On the eve of South Carolina's January 21st 2012 Republican primary, a local steel union leader debunked as totally false Mr Romney's claim that he created hundreds of jobs when his company took over Georgetown Steel in the Palmetto State.
Mr James Sanderson, who started working at the mill in 1974 and was elected president of United Steelworkers Local 7879 in 1988, said that "The experience we've had here at Georgetown Steel contradicts Mr Romney's job creator statement."
He said that the mill was doing well, earning profits until Mr Romney's outfit Bain Capital took over.
Under Mr Romney's leadership, the mill slashed 1,750 jobs, padlocked a division that had existed for 100 years and eventually sank into bankruptcy.
The evidence gives strong credence to charges by rival Republican presidential candidates that Mr Romney is a vulture capitalist who fattened the profits of Bain Capital by stripping manufacturing companies of their assets and terminating the jobs of thousands of workers. It has exposed as a hoax Romney's argument that as a corporate CEO he knows how to create millions of good jobs.
Mr Sanderson said that "We take exception to his claim that he comes in and takes over companies that are ailing. That wasn't the case here at Georgetown. We were doing well, making money, doing very well financially. But shortly after Bain Capital came in 1995, the conditions deteriorated quickly at our plant. They took everything they could out of the company. They stopped investing in new equipment. The equipment was not maintained."
Mr Sanderson charged that Bain Capital assigned Mr Mark Essig to manage the plant and a team of managers who didn't know anything about steelmaking were put in charge. They were just bean counters.
According to an investment prospectus obtained by the LA Times, Bain Capital acquired GS Industries, parent corporation of Georgetown Steel, for USD 24.5 million in 1993. By 2000, Bain had reaped USD 58.4 million in profits from the takeover, largely through stripping the mill of assets and paying their executives, Mr Romney in the first place, huge bonuses and stock options. Bain was sucking about USD 900,000 annually from GS Industries in the form of dividends and annual management fees.
When GS Industries merged with Armco Steel in 1995, it employed 3,800 workers worldwide, and had USD 1 billion in assets, the largest producer of carbon wire rods in the US. But within years of Bain Capital's takeover of the company, it owed USD 554 million in debts against assets of USD 395.2 million. It filed for bankruptcy in 2001.
The Myrtle Beach Sun Times said that Mr Romney, founder of Bain Capital in 1984, was in charge of the firm for most of the time it owned GS Industries. The paper quoted retired Georgetown Steel worker Mr John Ethridge, who charged that Romney's outfit "treated us like dirt.
Less than a year after taking over Georgetown Steel, Bain Capital cut the workers' profit sharing plan twice without telling the workers. The first they heard was when they noticed that the profit sharing benefit was cut from USD 5.60 an hour to USD 1.25 an hour in their paychecks. Soon, the profit sharing disappeared from their checks permanently.
Georgetown Steel survived, bought by Mittal Steel in 2005. The mill now employs 250 hourly and salary employees. USWA Local 7879 still represents the workers.
But steelworkers were not the only ones to feel Romney's whip. Just down the road was a photo album manufacturer, owned by the Holson Burnes Group. Bain Capital bought the company for USD 10 million and stripped it, raking in USD 22.6 million in profits between 1986 and 1992 when HBG declared bankruptcy, terminating the jobs of 150 workers.
(Sourced from www.peoplesworld.org)
