Snap Fact #242 - President Obama has fought for American Jobs Creation, While Governor Romney Pioneered Job Outsourcing!

Post date: Jul 10, 2012 9:33:36 PM

Snap Fact #242

President Obama has fought for American Jobs Creation, While Governor Romney Pioneered Job Outsourcing!


President Obama's opponent Mitt Romney is also campaigning on job creation, but he has no announced specific jobs plan as the President does. He claims that the economy would prosper by giving increased tax cuts to the wealthy, decreasing the corporate tax rate, getting rid of what he calls “job suffocating regulations”, and overturning "ObamaCare." Romney's 'Trickle-down Theory' has been tried before during the Bush Administration and brought the US to the brink of a Depression. 

More recently, the same austerity based financial policies have been the guiding economic principle in Europe; and that has led directly to a severe downturn in that region’s economy, perhaps putting them again on the very edge of a complete fiscal breakdown. If we measure America’s mild yet sustained growth under President Obama (even forgetting that it would have been more robust if Republicans hadn’t thrown a monkey wrench into Obama’s plans) against the European and Chinese downturns, we can deduce that our growth has been wild, not mild, in the context of global economic reality. 

Governor Romney has repeatedly touted that his experience at Bain as a job creator jobs qualifies him to be President. Since he has put his corporate experience out there as a primary argument for his election, examination of his experience, and his results are fair game. 

His record includes not only U.S. job losses at companies Bain took over; but it includes U.S. jobs lost thru Bain's investment in companies that pioneered and expanded the practice of shipping U.S. jobs to new facilities overseas. The fact is that on balance, the losses of both activities far outweigh the few thousand American jobs created by Bain while Mr. Romney was active. 

A Washington Post investigation, published on June 21, 2012 was an examination of securities filings by Bain. It shows the full extent of Bain’s investment in firms that specialized in helping other companies move or expand operations overseas during Romney's 15 year tenure at Bain costing Americans a huge number of jobs. 

"While economists debate whether the massive outsourcing of American jobs over the last generation was inevitable, Romney in recent months has lamented the toll it's taken on the U.S. economy. He has repeatedly pledged he would protect American employment by getting tough on China . . ." However, at Bain he gave prominent companies venture capital for growth while at the same time giving them strategic management advice on keeping their bottom line down thru outsourcing of American jobs. 

The Washington Post article concludes, "Mitt Romney’s financial company, Bain Capital, invested in a series of firms that specialized in relocating jobs done by American workers to new facilities in low-wage countries like China and India . . . 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 article continues, "During the nearly 15 years that Romney was actively involved in running Bain, a private equity firm that he founded, it owned 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 … Bain’s foray into outsourcing began in 1993 when the private equity firm took a stake in Corporate Software Inc., or CSI, after helping to finance a $93 million buyout of the firm. CSI, which catered to technology companies like Microsoft, provided a range of services including outsourcing of customer support. Initially, CSI employed U.S. workers to provide these services but by the mid-1990s was setting up call centers outside the country . . . Bain played several roles in helping these outsourcing companies, such as investing venture capital so they could grow and providing management and strategic business advice as they navigated this rapidly developing field . . . ." 

The Washington Post article gives a chronology of the companies that Bain invested in and worked with that promoted outsourcing of American jobs. So it is nakedly hypocritical of Romney to complain about loss of U.S. jobs due to outsourcing, when while he was at Bain, Romney conducted himself in a manner that promoted and accelerated the process of outsourcing U.S. jobs. Although this made money for himself, his investors and the companies that he assisted it is hardly to be ignored when evaluating the policies, the philosophy, as well as the character of a man who so facilely rewrites history. True, that his job was to make money for Bain and associates, it is also true that during his tenure at Bain he never once considered the effect his efforts would have on the American worker and the U.S. economy. 

Even some his own team recognizes this but most of them are too timid to say it out loud. Here is one example of Republicans who have formed Republicans For Obama and opposed Romney’s position. "People like Romney equate economic success with the success of companies, not the success of individuals. A Romney Presidency won't care about whether the median income is going up, or the ability of regular Joes to improve their lot in life. For Romney, if companies are doing well, then the economy is doing well. Period.That's the danger of having this guy in office. . . ." 

The Romney campaign's response to the Washington Post article is that 'outsourcing does not equal offshoring,' is a confusing semantic argument that does not begin to address Bain's documented record of outsourcing American jobs to low wage countries. Politico opines, " . . . At heart, the Romney camp’s argument is about vocabulary: “outsourcing” does not technically have to mean sending jobs to foreign countries (that’s “offshoring”), rather than simply having an external company perform a function that could have been performed in-house . . . The Romney campaign’s on-record response doesn’t address Post reporter Tom Hamburger’s lengthy documentation of Bain’s involvement in foreign companies and companies that created jobs outside the United States, including Corporate Software Inc., Modus Media, GT Bicycle Inc., SMTC Corp. and Hyundai Electronics Industry. The difference between moving U.S. jobs overseas and creating jobs at foreign facilities, rather than American ones, is a potentially important political distinction. Some of those firms were more directly involved in setting up foreign manufacturing and service operations than others . . ." 

Responding to the Washington Post article, President Obama has soundly criticized Governor Romney's record of outsourcing jobs while at Bain, stating that Romney is "not the Pioneer we need in the White House”. He stated: "We need a president who will fight for American jobs."