What Did He Know and When Did He Know it?
The Romney/Bain Capital scandal is a delicious soap opera, getting more juicy by the day. Now we learn that not only were they busily outsourcing jobs, during the period Romney claimed not to be involved, but they invested in an aborted fetus dumping company, which the right wing anti-choice crowd compares to the Nazis. The contentious issue is whether he, as chairman of the board, CEO and owner, listed on the SEC filings as late as 2002, after claiming to have left control in 1999, to go to the Olympics (No, he wasn’t in the competitive hair-gel category), was actually responsible for these decisions, or at least had knowledge of them.
The consensus seems to be, ”Duh, well of course!” At least among the Democratic pundits. Romney’s own camp says, well, he was much too busy pulling the Olympics’ fat out of the fire to be concerned with the day to day trivialities of his own company. If a recent Congressional race in California is any indicator, the Democratic consensus has a good chance to win out in the mind of the electorate.
Stacey Lawson and the California Second Congressional District Race:
In this race, neophyte wannabe Stacey Lawson touted her credentials as a “job creator,” claiming she was the only one in a crowded field who had created hundreds, thousands, or maybe 50 (depending on what day it was) jobs in various start-ups she worked with. She was maddeningly vague about her roles and it became clear to those in the know that she was exaggerating her importance to any jobs created, at the least.
She was a campaign cash roll, and polling high for the number two spot on the fall ballot in California’s first top-two primary. (For those not in the Bear Republic, the top two vote getters in the June Primary, no matter the party, would face each other in the November General election.) Then information surfaced about one of her more recent start-ups, in which she was actually held the title of Chair of the Board. This company, Chelsey Henry, had failed to remit its payroll taxes, taxes collected from employees, to both the State and Federal governments for a number of quarters. Additionally, it was learned that the business outsourced its product production (high end women’s handbags) to China.
This information emerged in a key debate and was quickly picked up by major news outlets in the District, as well as an anonymous website entitled “Who is Stacey Lawson?
” (which itself sparked a mouth-watering buzz in the blogosphere.) Ms. Lawson compounded her culpability by making several contradictory and misleading statements about her relationship with the company. First she claimed it filed bankruptcy after the discrepancies were discovered. Later she had to correct herself when confronted with the fact that the company was actually taken over by one of its many creditors.
Then she claimed she and the other board members “rectified” the errors in reporting once they learned of it. (They did not and sums owed were still outstanding when the company was acquired by the creditor). She showed a remarkable lack of understanding of the role of Chair of a corporate board, and these failings, along with a dismal voting history, led to her being seen as a less than credible candidate. Instead of being the runner-up in the fall, she finished a weak fourth, despite an incredible war chest filled by investment bankers and venture capitalists.
A Lesson for Democrats in the Presidential Election:
Even though her role with Chelsey Henry placed in an arguably less culpable role than that of Romney with Bain, the lessons are the same. As Chair of the Board, she should not have ducked her responsibility to know what was happening with the company. Romney, as Chair and sole shareholder of Bain, is even more culpable for these shortcomings. His claims to have kept out of the loop was will not play well with the electorate, so long as the story stays alive.
That should be the Democrats number one job between now and the election – keeping the Bain Capital story alive in the press and in the minds of the voters. Granted, California’s 2nd District trends more progressive than the country as a whole, still, added to Romney’s regal attitude, his treatment of his dog Seamus, his wife’s tax deductible high stepping horse and his refusal to release his tax returns, dodging responsibility for Bain is not likely to endear the Republican nominee in the eyes of the American voters, so long as they hear enough about it and they vote.
Maybe in the heady world of venture capital and money management, it’s no big deal, but to the average American, who has to watch every penny, every transaction, and every loaf of bread, it’s a major sign of a politician being out of touch with the people he hopes to govern. If a business man claims his way of doing business is good for the country, make darned sure you know what his way is. Pink Slime in a béarnaise sauce is still just as bad for you.