As a buyout king turning around troubled companies, Mitt Romney once practised the kind of “creative destruction” free market Republicans usually celebrate.
But desperate to blow up his candidacy, Mr. Romney’s rivals for the party’s presidential nod are suddenly digging into his past at Bain Capital in search of ticking explosives.
If and when the “Bain bomb” goes off, the likely beneficiary may not be any one of them. But President Barack Obama just might owe his re-election to their early groundwork.
The Bain back story underscores a major liability the millionaire Mr. Romney could shoulder in a general election against Mr. Obama. At a time when income inequality, outsourcing and capitalist greed are scourges, he is a walking billboard for all three.
On the eve of Tuesday’s New Hampshire primary, which Mr. Romney is expected to win handily, the former Bain chief spent the day defending the messy art of capitalism as practised by the Boston-based buyout firm he led for 15 years until 1999.
A Wall Street Journal investigation published on Tuesday found that of the 77 companies Bain invested in under Mr. Romney’s stewardship, at least 20 filed for bankruptcy or went out of business within eight years of Bain’s initial involvement.
Mr. Romney and his Bain partners got fabulously rich in the process. The firm pocketed gains of $2.5-billion (U.S.) on the $1.1-billion it invested in the companies and Mr. Romney rode the wave to a personal net worth currently estimated at about $250-million.
Whether that makes Mr. Romney a capitalist hero or zero may depend on your politics.
But the former Massachusetts governor did not help himself by telling a business audience on Tuesday that he liked “being able to fire people.” He meant insurance companies that provide bad service. But he should have known the comment would live on in infamy.
It was proof that even the most tightly scripted candidate of them all can occasionally blow his lines.
An embittered Newt Gingrich, seemingly resigned to his fate in New Hampshire but hoping for rebirth in South Carolina, threw the first stone at Mr. Romney on Tuesday.
“They apparently looted the companies, left people unemployed and walked off with millions of dollars,” the former Speaker of the House of Representatives said of Mr. Romney and his Bain cohorts. “That’s not traditional capitalism.”
Texas Governor Rick Perry, also betting it all on the Jan. 21 South Carolina primary, accused Mr. Romney of getting “rich off failures and sticking it to someone else.”
Even former Utah governor Jon Huntsman, the most measured of the candidates, could not resist laying into Mr. Romney. But he had a more immediate need. He must break through in New Hampshire to have any hope of continuing on to South Carolina.
“Governor Romney enjoys firing people. I enjoy creating jobs,” Mr. Huntsman said. “It may be that he’s slightly out of touch with the economic reality playing out in America right now, and that’s a dangerous place to be.”
At a rally at a metalwork factory here, Mr. Romney was forced to spend a rare press conference defending his Bain record, reiterating his assertion that the businesses in which the firm invested on his watch went on to create more than 100,000 net new jobs.
“If [voters]want President Obama and a loss of two million jobs, a decline of median income in America by 10 per cent and people looking at very difficult prospects going forward, they can choose President Obama,” he charged. “But if they want someone who understands how this economy works at the level of job creation – of businesses failing and succeeding – that’s what I can bring to the table.”
That pitch may become a tougher sell as voters are exposed to attack ads put out by Mr. Romney’s GOP rivals and the Obama campaign that focus on Bain’s darker side.
Indeed, a group that supports Mr. Gingrich will begin running television ads in South Carolina this week that draw on a scathing documentary about Mr. Romney’s Bain legacy. The $3.4-million ad buy is massive by South Carolina standards.
“Nothing mattered but greed,” says the trailer for the film, King of Bain, which calls Mr. Romney a “predatory corporate raider” and “scavenger.”
The Palmetto State has a reputation for dirty politics. There is no telling what politicians as desperate as Mr. Gingrich or Mr. Perry, who is still sitting on millions raised at the outset of his candidacy, might resort to. South Carolina is by all accounts their last chance.
It is hard to believe the Romney campaign – whose operatives spare no detail, down to the floor tape telling their candidate where to stand – had not anticipated all of this.
But could it be they forgot to ask the focus groups what they thought about having a predatory corporate raider for president?