So during the Republican presidential candidate nomination for the 2012 election there have been many front-runners: Herman Cain, Michele Bachmann, Donald Trump, Sarah Palin, Newt Gingrich, and now, apparently, Rick Santorum. However the one static candidate has been Mitt Romney. Romney has many of the qualities Republicans like in a leader: former governor of a state (Massachusetts), private sector business experience, and he has run for president before. It seems as though it’s his turn to be the Republican nominee.
Still, many people don’t like Romney. They don’t trust him. One of the recent rallying cries from the media is about the 3/4 of Republicans who do not and cannot vote for Mitt Romney; call it the “we are the 75%.”
There has been a lot of rancor among his fellow nominees, specifically Gingrich, another former light in the dark, Rick Perry, Ron Paul, and Santorum. One sticking point of record for folks with Romney is the work he did in the private sector. Romney worked for Bain Capital.
To hear Romney tell it Bain was a great place to work. He and Bain partnered together to help turn businesses around and save American jobs, and to hear him tell it he even saved the 2002 Salt Lake City Olympics.
But to hear others tell it, Romney’s work at Bain Capital was nothing short of savage. According to Mass Resistance, Romney’s involvement with Bain Capital in 1992 was particularly ruthless.
The piece from Mass Resistance goes on to say that Romney and Bain bought the company American Pad & Paper Co. (Ampad) for $5 million. “Over the next several years Romney’s firm bled the company dry. Hundreds of workers lost their jobs. Stockholders were left with worthless shares. Creditors and vendors were paid less than 50 cents on the dollar. While they were exploiting the company, Romney’s firm charged Ampad millions of dollars in ‘management fees.’” If that sounds like the perils of big business it is something we should know about the man who may become our president.
To get it even sharper, in 2007 the Boston Globe reported that Bain bought Ampad for $5 million dollars but took this time to buy up similar companies to Ampad in the same industry. This is what is known in private equity as a “roll-up strategy.” So Ampad borrowed on their name and took out loans which by 1999 had totaled “nearly $400 million.”
That means this tiny company which Bain had bought for $5 million bucks borrowed 80 times that amount so Bain could try to turn this business around. Bain didn’t turn this business around. The result? Ampad filed for bankruptcy, people lost their jobs and the taxpayers footed the bill. (But not before paying Bain a reported $60 million dollars).
Of course this was “Bain Capital” but at the time of the accusation of Ampad Mitt Romney was head of this private equity firm. Mitt’s success from deals like Ampad and others went on to help make Mitt the wealthy man that he is today.
It’s just something worth knowing.
Sources:
http://www.massresistance.org/romney/ampad_062607/index.html