Given his underwhelming performance in the Republican primary, Texas Gov. Rick Perry would seem an unlikely model for a presidential campaign. Yet the Obama administration is taking a page out of Perry’s hastily retired strategy book by going on the attack against presumptive challenger Mitt Romney for his record at Bain Capital, the venture capital firm Romney co-founded and once headed.
That now-famous mental block apart, Perry’s most notable contribution during his brief time in the running was to target Romney’s tenure at Bain. In a series of ill-fated snipes, Perry condemned venture capital firms like Bain as “vultures” who wait for companies to “get sick and then they swoop in, they eat the carcass. They leave with that and they leave the skeleton.” The populist line earned Perry some deserved scorn from critics, who pointed out that venture capital takeovers of the kind Bain specialized in frequently offered a lifeline to moribund companies that would have gone out of business absent outside investment.
If Perry’s untimely political demise serves as an object lesson about the perils of crude populism and anti-capitalist demagoguery, the Obama administration seems determined to ignore it. This week, the Obama reelection campaign unrolled a television ad to run in five swing states that essentially recycles Perry’s attacks on Romney and Bain. The ad, called “Steel,” features interviews with former employees at GST Steel, a Kansas City, Missouri, steel mill that was taken over by Bain in the 1990s and filed for bankruptcy in 2001. The employees in the ad unanimously condemn Romney and Bain for causing job losses at the mill. “It was like a vampire,” one worker laments, referring to Bain. “They came in and sucked the life out of us.” Rick Perry would have approved.
Whether voters will is far from certain. Among other flaws, the ad is in desperate need of fact checking. For instance, the ad suggests that Romney was in charge when GST Steel filed for bankruptcy, when in fact he had left Bain two years earlier, in 1999, to oversee the Olympics in Salt Lake City, Utah. That’s not to say that no one in Bain’s leadership from the time is relevant to the election. The current managing director and chief investment officer at Bain is one Jonathan Lavine, who joined Bain in 1993. But Lavine has another distinction, as well: According to the non-partisan Center for Responsive Politics, which tracks federal campaign contributions, Lavine is a leading bundler of campaign contributions for Obama’s campaign and has raised between $100,000 and $200,000 for Obama’s reelection effort. Conveniently, the “Steel” ad omits that detail.
The bigger flaw in the ad is the false premise that Bain was primarily responsible for the job losses at GST Steel. Obama’s ad makes the charge directly, through a negotiator for the workers at GST Steel who says, “Bain Capital was the majority owner. They were responsible.” That might be a damning criticism if it were true, but it isn’t. The fact is that GST Steel was already going out of business, which is why it was taken over by Bain in the first place. At worst, Bain delayed the mill’s day of reckoning.
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