With the South Carolina primary looming next Saturday, the remaining Republican candidates and their “Super PACs” have drenched the state in attack ads against one another. The winner of the South Carolina Primary has gone on to receive the GOP nomination since 1980; if Mitt Romney’s opponents cannot stop his momentum coming out of his win in New Hampshire, the game is over.
Newt Gingrich’s Super PAC “Winning The Future” has released a 28-minute film attacking Romney’s record as CEO of Bain Capitol, while Rick Perry characterized Romney as a “vulture capitalist” and took aim at the private equity firm that swelled the New England politician’s personal fortune to a reported 250 million:
We’re trying to lure more venture capitalists into my home state every day, but the idea that you get private equity companies to come in and, you know, take companies apart so they can make quick profits and then people lose their jobs, I don’t think that’s what America’s looking for. I hope that’s not what the Republican Party’s about."
A private equity firm is a company that collects money from investors, including pension funds, endowments and wealthy individuals, and uses that money to buy failing or undervalued companies. These leveraged buyouts can prevent workers from losing their jobs by restructuring companies to make them viable again, but can also turn a quick profit by selling off a company’s assets and terminating its work force.
Romney’s critics point to Bain Capital’s purchase of GS Technologies as an example of the latter. Bain made 12 million in profit and over 4 million in consulting fees while being awarded three million in tax breaks from the state of Kansas. GS Technologies went bankrupt, its 750 employees lost their jobs and the federal Pension Benefits Guarantee Corporation was forced pay 44 million towards the company’s pension plan when Bain refused to honor its agreement with workers.
With South Carolina’s unemployment over 8% for the past three years Romney’s history of job termination, coupled with sound bites like “I like to be able to fire people,” might convince some voters to abandon the frontrunner. Fearing his critics may be laying the groundwork for President Obama’s 2012 reelection campaign, members of the Republican establishment have come out swinging in Romney’s defense.
Tom Donohue, president of the U.S. Chamber of Commerce, sharply criticized Gingrich and Perry yesterday morning in a press conference for his yearly “State of American Business” speech: “I think it's just been foolish for the Republicans to carry on that line of attack because they aren't doing anything but setting up the ad base for their opponent.” Chuck Wynn, a prominent South Carolina donor of Rick Perry’s, left the Governor’s camp because of negative television spots airing all over the state, which he said were like “fingernails on a chalk board.”
Mitt Romney’s campaign has responded to the attacks by highlighting companies like Staples and Sports Authority, Bain Capital acquisitions that expanded and created jobs under the firm’s stewardship. Meanwhile, the Republican backlash against his opponents only serves to remind voters that Romney is the most electable candidate in the field, and he this will be a central part of his message in the next week. Curtis Loftis, North Carolina’s state treasurer, articulates the voting logic that Romney hopes will make him a lock next Saturday for the primary and the nomination:
Voting is a clerical decision. You’ve got to make a choice. Either you come in first place or dead last. People love the newness of Cain, the spirit of Perry, the genius of Gingrich, but they know Romney is the only one who can win.”