Commentary Magazine


No New Break in Bain Timeline Story

Based on all the sensational headlines last weekend, you might think there was actually a new break in the Bain Capital timeline story. The Huffington Post has: “Ed Gillespie: Mitt Romney Retired Retroactively From Bain.” MSNBC has: “Former Bain Capital partner says Romney was ‘legally’ CEO of Bain Capital Until 2002.”

Retired retroactively? Legally CEO? Sounds scandalous, but there’s nothing new when you get past the headlines. The New York Times report today concludes the exact same thing media fact checkers and the Romney campaign have been saying since January — Romney de facto left Bain in 1999, when he went to run the Olympics. His name remained on the SEC forms until the company a.) established that he wouldn’t return to a management role after the Olympics ended, b.) transitioned to a new ownership structure:

Indeed, no evidence has yet emerged that Mr. Romney exercised his powers at Bain after February 1999 or directed the funds’ investments after he left, although his campaign has declined to say if he attended any meetings or had any other contact with Bain during the period. And financial disclosures filed with the Massachusetts ethics commission show that he drew at least $100,000 in 2001 from Bain Capital Inc. — effectively his own till — as a “former executive” and from other Bain entities as a passive general partner.

An offering memorandum to investors in Bain’s seventh private equity fund that was circulated in June 2000 also suggests that Mr. Romney was no longer actively involved in managing firm investments at the time. The memorandum, first published by Fortune, provides background on the “senior private equity investment professionals of Bain Capital.” Eighteen managers are listed; Mr. Romney is not among them.

On another filing with Massachusetts officials, Bain Capital listed all of Bain’s directors and officers for 2001. The form lists Michael F. Goss as “president, managing director and chief financial officer,” along with seventeen other managing directors. Mr. Romney is not among them, suggesting that while he still owned Bain’s management company, he was not an officer of the company.

Let’s remember why this story matters. Not because Romney may have been engaged in criminal behavior by listing himself on the SEC forms, as the Obama campaign has wildly and absurdly alleged. But because the Democratic Party wants to tie Bain’s business errors between 1999 and 2002 around Romney’s neck. The response from Bain insiders — several of whom are Democrats and Obama donors — has unanimously been that Romney was not involved with management after he left to run the Olympics. In other words, there’s no standing to hold him accountable for flawed investments and management blunders after that date.

That brings us to the second reason why the Obama campaign has been hammering this issue: they’re desperate for Romney to release his tax returns from the past five or ten years. According to Democrats, that’s the only way he can actually put this issue to rest.

I’m personally with the Obama campaign on one point — Romney should release more tax returns. Politician transparency is important, and releasing multiple years of tax returns, as presidential candidates traditionally have, would be in the public interest.

But you can believe that without buying into the Democratic Party’s conspiracy theories about the Bain timeline. From the evidence already out there, there is zero reason to believe that Romney was actively managing Bain after 1999.