Monday, July 2, 2012

Romney’s new Bain problem


FOR MUCH of this presidential campaign, Mitt Romney has been joined at the hip with Bain Capital, the private-equity concern he founded in 1984. To this point, the Romney/Bain relationship has resulted in disclosures that have called into question his role as a job creator (given Bain Capital’s role in larding various companies with debt, strip-mining those companies’ assets and then shutting the companies down, idling thousands of loyal workers — and, more recently we've discovered, outsourcing jobs to overseas locations).

That's been bad enough for Romney as a campaign issue. Now, though, Romney’s ties to Bain have taken a more unsavory and politically problematic turn. A new and potentially explosive story by David Corn of Mother Jones examines a business, and Romney’s investment in that business, that could deeply complicate the former Massachusetts governor’s relationship with values voters in the Republican base he needs to be competitive in November.

Isolated excerpts of Corn’s story don’t do it proper justice; it deserves to be digested at length and intact:

Earlier this year, Mitt Romney nearly landed in a politically perilous controversy when the Huffington Post reported that in 1999 the GOP presidential candidate had been part of an investment group that invested $75 million in Stericycle, a medical-waste disposal firm that has been attacked by anti-abortion groups for disposing aborted fetuses collected from family planning clinics. Coming during the heat of the GOP primaries, as Romney tried to sell South Carolina Republicans on his pro-life bona fides, the revelation had the potential to damage the candidate's reputation among values voters already suspicious of his shifting position on abortion.

But documents filed by Bain and Stericycle with the Securities and Exchange Commission—and obtained by Mother Jones—list Romney as an active participant in the investment. And this deal helped Stericycle, a company with a poor safety record, grow, while yielding tens of millions of dollars in profits for Romney and his partners. The documents—one of which was signed by Romney—also contradict the official account of Romney's exit from Bain.

In November 1999, Bain Capital and Madison Dearborn Partners, a Chicago-based private equity firm, filed with the SEC a Schedule 13D, which lists owners of publicly traded companies, noting that they had jointly purchased $75 million worth of shares in Stericycle. ...



The document also states that Romney "may be deemed to share voting and dispositive power with respect to" 2,116,588 shares of common stock in Stericycle "in his capacity as sole shareholder" of the Bain entities that invested in the company. That was about 11 percent of the outstanding shares of common stock.

Another SEC document filed November 30, 1999, by Stericycle also names Romney as an individual who holds "voting and dispositive power" with respect to the stock owned by Bain. If Romney had fully retired from the private equity firm he founded, why would he be the only Bain executive named as the person in control of this large amount of Stericycle stock? ...

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. The Stericycle deal may raise red flags for anti-abortion activists. But it also raises questions about the true timing of Romney's departure from Bain and casts doubt on claims by the company and the Romney campaign that he had nothing to do with Bain business after February 1999.


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THERE ARE some oppo-bashing opportunities that you just can’t take advantage of, and for the Democratic Party and Team Obama, this is one of them. With a topic this existentially, fundamentally sad, there are few good options for its exploitation by the Obama re-election forces. It goes without saying that the details of Corn’s reporting won’t find their way into an Obama campaign ad. Period.

Everyday voices in the blogosphere seem to grasp this, even as they acknowledge that the story’s underlying bedrock contention — Romney lied about the duration of his ties to Bain Capital — is powerful enough to arouse doubt in the minds of Romney backers whose support of the candidate is spongy enough already.

Dricey at The Daily Kos: “I can't think of any decent way to frame this as an ad. It's a tragic and sad subject, regardless. But as a news story, it's pretty damaging to Romney. As is obvious, he lied about it. Of course, he'd lie about the Law of Gravity, too, if there was a buck, or a vote, in it. But this isn't just any lie. ... He lied about investing in fetus-disposal, after all, and about making skazillions of dollars off of it. In the Right's eyes, this is like lying about being involved in disposing of the dead at a death camp. So I think this isn't something that they can easily overlook. If it makes it into the media narrative over the next couple of weeks, it won't be something the Right can just consign to the Memory Hole.”

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SO FAR, it’s been scarcely covered as a news story in the mainstream media; Lawrence O’Donnell blew it up electronically on his MSNBC program “The Last Word” on Monday. Since then, it’s been bubbling online, on the blogs and magazine Web sites, but nowhere else at this writing. It’s as if mainstream media knows this story is almost as radioactive to cover as it is for Romney to refute.

Maybe the MSM hopes to come at the medical-waste issue tangentially, piggy-backing it on top of the already established media revelations over Romney’s involvement with Bain and his previous flip-flops on the abortion issue. Since it goes to candidate character, this latest reveal about the Bain of Romney's existence needs to be pursued — even if, strictly speaking, it probably isn’t necessary to drill down overmuch into the particulars of this latest disclosure. Vis-à-vis Romney and Bain Capital, there’s already enough there there to keep the media, the blogosphere and the public at large occupied from now until November 6.


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But the Republican base may not be so accommodating. Romney is a candidate whose relationship with the most severely conservative members of that base — already skittish about the Mormon former-moderate governor irrevocably tied to a health-care law they revile — has just been complicated. By orders of magnitude.

“This is a real morale sapper for the right,” observed TheBigotBasher at Daily Kos. “This undermines the very base of the Romney campaign. The GOP spent the last two years ignoring the economy so they could conduct a war on women. They then select a candidate that profits from disposing of aborted fetuses.”

 “The Evangelicals want absolute purity,” said Norm in Chicago, writing at Daily Kos. “The argument that Romney should be allowed to profit off Planned Parenthood and abortion just because he is a Republican isn't going to fly. Romney cannot claim to have impecible [sic] pro-life credentials and profit off Planned Parenthood at the same time.”

Image credits: Romney: Via ThinkProgress. Stericycle truck: Scarce via Daily Kos.

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