“This is a story of greed, of playing the system for a quick buck, a group of corporate raiders led by Mitt Romney more ruthless than Wall Street. For tens of thousands of Americans, the suffering began when Mitt Romney came to town.”
– Voice-over from “King of Bain” video promoted by a pro-Newt Gingrich super PAC, Winning Our Future.
Newt Gingrich, meet Michael Moore!
The 29-minute video “King of Bain” (trailer above, full video here) is such an over-the-top assault on former Massachusetts Gov. Mitt Romney that it is hard to know where to begin. It uses evocative footage from distraught middle-class Americans who allege that Romney’s deal-making is responsible for their woes. It mixes images of closed factories and shuttered shops with video clips of Romney, making him look foolish, vain or greedy. And it has a sneering voice-over that seeks to push every anti-Wall Street button possible.
Let’s take a look at some of the claims in “King of Bain.”
3:17 mark, the closure of the UniMac plant in Marianna, Fla.
In the film, three former employees of UniMac, which makes commercial washing machines, appear to suggest that quality went down under Bain Capital’s management and that a plant in Marianna, Fla., was closed because of Romney’s actions.
But the chronology is all jumbled. Bain Capital bought the business from Raytheon in 1998, and Romney left Bain a year later to run the Winter Olympics in Salt Lake City. In 2005, Bain sold UniMac (also called Alliance Laundry) to a Canadian entity known as Teachers’ Private Capital. The factory was moved from Marianna to Ripon, Wis., in 2006, after Bain’s involvement ended, a fact made clear on the website of a laundry repair business co-owned by the people featured in the film.
In fact, Mike Baxley, who was interviewed for the film, said that he and his partner had “absolutely no idea” that the interviews were for a film about Romney and Bain. He said they thought they were being interviewed for a documentary about the factory closing. “They said they wanted to know what it was like when the factory closed down,” he said, and he, his partner and his partner’s wife agreed to interviews after “they flashed a little money at us.”
After watching “King of Bain,” he said: “We were pretty shocked. Our quotes were seriously taken out of context. There is a real lack of facts.”
Indeed, Baxley, Tommy Jones and Tammy Jones barely mention Romney and Bain as they talk about their angst about the factory closing. The narrator of the film inserts suggestions that Romney was responsible.
8:00 mark, bankruptcy of KB Toys
Here again, the chronology is off. Bain Capital did not buy KB Toys until late 2000, more than a year after Romney left for the Olympics. But the film states, “Romney and Bain bought the 80-year-old company in 2000, loaded it with millions in debt.” It then attributes the failure of KB Toys in 2008 to that debt load, without noting that a horrible retail environment wiped out a number of chains, particularly toy stores. Then the film runs a snippet from a 2010 Romney appearance at Emory University, making it appear as though he is talking about KB Toys when he speaks of “creative destruction.” (This is not a phrase coined by Romney, but an economic term referring to the creation of new technologies.) The film does not include the rest of Romney’s remarks on the importance of helping people transition from jobs in outmoded industries to new ones.
10:10 mark, the bankruptcy of DDi
The segment tries to tie Romney to Wall Street game-playing by focusing on allegations that Lehman Brothers pumped up the stock of DDi, allowing Bain Capital to sell its shares for big gains, even while a Lehman analyst had misgivings about the Orange County electronics maker.
According to an Aug. 26, 2003, account in the Orange County Register, which the film cites as a source, Bain Capital under Romney’s leadership invested $46 million in DDi in 1997. It sold many of its shares for at least $93 million and received a $10 million management fee, but the newspaper said Bain retained a 14 percent stake in the firm that was wiped out when DDi filed for bankruptcy during the dot-com bust. (The film suggests Bain had sold all of its shares, saying it had “dumped the rest.”)
Lehman Brothers in 2003 paid $80 million to settle charges by the Securities and Exchange Commission that its bankers had tainted stock recommendations in five instances, including recommendations for DDi. But the SEC did not say Bain had done anything wrong. Romney, who again was by then involved in the Olympics, also invested some of his own money in DDi and sold it before the stock crashed, the Boston Globe reported in 2003.
The film, while focusing on the 2,200 jobs that were lost during the technology bust, does not mention that DDi emerged from bankruptcy proceedings and is currently thriving.
Romney may have opened the door to this kind of attack with his suspect claims that he created 100,000 jobs at Bain Capital, but that is no excuse for this highly misleading portrayal of Romney’s years there. The manipulative way the interviews appeared to have been gathered for the UniMac segment alone discredits the entire film. After the online version of this column appeared Friday, Gingrich called on the super PAC to correct the errors that were identified.