I realize this may devolve into a debate, but for now I’m really just interested in the actual numbers that would answer this question:
During Mitt Romney’s tenure as head of Bain Capital, were more jobs created or lost/destroyed by their actions in taking over/investing in companies?
Impossible to measure unless you propose a metric. US jobs only? Net employees of all companies from date of acquisition until date of sale (or today)?
Obviously, from a US Presidential election standpoint, US jobs only.
Until date of sale, since if we count till today, lots may have happened that is outside the control of Bain
US jobs only.
Net employees from date of acquisition until date of sale, or until Romney’s last day as head of Bain Capital, whichever came first.
Bain heavily contributed to the practice of anti-competitive consolidation which has eliminated millions of jobs. They were corporate raiders and their mission was simply to purchase companies, fire employees, close down entire operations, and sell the results as more profitable companies.
I’m going to say that since Bain is a private equity firm and it’s financial information along with it’s portfolio companies are privately held, that such information in its totality for the years 1984-1999, is not going to be publicly available. One might be able to find the portfolio companies that were subsequently IPO’s and piece some of the info. together. But I would doubt the accuaracy of anyone outside the firm compiling such information.
I’m with Omar - given the metric specified I doubt we have enough publicly available data to say. Many of the companies wouldn’t have disclosed that. I’m not sure we can even get a comprehensive list of companies Bain bought and sold.
Thisfactcheck.org article (about a tangentially related Sununu claim) includes the following quote:
It goes on to provide at least one study:
That is factually incorrect.
Their mission was to make money for their investors. Sometimes that involved closing companies (most of which were already failing, which is why Bain entered in the first place). However, most of the companies they purchased were not closed down.
I’ll quote the one portion of that link that supports what John Mace said:
“Again, it isn’t that the facts of the attack ads are wrong, it’s that the companies are some of the worst performers in the Bain portfolio, which includes many more success stories.”
That doesn’t say what he claims it says. It just says there were success stories along with the bad. That doesn’t illustrate anything about their mission, nor say anything that proves TriPolar’s claims incorrect.
Not many answers so far, but what I’m getting out of it is that there’s no way to really evaluate Romney’s claim that he knows how to create jobs, at least not by going on his past record (because there isn’t one which we can examine).
Economists (including Moody’s Analytics) say that 12 million new jobs will be created in the US by 2016 no matter who is President.
So is Mitt’s plan basically just to be President and then take credit for the jobs created during his term?
If it is, why isn’t Obama just saying that he will create 12 million new jobs by 2016, since it’s going to happen anyway?
Really?
Perhaps you should re-read it. And if TriPolar wants to support of any his assertions, he is welcome to do so. As it stands, he is factually incorrect.
And what about the thousands of unfortunate people who had a job in the ice box manufacturing factories when those dawn refrigerators came into the market? What about all the poor telephone operators who lost their jobs when technology took them over? And the typewriter companies that went bankrupt when they were put out of business by the computer? Thousands were put out of work!
Bain and others like them go into into companies that are failing because they are not keeping up with technology and try to turn them around. If people are working in a dying industry, the best thing for them is to get out of it and get retrained or start their own business. Do you really think that Bain went into healthy, profitable companies and shut them down? Those businesses were going down the tube anyway. Was Bain successful all the time in turning the companies around and saving all the jobs? Of course not, but in many cases they were and many people were saved from losing their jobs.
The tricky part of this question is that you need to compare the jobs that were actually gained or lost (relatively straightforward) with the jobs that would have been gained or lost, had Bain not gotten involved (nigh-impossible).
Bain consolidated companies. The only purpose of that was to increase the profitability of one company at the cost of it’s employees, and to eliminate competition. One of the big criticism of Bain was that it didn’t put profits back into development within the companies and instead disbursed them as dividends. This has nothing to do with improving technology, quite the opposite instead.
You have a lot of opinions on this subject and are flinging some pretty wild accusations. Since we are discussing factual answers in this forum, you need to back them up with credible cites. Credible means not some editorial or some news analysis.
The first thing I should do is learn to look at what forum the thread is in. You’re quite right, I wasn’t using GQ appropriate language. For a start, here’s the wiki articleciting the failure to reinvest profits from The Buyout of America: How Private Equity Is Destroying Jobs and Killing the American Economy by Josh Kosman.
OK. I was surprised that you seemed to posting IMHO or GD type posts in GQ.
Who is Josh Kosman and what makes him an objective observer of Bain?
I have no experience with Bain, but I had a good view of the equity capital game.
I spent 15 years with a successful private company that was acquired by an equity capital group. They then acquired three more firms, each with mature products with a good revenue stream. Each time; they reduced staff by about 30%, took out large loans to finance the next acquisition and pay dividends in measured in $100’s of millions to the investors.
They are smaller as measured by staff levels, profitable and have over a billion dollars in loans. (having started with two private, debt free companies)
(I was in management and saw the layoffs directly for the first two cycles and just read about the loans in the financial press.)
Here’s what he says about himself. I don’t know otherwise. That echoes the same information from sources I don’t recall, perhaps it was just him on television.