| Taking a sledgehammer to the foundation |
Mitt Romney has run into quite a bit of scrutiny lately, most notably about his background as it relates to jobs.
He said there have been times he worried about getting fired, and that wasn’t true. He said he “ likes being able to fire people,” and that became a big headache. He’s being haunted by many of his unemployed victims. Romney’s also made all kinds of claims about President Obama’s jobs record, all of which have been debunked.
But the one claim that really matters is Romney’s insistence that he deserves credit for creating “over 100,000 jobs” at his private-equity firm.
The Romney campaign initially refused to substantiate the claim, which is never a good sign. Then it said the number is accurate just so long as one excludes all of the layoffs Romney’s firm made, and includes jobs created after he left the firm. Then Romney himself said the figure is a net total, after the layoffs are factored in.
Glenn Kessler returns to the subject today, and his assessment is less than kind.
Romney never could have raised money from investors if the prospectus seeking $1-million investments from the super wealthy had said it would focus on creating jobs. Instead, it said: “The objective of the fund is to achieve an annual rate of return on invested capital in excess of the returns generated by conventional investments in the public equity market and the private equity market.” Indeed, the prospectus never mentions “jobs,” “job,” or “employees.”
Second, it has become increasingly hard to understand how Romney’s personal involvement played a role in creating these jobs, especially years later. He clearly is adding up all the jobs now at the companies that are thriving, arguing these numbers far outweigh the job losses at companies that failed. But as the Wall Street Journal reported Monday, the failure rate one can attribute to Bain Capital changes significantly if one counts five years from an investment or eight years from an investment.
Bain, in fact, rejected the Journal’s analysis, saying it “uses a fundamentally flawed methodology that unfairly assigns responsibility to us for many events that occurred in companies when we did not own or control them, and disregards dozens of successful venture capital investments.”
In other words, Bain appears to be rejecting a central premise of Romney’s calculation — that years after the investment ended, one can attribute either good news or bad news about the company to Bain’s involvement.
Kessler’s analysis concludes no part of Romney’s claim is credible or supported by evidence, and that much of the candidate’s argument fails to “pass the laugh test.”
This is no small revelation. As Jonathan Cohn put it, “The linchpin of Romney’s most powerful argument has turned out to be bogus.”
That’s not an exaggeration in the slightest — this analysis is taking a sledgehammer to the foundation of the Republican frontrunner’s entire campaign. Romney’s message can be summarized in one sentence: “I’m a successful businessman with a track record of creating jobs.” Romney doesn’t like to talk about health care (his plan was mirrored by the president); he doesn’t like to talk about his gubernatorial record (he failed miserably to create jobs); and he doesn’t like to talk about social issues (he was a liberal on these issues up until quite recently). The raison d’etre for Romney’s effort comes down to his private-sector record and the “over 100,000 jobs” he created.
And that talking point has been debunked, leaving Romney with no credibility on his campaign’s top issue.