Mitt Romney Airbrushes His Bain Capital Record
It didn't take long—just six minutes into the 98-minute debate—for the moderators at Wednesday night's Republican presidential debate to take aim at Mitt Romney's record at Bain Capital, the powerful private equity firm Romney helped start. Here's that exchange:
NBC's Brian Williams: "Bain Capital, a company you helped to form, among other things, often buys up companies, strips 'em down, gets 'em ready, and resells them at a net job loss to American workers."
Mitt Romney: "That might be how some people might want to characterize what we did, but in fact we started businesses at Bain Capital, and when we acquired businesses, in each case we tried to make 'em bigger, make 'em more successful and grow.
"The idea that somehow you can strip things down and [that] makes them more valuable is not a real effective investment strategy. We tried to make these businesses more successful. By the way, they didn't all work. When it was all said and done, we added tens of thousands of jobs to the businesses we helped support."
Some quick background: Private equity firms like Bain are known for raising money from outside investors; using that money to buy up struggling companies; restructuring the companies (think layoffs, slashing worker benefits, and selling off pieces of the business); and finally selling the (supposedly) leaner, meaner businesses for a profit. One particularly infamous type of private equity deal is the leveraged buyout, in which a private equity firm will borrow a huge amount of money to buy a company, thereby weighing down the purchased company with debt.