan? I'll bet you didn't.
What a dumb person you are. You must be wealthy too and have done the same thing costing people their jobs, homes, cars and way of life and you think that's okay. And you even called that working... The president worked many days of his life and the only sorry, useless person in this scenario is Mitt Romney a destroyer of families and their dreams so he could be wealthy. A disgrace to mankind.
Did you even read the article? - eg Romney - like so many private investors and big corporations - used taxpayer money to fund their investments - paid themselves and walk away after taking the companies. Being a CEo doesn't mean someone is a good President. Both our parties work the system - but Republicans are the biggest hypocrites because they take government money and then badmouth it as if they don't. And President Obama isn't a communist - do you even know what that word means? Apparently most Republicans are either over the age of 60 are not well educated -- their points of reference - Hitler; Nazis'; Marxism -- are outdated and irrelevant. And it was Nixon and George Bush Sr. who proudly opened up the doors for our country to do business with China - Bush Sr. turning his head as tanks ran over students in Tieaman Square. People like Romney criticize China - yet all do business with them - and they ARE communists. At least Democrats pretend to want to help people - wherewas Repbulicans try to blame everything on the poor, unemployed and workers who actually make our economy work. If our minimum wages was higher, then our gov't wouldn't have to help as many people. It's the Mitt Romneys of the world - who are born rich but yet take tax money to continue to line their pockets - who are the true "evildoers." As for Reagan - he was the cause of our gov't deficit -- if you actually can read - go back and you'll discover that when he cut taxes for the rich - our gov't deficit began. And the results of that were why George Bush Sr. had to raise taxes and was voted out of office. The same is hapning now -- Baby Bush tanked our economy and now the Republicans try to blame President Obama - some things never change. But ask yourself -- if things are so bad - how is it the 1% have made even more money even during the worst recession in a half century?
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Wow. I was going to vote for Romney. Looks like I have more reading and research to do. Interesting story. I may still vote for him.If it ends up Romney versus Obama; I will definitely vote for Romney. He is the better of the two evils.
Mitt's a job creator in the same sense that Lucifer is a soul saver. No more, no less. He helps his friends, which amount to an extremely small group. Everyone else pays a steep price, and Mitt feels no remorse. None at all. If you hope for more than that, you're pipe dreaming. nothing more.
alot of firms under the tutelage of the Fed sent the country to ruin some don't exist anymore so what is the moral imperative, make Chavez President because we need to do good for the proletariat? Capitalism never ran that way at best trickle down good times after a holocaust No we aren't that big a losers just a little slow sometimes when misguided, if you don't like Romeny then vote for Ron Paul but don't vote for big governement and suppression of entrepeneurialsim unless your an A 1 leach or satisfied on a welfare haul
You can't trust unions, the govt, or extreme profit minded, ok, greedy corporate types. What's left?
After reading this, I don't have much regard for Romney. However, the article makes the companies out to be the victim.
Anyone stop to think that that's what the CEO of said companies were shopping for when they partnered with Bain?
I know when CompUSA went under that's precisely what they had in mind when they liquidated the company. They weren't trying to get back on their feet.
Sure, great story, if you take everything it says as the gospel. How about a story regarding how unions destroy companies by draining them for THEIR profit? Union bosses get rich and the workers get the shaft after it's all said and done. Ask auto workers, American Airlines pilots/mechanics, steel workers. But they did one thing good, they provided a great atmosphere for robotics companies to flourish!
that would be a great topic if this story was about Unions. Its not. Stick to the topic. Your boy is a pariste. deal with that on election day.
Last time I checked union members elected their leaders, don't cry when you do nothing to change the folks at the top, then complain when they continue to do the same thing over and over again.
Badmann,Corporations of the likes run by Romney are robbing you blind while they distract you w/the fear of losing your liberties! Open your eyes man. Freedom should not come at the price of losing your home, your healthcare, and your job to the 1%!!!
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Thinking progressively? If you mean thinking like a progressive, you are wanting us to reach the end of the road we are now on rather than turning around and taking a different course. Progressivism means you have no natural rights. That means you only have rights that the government allows you. I hardly think surrendering our liberty is the way to prosperity.