The Facts
The Obama campaign pointed us to a series of SEC filings and news accounts showing that three companies within Bain Capital’s portfolio sent jobs overseas. Romney served as chief executive of the firm, which specialized in private-equity investment and leveraged buyouts during his tenure there. He left the company in February 1999 to become president and chief executive of the committee that organized the 2002 Olympics in Salt Lake City.
One example of outsourcing came from the Holson Burns Group, a manufacturer of photo albums and picture frames. The company opened and then closed several new U.S. plants before outsourcing most of its production to the Far East by 1993, six years after Bain took control of the business.
The Obama campaign also mentioned Canadian electronics maker SMTC Manufacturing, which announced in March 2001 that it planned to move one of its production operations, then located in Denver, to Chihuahua, Mexico.
A third company, Modus Media, announced in June 2000 that it would open a plant in Guadalajara, Mexico after cutting 200 jobs from a plant in Fremont, Calif.
Notice a problem with the last two examples? The outsourcing occurred in 2000 and 2001. Romney left Bain in early 1999.
We’ve gone over this problem with the Obama campaign before, awarding three Pinocchios to a January memo the team released blaming Romney for job losses and bad deals that took place after the former executive had stopped working for Bain.
We discovered that Romney’s name appeared on Bain SEC filings between 1999 and 2002. But a 2002 statement the former executive filed with the Massachusetts State Ethics Commission said he was a “passive, limited partner [with] no management capacity” in the Bain entities in which he held ownership.
We also learned that the creditors who sued some of Bain’s companies and executives over dividend payments around the time in question did not name Romney in their lawsuit. Plaintiffs generally try to list as many people as possible as defendants to encourage settlement, so it’s highly unlikely that Romney had any involvement with Bain’s businesses during this period.
These facts essentially exonerate Romney from allegations that he was responsible for any outsourcing, bad deals and layoffs that occurred with Bain’s companies in the early 2000s. (Note: it may make a difference if the initial investment took place while Romney was actively running Bain Capital, but that is not the case here.) So that leaves just one possible example of outsourcing out of scores of investments made by Bain under Romney’s leadership.
