Photo by Scott Olson/Getty Images
If you want to see more American jobs, do you want to hire a guy whose area of expertise seems to be making them disappear?
A new story in The New York Times scrutinizes one of Mitt Romney’s biggest arguments for being the next president: his business management experience. And the picture is not entirely pretty.
The former head of Bain Capital helped to acquire and sell some 150 companies before he became the governor of Massachusetts in 2003. One of those sales and acquisitions, that of medical company Dade International, left 1,700 American workers without jobs and a company worse off because of high fees paid to Romney and his associates and long-term debt, according to some former company officials.
During the 1980s, Bain Capital was reportedly one of the few companies combining financial investment strategies and management consulting, and Romney was the company’s top dog. People at Bain got very rich, very fast, under Romney’s leadership and the fortune of a company offering a unique combination of services.
But Dade International, which grew fast under new management from Bain Capial, also nearly tripled debt, and soon workers were feeling squeezed. Generous pensions turned into 401(k) plans, required overtime didn’t result in extra pay, and salaries were cut. Soon layoffs began, and the Bain convinced Dade to take on even more debt.
In one instance, workers who were convinced to move from a closed Puerto Rico Dade plant to one in Miami — which soon after was also closed — were hounded by the company to pay back moving expenses given to them.
“They were treated horribly,” former human resources manager Cindy Hewitt tells the Times. “There was absolutely no concern for the employees. It was truly and completely profit-focused.”
The push from managers for Dade acquiring debt grew even more as the company’s troubles compounded. Eventually, the company had to file for bankruptcy. But it bounced back in a big way as a property. And the haul for Romney’s company and the investors originally recruited to buy Dade, including Goldman Sachs? Some $420 million.