Wolraich: Obama at the Gates of... Gates
Dr. C: In Praise of Writing Binges
Maiello: Gatsby Doesn't Grate
The story about Romney's investment in the Chinese firm—Global-Tech Appliances—IN 1998 has so many legs it might become the nexus-centipede of Bain, Romney, Outsourcing, China, Telling Lies, and the flawed Republican presidential campaign of 2012.
Heretofore Romney has been able to muddy the record on his direct involvement in outsourcing because some previous outsourcing claims were fudged by the question of whether Romney was still at Bain Capital during the period 1999-2002. The "story" that Romney was not involved in Bain during that period is unraveling by virtue of SEC filings in which he claimed to be Sole Owner, Chairman and CEO of Bain, and also by testimony to the Massachusetts Ballot Commission that his full intention was to return to Bain—the latter rationale he absolutely needed to qualify for a run at the Governorship. Despite facts to the contrary, the story of "how" involved he was can be one of those never ending run-abouts. But the story about Global-Tech is much more damning to Romney than a debate about how connected to Bain he was in the 1999-2002 time period.
According to the Mother Jones article, Romney invested in Global-Tech in 1998, well before he left Bain, and Massachusetts, to live in Utah and run the Olympics. Romney invested through an entity named Brookside Capital Partners Fund, wholly owned by Romney. Mother Jones estimates the investment could be in the range of $14 million—which Romney's campaign yesterday, after a long silence, described as a small amount. Their calculation was based upon an SEC filing that Brookside upped its investment in Global-Tech in the form of participation in an IPO, the price per share being set at $19 per share.
What's damning about Romney's participation in Global-Tech is that the entire business plan was founded on the strategy of moving jobs from the U.S. from companies such as Coffee Mate and Sunbeam to achieve lower production costs with the intent of shipping traditional products back to the U.S.
The research and relevance of the Global-Tech investment is in its infancy. As Spitzer pointed out, there is undoubtedly a body of evidence of how Bain promoted this investment to U.S. investors in Bain—for example, pension funds—in what was then pretty much a novel situation, a company specifically set up in China to close production in the U.S. and shift jobs to China. A company Romney thought was an excellent opportunity.
This story is very specific with regard to Romney's pioneering role in outsourcing. It can't be fudged by how involved Romney was at Bain during the Olympics period.
In general I think the noose of his tax returns is slowly closing on Romney. One of the revelations yesterday was that Romney was receiving at least $100K a year from Bain during the period of the Olympics. But how much? Only a tax return would show that. And how much money did Romney net from his direct investments in companies whose purpose was to gut the U.S. plants in the hard core of U.S. manufacturing. Again, tax returns. And oh, by the way, what specific plants were involved, and aren't there employees out there who had to train Chinese counterparts in how to make coffee machines—like the guy who built the stage from which Romney's men announced the closure of the plant—and then were let go and dumped upon the pile of the unemployed? I'm sure by now Mother Jones is in touch with the specific people and plants who were sucked into Romney tax returns as a foot note. As a last rite of respect for those who were outsourced, the footnotes need to be made public.