Confusion

According to Bain Capital, Romney had “absolutely” no management role after February of 1999. A Bain Capital press release from July of 1999 contradicts that claim.

So Mitt Romney had

absolutely no involvement with the management or investment activities of the firm or with any of its portfolio companies since the day of his departure

in February of 1999. That’s according to Bain Capital.

Unfortunately, someone seems to have neglected to tell Bain Capital about this. In July of 1999 it issued a press release quoting “Bain Capital CEO W. Mitt Romney, currently on a part-time leave of absence.” In the release, Romney comments on the departure of two Bain employees to set up their own firm:

While we will miss them, we wish them well and look forward to working with them.

Absolutely no involvement with management. No siree!

Yes, of course corporate press releases are mostly B.S. But it’s clear that the claim that Romney stopped running Bain in February of 1999 is a bit of revisionist history, made up later for political purposes. It’s not what he, or the firm, were saying at the time.

Do you think that at some point Glenn Kessler and his fellow fact-checkers are going to allow themselves to be influenced by the facts?

Author: Mark Kleiman

Professor of Public Policy at the NYU Marron Institute for Urban Management and editor of the Journal of Drug Policy Analysis. Teaches about the methods of policy analysis about drug abuse control and crime control policy, working out the implications of two principles: that swift and certain sanctions don't have to be severe to be effective, and that well-designed threats usually don't have to be carried out. Books: Drugs and Drug Policy: What Everyone Needs to Know (with Jonathan Caulkins and Angela Hawken) When Brute Force Fails: How to Have Less Crime and Less Punishment (Princeton, 2009; named one of the "books of the year" by The Economist Against Excess: Drug Policy for Results (Basic, 1993) Marijuana: Costs of Abuse, Costs of Control (Greenwood, 1989) UCLA Homepage Curriculum Vitae Contact: Markarkleiman-at-gmail.com

15 thoughts on “Confusion”

  1. An old engineering joke describes “quality control” as the process of ensuring that product quality does not interfere with product profitability.

    In just this way, Mr. Kessler seems to interpret “fact-checking” as a charge to ensure that the facts don’t interfere with his employer’s preferred “both sides” narrative.

  2. This is the ISLM curve applied to political narrative.

    I’m only sad because so few will get that joke.

  3. Not surprising to see echoes of truther theorizing here. When supposedly smart people can’t tell the difference between forward looking statements of intentions and historical statements, it’s not far to wondering about how the bin Laden’s got out of the US, and then we’re talking about the rest of the truther theories too, aren’t we?

    In this case, it’s pretty clear that the part-time leave of absence story was the plan, obviously, which is why it was announced that way in February 1999. Apparently that was still the plan in July of 1999, though the plan had to that extent failed, as plan often do, (see, e.g. the Obama economic plan), as Romney was not involved in the management of the firm. The press release was drafted by the PR folks, and of course it quoted the titular head of the organization, who at that point had been absent for months, but who was still planning on return. And as things happened, Romney eventually realized that he wasn’t returning half time, and then wasn’t returning at all, and that’s why when he left, all of his departure agreements agreed that he’d left in February 1999. And that’s even though it would have been more convenient politically for him to say that he’d been involved until 2002. (The political valence of his involvement has changed since he was running for office in MA obviously. And flexible Democrats have changed their view of the facts.)

    1. This, of course, is why he was listed as being the CEO until 2002, and why he is shown to be attending meetings as late as 2002.

      Beyond that, a sole owner never gets to escape responsibility for the company. If you own 10,000 shares in XOM, then you don’t really have any say. If you’re the only shareholder, then the only reason you don’t have complete control is because *you* picked someone else to have all of the control. In that circumstance, you don’t get to say that it was someone else’s fault. You picked that someone else and unless there is obvious evidence of you objecting to what that person did, it all ends up in your lap.

      1. Which meetings? Staples meetings? Marriott meetings? Or Bain meetings?

        If you’re going to play lawyer, pretend to be a good one. Romney was the sole shareholder and then he left, and presumably he made various explicit or implicit promises to people about what the company would look like, and they negotiated the transfer of ownership over a period of time. Is it really your position that after Romney had made those promises he could renege without consequence and resume control?

        1. For what it’s worth, it was pretty clear to political observers who watched the O’Brien-Romney 2002 race for governor that Romney’s political strategy at that time was to say he’d left Bain in Feb. 1999 and wasn’t responsible for anything Bain-related that happened after that date. The political advantage for Romney saying that is that there were lots of Bain-related bankruptcies, failed companies, lost jobs in 2000 and 2001 that the O’Brien campaign wanted to tie to Romney. By sticking to the “I left in Feb. 1999 and can’t be held responsible for anything after that date” line, Romney effectively neutralized what would have been some of O’Brien’s strongest attacks.

        2. He testified to the state of Massachusetts that he attended Bain meetings and was actively involved in the decisionmaking. Since I would never accuse Mitt Romney of perjury without strong evidence, I assume that means that he did exactly what he said.

          1. J., you might be good enough to supply a link, or a quote, or something for that little supposed piece of evidence. The quotes I’ve seen are that he attended Staples meetings, Marriott meetings, and meetings of another company’s board of directors, and none of those three are Bain. Those who were at Bain at the time say he wasn’t involved. He says he wasn’t involved. There’s no evidence he was involved. The fact that there’s somehow a controversy about this is as a result of the same sort of process by which there’s a controversy about where Obama was born.

          2. So were Staples and Marriott acquired in some sense by Bain with Romney as one of several Bain designees on their boards? If so wouldn’t they be Bain portfolio companies? Or Bain Capital entities?

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