Posted by AzBlueMeanie:
Two investigative reports out today on Bain Capital and how Romney profited from business ties of which he has been critical on the campaign trail.
The New York Times reports Romney’s Trade Message and Bain’s China Ties:
[T]here is a twist to the Asimco story that would not fit neatly into a Romney stump speech: Since 2010, it has been owned by Bain Capital, the private equity firm founded by Mr. Romney, who has as much as $2.25 million invested in three Bain funds with large stakes in Asimco and at least seven other Chinese businesses, according to his 2012 candidate financial disclosure and other documents.
That and other China-related holdings by Bain funds in which Mr. Romney has invested are a reminder of how he inhabits two worlds that at times have come into conflict during his campaign for the White House.
As a candidate, Mr. Romney uses China as a punching bag. He accuses Beijing of unfairly subsidizing Chinese exports, artificially holding down the value of its currency to keep exports cheap, stealing American technology and hacking into corporate and government computers.
“How is it China’s been so successful in taking away our jobs?” he asked recently. “Well, let me tell you how: by cheating.”
But his private equity dealings, both while he headed Bain and since, complicate that message.
Mr. Romney’s campaign insists he has no control over his investments since they are held in a blind trust. That said, a confidential prospectus for one of the Bain funds, obtained by The New York Times, promotes China as a good investment for some of the same reasons that Mr. Romney has said concern him: “Strong fundamentals” like manufacturing wages 85 percent lower than what Americans earn, vast foreign exchange reserves and the likelihood that China will surpass the United States as the world’s largest economy.
“Accordingly, Bain Capital expects to see an increasing array of high-growth companies available for investment,” the prospectus says, noting the relative dearth of private equity in China.
Among the companies in which the Bain funds have invested is a global auto parts maker that is in the process of closing a factory in Illinois and moving most of the equipment and jobs to Jiangsu Province, where the Chinese government has built it a new plant; a Chinese electronics retailer accused by Microsoft of selling computers with pirated software; and a Hong Kong-based Chinese appliance maker that was sued for copying another company’s design for a deep-fat fryer.
The campaign said Mr. Romney put his fortune, estimated at $250 million, in a “blind trust” when he became Massachusetts governor in 2003. “The trustee of the blind trust has said publicly that he will endeavor to make the investments in the blind trust conform to Governor Romney’s positions, and whenever it comes to his attention that there is something inconsistent, he ends the investment,” the statement said.
Mittens Romney in 1994 on so-called blind trusts: "The blind trust is an age old ruse, if you will, which is to say, you can always tell a blind trsut what it can and cannot do."
There is much more on Bain's China investments. Romney’s Trade Message and Bain’s China Ties.
The Huffington Post has an investigative report on how Romney profited from investments in tobacco companies in Russia, which puts him at odds with his Mormon faith that forbids smoking. Mitt Romney's Bain made millions on Big Tobacco in U.S., Russia:
As the Soviet Union splintered in the early-1990s, Sushovan Ghosh packed his colleagues into a van and chugged across the collapsing nation, hitting depressed towns and famished cities, busted up factories and lonely kiosks. In each ragged destination, they stopped long enough to interview cigarette smokers.
Ghosh plied the citizenry with free cigarettes and, sometimes, McDonald’s hamburgers.
They were pursuing a lucrative target: determining what Russian smokers wanted out of a cigarette -- specifically, a Western cigarette. "We had to develop a brand the Russians would smoke," Ghosh explained to The Huffington Post. For one study, they interviewed more than 1,000 smokers. "We stopped the bus and offered them cigarettes. And they all queued."
Ghosh’s work for cigarette companies was chaotic, unbridled and, ultimately, deadly. To Mitt Romney and his colleagues at Bain & Co., it was a chance to rake in money. Ghosh said he reported directly to Romney, who was excited about the Russian market. "He was my boss," Ghosh said.
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Although Romney's activities helming the private equity giant Bain Capital have drawn significant attention, his role at Bain & Co. has received almost no public scrutiny. A Huffington Post investigation into Bain's tobacco work found that the consulting firm helped Philip Morris increase its revenues in the U.S., and aided two other tobacco titans as they vied to move forcefully into the Russian market.
* * *
Bain's Russian business wasn’t about family-friendly products. Those deals were about cigarettes. And that work sent Bain into the shadows of the post-Soviet economy -– including helping to orchestrate anonymous, convoluted cash transactions to keep major deals hidden from regulators and competitors. It was part of a free-for-all that involved wholesale looting of major industries, as Western technocrats helped facilitate the transfer of Russia's wealth into the hands of a few oligarchs. That set in motion a populist backlash that helped sweep Vladimir Putin into power, giving the Kremlin dominance over a country Romney has lately called our "number one geopolitical enemy."
Bain was in the middle of all of this, putting to work the same skills it had sharpened in the U.S. -- using taxpayer money to help it gain footholds in Russia. In March 1993, the American government gave Bain & Co. a $3.9 million contract to advise Boris Yeltsin's administration on the privatization of the Russian economy, according records detailing the arrangement uncovered by The Huffington Post. Romney's consultants helped foreign firms and aspiring oligarchs decide how to corral Russia's riches -- including writing an official manual that outlined how best to navigate the process. At the same time, Bain leveraged its contacts with senior Russian officials to arrange sweetheart deals for its tobacco clients.
* * *
Documents chronicling Bain's tobacco work are housed at the University of California at San Francisco's Legacy Tobacco Documents library. Following a tip from a reader who wrote to OffTheBus@huffingtonpost.com, The Huffington Post reviewed hundreds of Bain documents from Legacy's digital archives, along with materials gathered from industry experts and government databases. The Huffington Post also interviewed former Bain employees who worked on the tobacco projects, additional American experts, tobacco control advocates in Moscow, and those with experience with Russia's early, unbridled privatization years.
There is much more on Bain's Russia investments. Mitt Romney's Bain made millions on Big Tobacco in U.S., Russia.
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