RomneyBain: The CEO and the SEC

HONESTLY, sometimes it just feels like piling on. For an avid political blogger, the last three weeks or so have provided political junkies and analysts, late-night comedians and the public at large a treasure trove of material on the presidential campaign of Willard M. Romney, a deep and apparently inexhaustible vein of revelations.

It’s like what you feel when you walk into an incredibly messy room: You don’t know where to begin.

What we’re witnessing from the Romney bid for the White House is a new kind of bad-dumb politics animated by a panoramic arrogance from the campaign and the candidate; an arrogance of great wealth and how to achieve it and keep it at all costs; and a denial of the very documents, or their applicability,  recording the process of that great wealth taking place.

The current descent of the Romney presidential campaign is lately the result of several news reports that deeply undercut the former Massachusetts governor’s claim to electability. They suggest that, contrary to February 1999 as the presumed bright line separating Bain-era and post-Bain-era Mitt Romney, he was still in charge at the company even when he wasn’t. Even when he told the U.S. Securities and Exchange Commission he wasn’t.

A growing body of evidence finds that he may not have been in the room, but he was very much in the loop.


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First there was the June 21st Washington Post story that reported Bain Capital outsourced jobs to foreign companies in India and China, “companies that were pioneers in the practice of shipping work from the United States to overseas call centers and factories making computer components, according to filings with the Securities and Exchange Commission.”

“While Bain was not the largest player in the outsourcing field, the private equity firm was involved early on, at a time when the departure of jobs from the United States was beginning to accelerate and new companies were emerging as handmaidens to this outflow of employment,” the Post reported.

Then Vanity Fair weighed in. Days ago, the magazine reported of Sankaty High Yield Asset Investors Ltd., a Bermuda-based concern described in securities filings as “a Bermuda corporation wholly owned by W. Mitt Romney.” “He set it up in 1997, then transferred it to his wife’s newly created blind trust on January 1, 2003, the day before he was inaugurated as Massachusetts’s governor.”

Though Romney said he left the firm in 1999, Vanity Fair reported, “Romney has continued to receive large payments from it—in early June he revealed more than $2 million in new Bain income. The firm today has at least 138 funds organized in the Cayman Islands, and Romney himself has personal interests in at least 12, worth as much as $30 million, hidden behind controversial confidentiality disclaimers.”

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LAST WEEK, a story by David Corn of Mother Jones found that Romney was part of an investment group that invested $75 million in Stericycle, a medical-waste disposal firm assailed by anti-abortion groups for disposing of aborted fetuses from family planning clinics.

Romney’s investment in that business, which could complicate his relationship with Republican values voters, was bad enough. But documents filed by Bain Capital and Stericycle with the Securities and Exchange Commission show Romney to have been active in the Stericycle investment long after his official exit from Bain in February 1999. “All of this undermines Bain's contention that Romney, though he maintained an ownership interest in the firm and its funds, had nothing to do with the firm's activities after February 1999,” Corn reported.

Next up: The Boston Globe, which reported on Thursday that, according to SEC records, Romney played an active role in Bain Capital affairs after 1999, when he said he left the company — contradicting what Romney wrote on reports filed with the SEC in 2000 and 2001. “Until 2002, when Romney and Bain Capital finalized a severance agreement, he remained the firm’s 'sole stockholder, chairman of the board, chief executive officer and president,' according to SEC documents. The description was applied even to the creation of five new Bain partnerships a full three years after Romney has said he relinquished all control,” the Globe reported.

Also on Thursday, Mother Jones reported that Bain Capital, under Romney’s control, was responsible for transferring American jobs to China as far back as August 1998 — conducting a form of business with foreign entities that predates the very word used in society to describe it: “outsourcing.”

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Anybody else? Oh yeah — on Current TV, Jennifer Granholm, host of "The War Room,” reported late Thursday that documents Current obtained from the Massachusetts State Ethics Commission, related to business entities and ownership, revealed that Romney had active participation in 11 Bain-related companies in 2002, long after his Olympian exit from Bain in early 1999.

It all suggests that while Romney may not have been in the boardroom where the Bain deals went down after his ostensible exit, Romney was present and accounted for just the same; his was the disembodied presence, the Voice of God on the conference call, the one with go/no go powers over Bain business dealings long after the call to Salt Lake City.

Stephanie Cutter, Obama deputy campaign manager, made things devastatingly clear in a Thursday conference call. “Either Mitt Romney, through his own words and his own signature, was misrepresenting his position at Bain to the SEC, which is a felony, or he was misrepresenting his position at Bain to the American people to avoid responsibility for some of the consequences of his investments.

“And if that’s the case, if he was lying to the American people, then that’s a real character and trust issue that the American people need to take very seriously.”

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ROMNEY DID himself no optical favors on Wednesday when he appeared before the NAACP convention in Houston. Making that obligatory stop on the campaign trail, Romney brought his economic tough-love message to an audience of African Americans, arousing boos from the crowd when he said he intended to shut down “every expensive non-essential program, and that includes Obamacare,” in a line that pandered to conservatives, and was as utterly dismissive of the value of the Affordable Care Act to those people right in front of him as it was rhetorically disrespectful of the president.



The fallout from this appearance was made worse with the subsequent disclosure by an NAACP official that the Romney campaign apparently sent its own cheering section of perhaps 20 conservative African Americans to Romney’s speech.

You gotta give Romney credit: When he went to this mountaintop, he brought his own amen corner with him.

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This morning on MSNBC, Michael Steele, former RNC chairman said this series of body blows to Team Romney would be “a problem until they get in front of it.” said. In this, Steele is completely wrong.

Fact is, it’s a problem that’ll be even more of a problem if Team Romney tries to get “in front of it,” only to realize what happens when you get in front of a moving train. The four or five recent reports are the Amtrak Acela of the candidate being defined by forces outside his campaign's control — the forces of the available public record — and that train’s long since left the station.

For the campaign to get in front of this would require undoing everything we already know about Romney — the nation's perception of the candidate and what he's told us — that’s already well-established. And it’s way too late for that.

This isn’t just campaign optics; this is way more crucial than telling the candidate to loosen his tie at rallies or roll his shirtsleeves up to the elbows. This is bedrock, core-conviction stuff. Either the candidate has it, or he doesn't.

And for his campaign ops, there's something that makes things even worse. The in-house story behind these reports is the one most potentially ruinous to the Romney campaign: the real possibility that some or many in the campaign’s brain trust are discovering these revelations themselves for the first time, at about the same time as the rest of us.

As Romney himself grapples with the situation, some in his campaign staff are almost certainly asking themselves: Did he really think nobody would do a little digging? How much of this did he plan to keep this a secret from us? How long did he plan to keep this a secret from us?

And some in that staff will ask themselves what more and more Americans are certainly wondering right about now: Do I trust him? Should I trust him?

And the fact that they’re both asking that question is internally corrosive for his staff and politically problematic for the Romney campaign, which will be hard pressed to spin its way out of this with a centrifuge.

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NOT THAT Team Romney won’t try. The pushback against the news reports has been both immediate and intense. Responding to the Boston Globe story, Romney campaign mouthpiece Andrea Saul doubled down on denial: “This article is not accurate. Gov. Romney left Bain Capital in 1999 ... and had no input on investments or management of companies after that point.”

Matt Rhoades, another Romney spokesperson, made with the outrage, protesting entirely too much. “President Obama ought to apologize for the out-of-control behavior of his staff, which demeans the office he holds,” he wrote in response to Cutter’s Thursday statement, calling it “reckless” and “unsubstantiated.”

All this righteous indignation doesn’t obscure or change the underlying assertions of the news reports, none of which have been disputed with contrary proof by Team Romney. And it doesn’t obscure the confidence that was already growing in the Obama campaign, a willingness to take the battle to Romney — to define a candidate who refuses to define himself. The Romney campaign’s crying foul at every opportunity reveals something that veteran political writer John Heilemann observed recently on MSNBC: “When they say ‘you’re playing politics,’ it usually means you’re playing politics well.”

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Image credits: Romney at Bain: Multiple immediate online sources; probable original source: Bain & Company. Vanity Fair logo: © 2012 Condé Nast Digital. Mother Jones logo: © 2012 Mother Jones. Boston Globe nameplate: © 2012 New York Times Company. Current TV logo: © 2012 Current TV.