Why Isn’t Mitt Romney Getting Hammered on the Bain-Sensata Story?

I know everyone here has probably heard about the Bain-owned company Sensata Technologies, which is currently in the process of shipping all of its jobs to China. Mitt Romney has significant financial holdings in Sensata and in other Bain-connected Chinese Companies. Sensata workers have reached out to Mitt Romney repeatedly, begging him to use his influence to save their jobs, but he has ignored their pleas. Workers have now set up a tent city they call Bainport (see photo), and today they held a rally with workers who were laid off by a Bain-owned Samsonite plant in France. Here is the Bainport website.

FREEPORT, Ill. — French Samsonite workers who were laid off and robbed of their severance pay by Bain Capital will join Freeport Sensata workers for a rally at “Bainport” in Freeport, Ill., at 3 p.m., Saturday, Oct. 13.

The rally is in protest of Bain’s decision to close the Freeport, Ill., Sensata Technologies plant and outsource 170 jobs to China. The plant is set to close in November.

“We’re coming to Bainport to show our support for American workers fighting against the same economic model that destroys good jobs likes ours in France,” said Samsonite worker Brigitte Petit. “The struggle to save these Sensata jobs from outsourcing is a struggle on behalf of good jobs across the globe.”

Sensata Technologies, 2520 S. Walnut Road, Freeport, which was created by Bain Capital in 2006, develops, manufactures, and sells sensors and controls for major auto manufacturers such as Ford and General Motors.
Despite rising profits, the company plans to institute the final layoffs in November. The workers are training their Chinese replacements, who have been flown to Illinois by the company.

During the retraining, the American flag flying over the Freeport, IL plant was removed and replaced by the Chinese flag.

Romney has significant investments in Sensata as well as in other corporations in China; and he has gotten tax breaks from outsourcing  jobs to China–including the Sensata jobs. Yet, during his debate with President Obama on October 3, Romney had the nerve to claim he didn’t know the U.S. gives tax breaks to outsourcers.

I simply can’t understand why the Obama campaign isn’t using this scandal to hammer Romney unmercifully. There has been some coverage of the issue in the corporate media, but not enough to reach all those low information voters out there. Ed Shultz has been talking about the issue over the past couple of days, and perhaps that will have an effect.

Although Romney didn’t make the decisions that led to the crisis in Freeport, he is still closely tied to Bain and does have influence over the company he founded. From the NYT, July 18, 2012:

There’s a plant in Freeport that makes sensors and controls for cars and airplanes. It’s owned by Sensata Technologies, a company that Bain bought in 2006, somewhere between four and seven years after Mr. Romney left the company. Last year, Sensata announced that it was moving the plant to China at the end of 2012 and laying off all 170 workers, and now those workers are asking Mr. Romney to intervene with his colleagues to save their jobs.

“If he wanted to, all he needs to do is call up the management of Bain Capital and say, ‘Look, don’t do this,’ ” one worker, Tom Gaulrapp, told Reuters.

Mr. Romney had nothing to do with that decision…. Nonetheless, Mr. Romney remains deeply tied to business decisions like this. As Bain’s founder, he established its business model, which is to wring the maximum efficiency from a company for the benefit of Bain’s investors, even if that means closing plants, shipping jobs to China, and laying off American workers. That’s how private equity often works, and Bain has done it many times before, sometimes to the benefit of a company’s workers, and sometimes to their detriment.

If Romney is elected president, I expect we’ll see a lot more of these kinds of stories. Jesse Jackson wrote an op-ed about Sensata and the Romney economic model a couple of days ago: A taste of the Mitt Romney economy

Mrs. Dot Turner has worked at what is now Sensata Technologies in Freeport, Ill., for 43 years. The company does sophisticated work creating sensors for automobiles. It enjoyed record profits last year. But not enough for its owner — Bain Capital — which is moving the jobs and the machinery to China….

The Sensata workers called on Mitt Romney — an investor in Sensata through his Bain holdings — to intervene. A group went to Iowa during the primaries to ask him to come to Freeport; they met with no success. Another group went to the Republican convention to ask him to come to Freeport; they had no success, either.

So, with the open support of Freeport’s mayor and City Council, the workers set up a “Bainport” encampment in the Stephenson County Fairgrounds right across the street from the plant. “Welcome to Bainport, a taste of the Romney economy,” reads one sign. “Romney does have a jobs plan; too bad it’s for China,” reads another. And Mrs. Turner and others began to make their voices heard.

“We are suffering from the Bain model of capitalism,” Mrs. Turner said. “This is the way Bain works. They take over good companies, and then ship their jobs to China to make even more money.

“So when I hear Romney talking about creating jobs, he’s saying one thing and we are experiencing another. He’s creating jobs, but the jobs are in China, not here. And now under Bain, Sensata plans to give the managers and the supervisors their golden parachutes, but not the workers. I’ve been here 43 years, and they offer a lump sum payment for 26 weeks of salary. And the lump sum means taxes will take a big part of it.” Probably a bigger part than Romney pays in taxes on his income.

“We’re getting the shaft all the way,” Mrs. Turner continued. “And we’re not going to take it quietly. We can fight for our jobs. We may not win, but we are in their face. You may roll over me, but I’m not going to shut my mouth while you do it.”

The United Steelworkers Union has just released a video about what is happening in Freeport.

A few more resources on the Bain-Sensata story:

Democracy Now covered the story last Wednesday: As Bain Ships Jobs to China, Bainport Protesters Arrested for Blocking Illinois Factory’s Closure

Campaign for America’s Future: Is This Why Romney Won’t Talk To Sensata Workers Whose Jobs Are Being Shipped To China?

Crooks and Liars: ‘When I Hear Mitt Romney Speak it Makes Me Sick to My Stomach’

NY Daily News: Romney’s ‘Bain’ in the Neck

Please spread the word about this in any way you can. I’ll have another post on Romney’s China connections soon. Use the comments to discuss this story or anything else related to the 2012 election campaign. Thank you for reading this post!


Larry Summers And Another Luddite Analogy

A hattip to United Republic, their new site Republic Report and for this ‘most’ enlightening tidbit on Larry Summers.

This Larry Summers.

The Larry Summers that President Obama chose to head the White House National Economic Council, even after the blowback from Summers receiving beaucoup speaking fees in 2008 at banking meetings, as in JP Morgan dishing out $67, 500 for a February engagement.  This, after JP Morgan reaped $25 billion in Government bailouts.  Or Citigroup, another happy camper after receiving $50 billion in taxpayer monies, found enough spare change to pay Summers on two occasions, once for $45,000 and two months later for $54,000.  Or everyone’s favorite, Goldman Sachs. Sachs was really generous after receiving $10 million in bailout funds but managed a double decker of $135,000 for one appearance and another for $67,500 eight weeks later.

Oh, and Summers also had managed another $5.2 million, an easy-peasy salary from D.E. Shaw, which just happens to be a major hedge fund.

Who says government doesn’t work?

When Summers exited his WH duties, he hit the lecture circuit once again. His love of giving speeches seems to have slipped under the radar.  Until it didn’t.  Interest appears to have shredded the text of his presentation at a particular business forum.  Mysteriously, the stirring words disappeared and no one could retrieve then.  Poof!  But here’s what we know: this time Summer’s concluding keynote speech celebrated the wonders of outsourcing and off-shoring jobs.  Here’s a brief statement from the catalog introduction of the 2011 World BPO/ITO Forum:

Resisting the prospect of offshoring withholds a major totem of competitive parity from the most profitable producers of economic progress, Dr. Summers said. “It is to deny the US and American businesses an opportunity to participate in this revolution in emerging markets, which is the most important economic story of our time.” He added that increasing trade in tasks makes businesses more efficient and competitive, and allows them to exploit different skills, capacities and labor costs anywhere in the world. Critics who automatically label outsourcing or offshoring a threat to prosperity “resemble luddites who took axes to machinery early in England’s industrial revolution,” he said. Instead of killing jobs, as luddites feared, machines spawned millions of jobs and better standards of living.

Oh yes, I’m sure the majority of Americans now collecting unemployment or those working two, three jobs to pay the electric bill, buy the Kraft mac and cheese dinners in bulk, while hoping to God no one in the family gets sick could appreciate this finely-tuned statement.  But this statement [though applicable to many workers] was specifically directed to business process [as in payroll, tax and benefits] and IT workers—you know, all those geeky kids that were told ‘Go for the computer degree.  You can’t go wrong.’

Oops.

Because those innocent initials in the forum’s title?  That would stand for ‘business process outsourcing/information technology outsourcing.’

And people wonder why there are so many college grads with gargantuan school loans associated with the Occupy Wall St. Movement.  These grads are mad as hell and not getting over it.

But notice the analogy that Summers uses for describing critics of massive outsourcing of jobs, jobs, jobs.  Critics are Luddites, Summers says, no better than the extremists who smashed machinery during the early days of the Industrial Revolution.  I suspect there are ‘things’ citizens would enjoy smashing right now.  And it’s not the machines.

But here’s the word that flew out at me: exploit, as in exploitation:

an act or instance of exploiting<exploitation of natural resources> <exploitation of immigrant laborers> <clever exploitation of the system>

Ding, ding, ding!  We exploit our natural resources, our fellow citizens.  We exploit immigrant workers, every chance we get.  And we exploit the system by having people like Larry Summers, whirling through the revolving door of government/business, and then pretending the damage left behind is a good thing, the most important economic story of our time.

How about the biggest heist of all time!

But it gets better.  We get to exploit workers in other countries, too, making their lives so miserable they threaten to commit suicide en masse.

What’s not to love?

If this sort of thing wasn’t so sickening, it would be laughable.

I am not laughing.

Btw, the Republic Report site will be tapping none other than Jack Abramoff for an insider’s view of  DC corruption and influence peddling.  Super-lobbyist Abramoff, released from jail last year, will be a regular contributor to RR because if you want to catch a bunch of rats what better strategy than employ a King Rat?

Could get very interesting!


How Badly Does the World Need iPads?

Man poses as Apple's Steve Jobs at protest in Hong Kong

Are these gadgets really worth the sacrifice of workers’ lives? I admit I’m not an Apple enthusiast, but I don’t think so. Last year there was a series of suicides at Foxconn plants and on Friday, there was a fatal explosion at a Foxcomm iPad factory in Chengdu, China, that killed two workers and injured 15 others. Today a third employee died from injuries sustained in the blast.

Company officials said the explosion occurred on Friday May 20 in one of the polishing workshops at the factory, and that the initial finding of a joint investigation task force led by government officials and law enforcement authorities was that combustible dust exploded in a duct.

A little more detail from Mashable.com:

…the Chinese government in Chengdu has taken over the plant, censoring the information flow to the extent that local newspapers aren’t reporting about it.

With numerous workers committing suicide at the company’s Shenzhen-based iPad plant last year, Foxconn attempted to remedy the situation by giving them raises, but still needed to increase the production capacity to meet increasing demand. As a result, the new factory was built, an enormous eight-building complex hastily constructed in a record-breaking 70 days to accommodate the voracious demand for the iPad 2.

Soon after the factory was built…Apple’s inspection team visited the facility, taking two days to inspect the buildings, production lines and “especially the workers’ dormitories.” After its inspection, Apple approved the plant for manufacturing iPads.

After the suicides in 2010, the group Students and Scholars Against Corporate Misbehavior (SACOM) investigated the factories and produced a report (pdf) that documents the horrors of the working conditions in Foxconn’s factories.

According to the Sydney Morning Herald, the study found that slave labor-type conditions are still in effect at the factories. Workers are now forced to sign “no-suicide pacts,” and they are routinely humiliated by “military-style managers.” They may have to work as much as 100 hours of overtime per month, and are still not paid a living wage–they earn only about $186 per month. And Foxconn “routinely” fails to pay workers the correct amounts they have earned. This is after Apple visited the factories and approved the wages and working conditions!

Conditions at Foxconn’s two Chengdu factories, which exclusively produce Apple iPads, were among the worst reported. While nets have been installed to catch suicidal workers, factory staff are reportedly required to sign “no-suicide” pacts which also give licence to Foxconn to institutionalise them if it sees fit.

Workers at Chengdu say they are routinely humiliated and scolded by management. One was forced to stand in a corner with his hands behind his back because he giggled with a colleague. Others have been required to write confession letters to their supervisors after making mistakes and in some cases read the letters out in front of colleagues.

“Some of my roommates weep in the dormitory. I want to cry as well but my tears have not come out,” said 19-year-old Chengdu worker Chen Liming.

Ah Ming, 19, who produces cases for the iPad, said he stands for at least 14 hours a day. He wakes up at 7am to queue for the bus to the factory and it is 9pm by the time he returns home every evening.

The report also found that workers don’t

have adequate protections to safeguard against occupational health and safety issues such as aluminium dust and harsh reactions from chemicals used in the production process.

“I’m breathing in dust at Foxconn just like a vacuum cleaner. My nostrils are totally black every day,” one male worker said.

From the aptly named “Crave” blog at Cnet.com:

SACOM researchers visited Foxconn plants in Chengdu, where iPads are produced; in Chongqing, a smaller facility making mostly HP products; and Foxconn’s huge campus in Shenzhen, where half a million workers assemble a variety of computers, mobile phones, and additional products for Apple, HP, Nokia, Dell, and others. The researchers claim to have observed a number of problems at the Chengdu facilities in particular:

Workers do not have adequate training on usage of chemicals and do not have regular on-post health examinations. A number of interviewees even complain they suffer from allergy, but the management does not probe into the adverse health impacts of workers. Workers also highlight the problem of poor ventilation and inadequate personal protective equipment.

While SACOM notes the lack of ventilation as a possible threat to workers’ respiratory health, it appears that it may also have been a contributing factor to Friday’s explosion, which reportedly was centered in the “polishing” section of Foxconn’s facilities.

According to the report, the polishing department is filled with aluminum dust and there is inadequate ventilation.

Both aluminum and magnesium are commonly used ingredients in industrial polish–magnesium is a highly flammable metal used in fireworks, flares, and flash powder. A buildup of such dust due to improper ventilation could have created dangerous conditions.

I don’t know about you, but I’m very glad I don’t have an iPad, because if I did I’d be tempted to trash it right about now. If this is what it takes to produce a gadget that appears to be little more than a glorified cell phone that doesn’t do much other than provide entertainment and status to its users, I say it’s not worth it.