Guest Column: GST Steel, Bain Capital not to blame for job losses
By Dave Willis
HEADLINE: (or should be) “Lie detector finds big fib in Obama’s campaign — again.” In an Obama SuperPAC ad, Joe Soptic claims Mitt Romney closed GST Steel, causing Joe to lose his job. He also said, a short time after that, his wife became ill, resulting in her death as the result of cancer.
Here are the facts. GST Steel, under varying names, had been in Kansas City for 113 years. Over the last 30 years of its existence, its number of employees had plummeted, as had profits. In 1970, GST employed 4,500 people. By the time it closed in 2001, their workforce had atrophied to 750. Bain Capital acquired GST in 1993. In 1995, Bain acquired three other steel companies and merged all four. Many analysts believe that without Bain, GST would have closed much sooner than it did.
Critics charge that Bain came in as a vulture capitalist, bleeding the company of money. That is a charge the former CEO Mark Essig denies. On America Live, he said, “The facts are, Bain was involved in that investment for over eight years. They pumped between $100 and $125 million into the company. Their thesis was that they could turn around a plant that had been slated for closure. They almost pulled it off until the late 1990s and early 2000s, when we had a flood of cheap, imported steel that closed the doors of that plant.”
The US International Trade Commission reported that between 1999 and 2003, 31 steel companies in the United States closed their doors. The primary reason for those closures was cheap Asian steel coming into this country. By closing GST, Bain was able to keep three other steel mills open, saving thousands of jobs.
Now to Joe’s claims stated above. In 1999, Mitt Romney stopped his day-to-day oversight of Bain Capital to run the Olympics in Salt Lake City. He officially remained its CEO until 2002. Bain closed GST in 2001. Contrary to Joe Soptic’s claims, his wife Rene did not lose her health insurance then. She was employed by a thrift store called Savers, through which she was insured. In 2003, two years after GST closed, Rene injured her rotator cuff, and she left her job. Joe’s new job as janitor did not cover her. In 2006, five full years (not “shortly after” as Joe claims) following GST’s closure, Rene went to the hospital with symptoms of pneumonia. During that visit, she was diagnosed with stage 4 cancer, and died 22 days later. Before GST went bankrupt, Joe Soptic was offered a buyout by the company, which he turned down.
The bottom line here is that there was no mistreatment of Joe or his family on the part of GST Steel or Bain Capital. In fact, Bain Capital did everything it could to first, make the company viable, and second, take care of its employees. This mendacious smear tactic on the part of Obama’s campaign is a despicable misrepresentation, and typifies his entire approach to campaigning and governance. As a country, we cannot afford four more years of this “win at any cost, no matter how destructive or dishonest it may be” attitude on the part of those in Washington. I invite you to look at the facts and vote for Mitt Romney, a respected people-friendly and business-friendly candidate in November.
Dave Willis is a resident of Rockford.
From the Aug. 22-28, 2012, issue