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MrRodgers -> RE: Romneys Unfortunate Truth (6/24/2012 8:07:36 PM)
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quote:
ORIGINAL: tazzygirl
When we asked the Romney camp for support, spokesman Eric Fehrnstrom sent us a list of jobs added at three companies in which Bain had invested, saying that these three examples alone created over 100,000 jobs: Staples, which had 89,000 employees as of Dec. 31, 2010; The Sports Authority, which had 15,000 employees as of July 2011; and Domino’s, which has added 7,900 jobs since 1999.
That’s hardly a rigorous analysis of jobs gained and lost at companies Bain backed. And does Romney deserve credit for all of those jobs? Bain was but one of several investors in The Sports Authority, which was launched with the monetary help of William Blair Venture Partners, Phillips-Smith and Marquette Venture Partners. Not to mention the work of founding executives at the company, such as CEO Jack A. Smith.
Plus, Kmart owned the company for about five years starting in 1990. Does Kmart get credit for whatever job growth occurred then? In 2006, the private equity firm Leonard Green & Partners acquired Sports Authority. Does Bain, and Romney, still get credit for jobs created after the company is bought or sold years later?
Staples, too, was launched with money from William Blair and Bessemer Venture Partners, two firms mentioned by Staples founder and former CEO Tom Stemberg, who, it could be argued, deserves the most credit for jobs added by the office-supply store. In comments published by CNN Money in 2002, Stemberg said that Bain “gave us a boost” by talking them up to Avery Dennison, an office-supply wholesaler.
Determining who gets credit for how many jobs is challenging, to say the least.
As we reported before, Bain managers told the Los Angeles Times that they weren’t focused on creating jobs; they were trying to make money.
Los Angeles Times, Dec. 3: “I never thought of what I do for a living as job creation,” said Marc B. Walpow, a former managing partner at Bain who worked closely with Romney for nine years before forming his own firm. “The primary goal of private equity is to create wealth for your investors.”
And then there are the job losses. Bain took over other companies where layoffs, and even bankruptcies, followed. Romney said that 100,000 figure was “net-net.” So, whatever job creation figure one could use, we’d have to subtract jobs lost, such as 385 jobs cut at American Pad & Paper; 1,900 positions cut or relocated at Dade International; 2,100 workers laid off from DDI Corp.; 2,500 jobs lost at Clear Channel Communications; and 3,400 layoffs at KB Toys. Those examples come from Politico and the New York Times.
http://www.factcheck.org/2012/01/romneys-shaky-job-claims/
Romney changes tune on layoffs
All very probably true but look people, it doesn't matter how, why or who created the jobs...they were created. It doesn't matter that billions in equity in these deals is achieved by eliminating jobs. Off-shoring yes, reorganized no except the generous incentives.
Thus we need to look at the incentives and we attach to these deals certain benefits directly as a result. For example:
Heard of ERISA ? Wouldn't be surprised if you hadn't, most don't have any idea. It is the 'Employee Retirement Income Security Act.' What did that do ? It protected the entire retirement portfolio against the vultures (like Bain et al) from in-effect, stealing it. First, it was that, then medical benefits, then other benefits, then your job.
We create some very special terms for the tax incentives and allow equity investors (partners) hold these companies, stocks or other assets for a year and pay only 15% federal tax.
Remove the incentives, redirect capital to actually doing something or making something. Then you'll see job creation.
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