Mitt Romney as job creator clashes with Bain record of job cuts

By Lisa Lerer

Bloomberg News

Published: Wednesday, July 20 2011 10:57 a.m. MDT

WASHINGTON — Republican presidential candidate Mitt Romney's campaign misses few opportunities to promote his record creating jobs, including his role in taking Staples Inc. from a start-up to the world's largest office-supply retailer.

"You'd have a president who has spent his life in business small business, big business and who knows something about how jobs are created and how we compete around the world," he said at a campaign stop last month at Buddy Brew Coffee in Tampa, Fla.

What Romney skips is his experience in eliminating jobs. It's a facet of his career that presents a particular challenge for the Republican primary frontrunner: Tough business decisions don't necessarily translate into good politics.

As head of private equity firm Bain Capital, Romney was the lead deal-maker, buying and selling companies to make money for investors. Whether companies boomed or filed for bankruptcy, the Boston-based firm found profits for Romney, its other executives and investors. Romney, who spent most of his career at Bain, estimated his wealth in 2007 at as much as $250 million. He has yet to update his financial status for the 2012 presidential campaign.

Entrepreneurs and corporate founders "create the bulk of the jobs, not the financiers," said Marc Wolpow, a former Bain managing director who left in 1999 and is now co-chief executive officer of Audax Group, which manages more than $4.8 billion.

"That is not necessarily a good political story for a candidate with a buyout background," said Wolpow, a Democrat- leaning independent who said he would consider backing Romney in 2012.

At Dade Behring Inc., a medical-testing company based in Deerfield, Ill., Bain cut at least 1,600 jobs during a series of acquisitions before the firm entered into bankruptcy in 2002. Romney foreshadowed those cuts in a speech to employees shortly after Bain acquired the firm.

DDi Corp., an electronics company in Anaheim, Calif., filed for bankruptcy in 2003 after Bain sold shares in the company generating at least $85.5 million and billed $10 million in management fees.

GS Industries Inc., a steel company in Charlotte, N.C., filed for bankruptcy in 2001 after workers said a chief executive hired under Bain made missteps, including installing managers who lacked industry expertise, former employees said.

Employees who lost jobs at Bain-controlled companies more than a decade ago say they still hold Romney responsible.

"I would not vote for him for anything," said Phyllis Detro, 68, who lost her job at a Bain-owned office paper products factory in Marion, Ind., closed in 1995. "I'd like to see the jobs that he's created. He has taken away jobs."

In a presidential campaign becoming a referendum on jobs as the economy struggles with a 9.2 percent unemployment rate, Romney's private sector credentials are coming under scrutiny.

A video played when Republican Jon Huntsman Jr. announced his presidential candidacy in New Jersey on June 21 said Huntsman "built things, built jobs -- didn't just buy them." Huntsman is a former Utah governor and executive at Huntsman Corp., a chemical company that started as his family's business in 1970.

Huntsman is following a script written at the start of Romney's political career. In a 1994 race against the late Sen. Edward Kennedy, D-Mass., Romney was trumpeting his business credentials and leading in the polls -- until Kennedy's campaign turned the spotlight on Bain-backed job cuts at an American Pad & Paper, or Ampad, factory in Indiana that was closed in 1995. Romney went on to win election as governor of Massachusetts, serving from 2003 to 2007.

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