Obama Campaign Challenges Fact Checker Report on Romney Outsourcing*

Jul 2, 2012 6:00am

The Obama Campaign is vigorously defending its attacks on Mitt Romney as an “outsourcer,” following an analysis by one independent fact-checker that called some of the claims “untrue” and others “thinly supported.”

In a six-page letter to FactCheck.org, deputy Obama campaign manager Stephanie Cutter disputes the notion that Romney cannot be held accountable for outsourcing by Bain Capital-owned companies after February 1999, when he stepped down as CEO.

“The statement that Gov. Romney ‘left’ Bain in February 1999 — a statement central to your fact-check — is not accurate,” Cutter writes. “Romney took an informal leave of absence but remained in full legal control of Bain and continued to be paid by Bain as such. Governor Romney would have the period of Bain service understood differently, for the obvious reason that there is much in this l999-2002 period that he would prefer to avoid accountability for.”

Cutter cites statements by Romney, his wife Ann, lawyer Bradley Malt, and filings with the Securities and Exchange Commission as evidence that he maintained significant managerial and financial ties with the company during the period when the outsourcings referenced in Obama TV ads occurred.

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Romney said he would “stay on as a part-timer with Bain, providing input on investment and key personnel decisions,” the Boston Herald reported in February 1999 after an interview with the private equity executive.  The letter also cites dozens of SEC filings from after March 1, 1999, which shows various Bain holdings as “wholly owned by W. Mitt Romney.”

FactCheck.org reporters Brooks Jackson and Eugene Kiely had claimed in their report that the Obama campaign overreached in its TV ads labeling Romney as an “outsourcer in chief” because they “found no evidence to support the claim that Romney – while he was still running Bain Capital – shipped American jobs overseas.”

It’s an argument the Romney campaign regularly makes to rebuff Democratic attacks on Romney’s Bain Capital record: Aides claim many of the most cited cases of Bain-related bankruptcies, job losses, and outsourcing occurred after Romney left the company.  The Romney campaign also disputes a recent Washington Post report alleging that Romney’s companies shipped U.S. work abroad, saying the paper confused outsourcing with “off-shoring.”

But Jackson and Kiely don’t dispute the notion that some work went overseas. “That was the core business for Modus Media and SMTC Corp. — two outsource companies featured in a June 21 article in the Washington Post that has been the basis of recent Obama TV ads,” they write. “Bain also invested in U.S.-based companies that sold goods manufactured here and abroad, and some of those companies closed U.S. facilities and eliminated U.S. jobs.”

What was Romney’s role in those cases?  It’s not entirely clear. While Team Obama claims Romney’s departure from Bain in 1999 wasn’t a clean break, they do not present any direct evidence that Romney had a hands-on, decision-making role in any of the outsourcing cases cited in the ads.

FactCheck.org is a project of the nonpartisan Annenberg Public Policy Center at the University of Pennsylvania.

Read the full Cutter letter to FactCheck.org HERE.

*UPDATE: 7:25 pm ET:   FactCheck.org has resoundingly rejected the Obama campaign’s request for a correction to their report.   Reporters Brooks Jackson, Robert Farley and Eugene Kiely review point by point Cutter’s claims and argue that if what she insinuates were true, then Romney would be guilty of a federal felony.  But she doesn’t produce any concrete evidence that Romney maintained a direct management role after February 1999, they say.

“After reviewing evidence cited by the Obama campaign, we reaffirm our conclusion that Romney left the helm of Bain Capital when he took a leave of absence in 1999 to run the Salt Lake City Organizing Committee for the 2002 Winter Olympics - as he has said repeatedly — and never returned to active management,” the trio writes.

“The Obama campaign’s recent ads thus mislead when they point to investments made by Bain, as well as management decisions made by companies in which Bain invested, after that time. The Obama campaign’s objections are contained in a six-page letter sent to us (and  — without notice to us — to other news organizations as well). It cobbles together selective news snippets and irrelevant securities documents in an attempt to show that Romney was still running Bain Capital on a part-time basis while he was also running the Olympics committee.

“In a nutshell, the Obama campaign is all wet on this point,” they conclude.

Read the full FactCheck.org rebuttal HERE.

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