Romney Bain and South Carolina
Before we jump to any hasty
conclusions and draw our money out of the betting pool we can still pretty much
rest assured that Willard Mitt Romney will capture the Republication nomination
for the Presidential election this year.
Yes. Yes. Respectfully graying at the temples Mitt will
take that podium in Tampa Bay in August (better him than me) and wax
philosophical as to exactly what a great guy he is.
But he lost! I hear you say. But he lost!
Yes. He lost. But look where he lost. In South Carolina of all places. What exactly did you expect? Sure the fair governor of South Carolina
endorsed him. But again, what did you
expect? The right honorable Nikki Haley is
a political hack who like to play with a fixed deck. More than just a bit of a racist,
demonstrated by standing behind initiatives such as requiring voters to show
their IDs at South Carolina voting polls, she hooks her star to the perceived
winner regardless of how that purported winner has screwed her state.
And screw South Carolina Romney most
certainly did. While working at Bain
& Company he helped form spinoff capital investment firm Bain Capital LLC.
Bain Capital LLC more than doubled its
money on GS Industries Inc., the former
parent company of Georgetown Steel. The
steel manufacturer went on to cut more than 1,750 jobs, shuttered a division
that had been around for 100 years and eventually sank into bankruptcy. Less than a year after taking a controlling
interest in the Georgetown plant, Bain Capital cut the employees'
profit-sharing plan twice - lowering the plan's hourly rate from $5.60 an hour
to $1.25 per hour. Most of the workers didn't learn about the cuts until they
received their paychecks. The profit-sharing checks eventually disappeared altogether.
Let’s recount the story of the Holson Burnes Group, a photo-album
maker based in Gaffney South Carolina. The prospectus shows Bain Capital's
partners made more than twice their investment, earning $22.6 million,
according to the prospectus, between 1986 and 1992, when Holson Burnes Group
went out of business and 150 people lost their jobs. Holson Burnes then
proceeded to open and
shut a plant in South Carolina and to do the same in New Hampshire.
Each time, it created, then cut, jobs. In South Carolina, at least, it cut
those jobs after having extracted big incentives from the government to open
the plant. For Bain, the plan was a financial success: Holson Burnes raised $
24 million from its initial public offering on the over-the-counter trading
market, with Bain executives retaining the majority of the company’s shares.
Bain, in the end, reaped more than double the return on its initial investment.
But workers were left jobless just as the local economy began to slump.
To create ever-more profit for Bain, Holson Burnes shipped jobs overseas. By 1992, the company manufactured nearly 75
percent of its photo frames overseas, according to documents filed with the
Securities and Exchange Commission. One of the company’s clock-making divisions
also shipped work overseas from a Rhode Island plant.
So do you think the good people of
South Carolina are stupid? Hmm. Never mind.
While they tossed Romney to the wolves, as well they should have, who
did they tap as their boy? Family values
man, Newt Gingrich.
In his victory speech, Gingrich was
a riot. Explaining his appeal to those
eligible South Carolina voters he advised, "It's that I articulate the
deepest-held values of the American people.” Now that’s entertainment.
Newt is another story. The nerve of this guy even showing his naked
face in public. Incredible.
But, let’s take a closer look at
this South Carolina primary. Seems that
of the 600,000 people that voted (of the 2.8 million registered voters of the
state), about 167,000 of them voted for Romney anyway. Santorum and Paul trailed behind in third and
fourth respectively. Newt took about 40%
of the vote where Romney took close to 28%.
No question that Romney fell on his face. But when you consider that 8.6% of the voting
public selected Newt and 6% of the voting public went for Romney, the spread
wasn’t all that impressive.
By all accounts, what should have
happened, is the people of South Carolina should have run Romney tarred and
feathered through the streets of Charleston.
Instead, he came in a more or less respectable second.
So does this mean that Mitt should
dig a hole and disappear from the rest of the campaign? Hardly.
He lost where he should have lost.
He’ll gain it all back quickly.
Santorum will eventually have to bow out. The fun part will revolve around the point
where Ron Paul will decide to go independent and draw votes away from the
Republicans. Much like on the Democratic
side when Ralph Nader did the same to Al Gore.
At this point, Obama’s people will
definitely ramp up the rip and tear attack dog tactics. We’ll start to see that soon. But assuming Obama goes on the attack big
time, he won’t have much to worry about in November.
posted by Marty Brounstein @ 12:49 PM
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