NASHUA, N.H. — Mitt Romney’s Republican rivals accused him Monday of exaggerating his successes and coldly laying off thousands of workers while heading a profitable venture capital firm, an effort to turn the presidential front-runner’s biggest asset into a liability.
The heightened focus on the firm Bain Capital threatens to slow Romney’s cruise-control campaign because it goes to the heart of his No. 1 appeal to voters: the claim that he knows far more than President Barack Obama about creating jobs.
Romney’s takeover-and-restructuring firm “apparently looted the companies, left people unemployed and walked off with millions of dollars,” former House Speaker Newt Gingrich said on NBC’s “Today” show. A group friendly to Gingrich is airing TV ads of laid-off workers denouncing Romney, who interrupted his time at Bain to serve as Massachusetts governor.
Texas Gov. Rick Perry joined in. He cited South Carolina companies that Bain bought and downsized, and he practically dared Romney to ask for voters’ support there in the name of easing economic pain. “He caused it,” Perry said in Anderson, S.C.
Romney points to thousands of jobs created at companies that Bain bought, invested in or restructured. But he struck a discordant note Monday, just as attention to the Bain jobs history was spiking.
Speaking of insurance options before a New Hampshire audience, Romney said, “I like being able to fire people who provide services to me.”
He remained favored to win Tuesday’s New Hampshire primary. But his rivals might improve their hopes of halting his momentum in South Carolina’s Jan. 21 primary if they can persuade voters that his jobs legacy is not what he claims.
Thanks to millions of dollars from a Las Vegas casino owner who supports Gingrich, TV ads in South Carolina are trying to do just that. Like many attack ads they are emotional, one-sided and not subtle. They show angry victims of layoffs from Bain-controlled companies.
“We had to load up the U-Haul because we done lost our home,” a woman says.
On the campaign trail, Romney rarely mentions his four years as governor unless asked. But he constantly touts his time in the private sector, asking voters to trust his instincts and experience in creating jobs.
The claims rely on Romney’s career at Bain, a Boston-based private equity firm that poured investors’ money, and Bain executives’ expertise, into more than 100 companies in the 1980s and ‘90s. Some of the companies thrived and expanded. Some took on unsustainable debt and went bankrupt. Some became leaner or were broken into various parts, shedding jobs and improving profits.
In a recent debate, Romney repeated his claim that the Bain-run companies netted a total increase of 100,000 jobs.
Studies by The Associated Press and other news organizations conclude that the claim doesn’t withstand scrutiny. That alone, however, hardly suggests Romney was an unsuccessful business executive. He became wealthy, a hero to many entrepreneurs, and the leader of the much-praised 2002 Winter Olympics.
The 100,000 jobs claim comes from activities at only three companies, all of them successes: Staples, Domino’s and Sports Authority. However, it counts many jobs that were created after Romney left Bain in 1999. And it ignores job losses at many other firms that Bain invested in or took over.
The Wall Street Journal, which examined 77 businesses that Bain invested in during Romney’s tenure, concluded Monday that the record is mixed. Twenty-two percent of the companies closed down or filed for bankruptcy reorganization within eight years, “sometimes with substantial job losses,” the Journal reported.
“Bain produced stellar returns for its investors,” the paper reported. But 70 percent of the profits came from 10 deals.
A separate AP analysis found that at least 4,000 workers lost their jobs at 45 companies bought by Bain between 1984 and 1994, according to company reports, news releases and news coverage. The tally probably is higher, because it does not include other jobs lost in bankruptcies and other store and factory closings.
Like any venture capital company, Bain’s main purpose was to generate profits for investors, not to create jobs. So it is easy for political campaigns to find dazzling success stories and heartbreaking plant closures in the company’s history.
A new 28-minute film, “King of Bain,” portrays Romney as a profit-driven predator. A pro-Gingrich super PAC bought the film and is using excerpts for the attack ads in South Carolina. The group says it will post the entire film online.
Gingrich’s struggling campaign has been helped by $5 million given to the super PAC by casino owner Sheldon Adelson.
Obama’s campaign aides have long considered the Bain record to be Romney’s weakest spot, more damaging than his much-discussed flips on abortion and other issues.
Romney told reporters Monday in New Hampshire that the attacks from Gingrich and Perry surprised him.
“Free enterprise will be on trial” in the 2012 election, Romney said. “I thought it was going to come from the president, from the Democrats, from the left. But instead it’s coming from Speaker Gingrich and apparently others, and that’s just part of the process. I’m not worried about that.”
Romney’s record at Bain has both helped and hurt his political career for nearly two decades. Bain was a pioneer in the often lucrative practice of “leveraged buyouts,” which involve heavy borrowing against the assets of a just-purchased company, and sometimes aggressive restructuring. Romney’s role there is generally lauded in corporate circles.
But in his unsuccessful 1994 Senate bid, Democrats ran ads featuring a worker who lost his job after Bain bought and restructured American Pad & Paper.
According to The Wall Street Journal, the deal generated $102 million in investment gains. But Ampad filed for bankruptcy protection in 2000.
Associated Press writers Stephen Braun in Washington and Brian Bakst in South Carolina contributed to this report.