Mitt Romney’s campaign is launching its first significant pushback against the latest wave of attacks on Bain Capital. Recent polls indicate Obama’s Bain message may be influencing swing-state voters.
On Wednesday, Romney aides met with Washington Post editors to demand the retraction of a recent story on Bain Capital’s investments in companies that specialized in outsourcing jobs. The Obama campaign quickly cut an ad based on the Post’s reporting and both President Obama and Vice President Biden have hammered the issue in tough campaign speeches this week. A Washington Post representative told TPM after the meeting that the paper stood by the story.
In a new twist, the Romney campaign is readying a filmed response to the attacks that features a former executive at one of the Bain-owned companies that Democrats have cited as a victim of layoffs and bankruptcy after Romney’s private equity firm took over. The campaign has not officially released the new video, but it accidentally went up on YouTube and was grabbed by Politico before being quickly taken down.
Former GST Steel Vice President B.C. Huselton explains in the video that the company was in dire straits when Bain took over, and that the firm did its best to save them.
“There’s this vampire story that Bain comes in and shows its teeth and sucks the blood out of the operation,” Huselton reportedly says in the video. “It was really entirely the opposite of that. We went looking for a blood donor.”
Part of the reason Romney’s opponents considered GST Steel such a powerful story, however, is that the company closed a Kansas City factory with 750 employees and ultimately went bankrupt, but Bain still made a hefty profit. According to a recent New York Times story examining the company’s fate and similar Bain investments, Bain pocketed over $9 million in consulting fees and dividends. Romney has defended Bain in the past by insisting that it was always in Bain’s interest to see companies succeed after being purchased, but critics say cases like GST Steel are examples of wealthy investors playing a rigged game.
“Did it all work out? The answer is ‘yes’, it worked out perfectly for Mitt Romney as he made $31 million,” Bill Burton, a Democratic strategist at pro-Obama super PAC Priorities USA, said in a statement. “But the 750 workers who lost their jobs and benefits after Romney drove the company bankrupt have a very different perspective. The Kansas City steel mill is part of a pattern of Romney profiting even when he drove companies into the ground, workers lost everything and the government had to pick up the tab.”
In the past, Romney has responded to attacks on Bain Capital by highlighting its success stories and accusing opponents of undermining capitalism. Romney often refers to office giant Staples, for example, where the firm was an early investor. A web video in May, released after a separate Obama ad referring to GST Steel, featured workers at Steel Dynamics recounting how the company grew significantly under Bain. But the latest video and the campaign’s aggressive push-back against the Washington Post represents a new direction, suggesting that they feel the need to explain Bain’s less attractive side.
Update: The Romney campaign released a 10-page presentation declaring the Post article “false” that includes statements from several CEOs at the companies denying they were a “pioneer” in outsourcing and claiming they created jobs in America as they grew and that many of their operations abroad were aimed at expanding U.S. exports. It also notes that two of the six companies cited were bought by Bain after Romney had taken leave to run the 2002 Olympics.
The Post’s article reported that several of the companies specialized in helping facilitate outsourcing for other corporations, as they reported in SEC filings.
Benjy Sarlin is a reporter for Talking Points Memo and co-writes the campaign blog, TPM2012. He previously reported for The Daily Beast/Newsweek as their Washington Correspondent and covered local politics for the New York Sun.