The answer is tantalizingly close and yet just out of reach. An interested reader can find some of the relevant information here, in a Deutsche Bank prospectus for potential investors in Bain Capital. On pages 16 and 17, the prospectus lists all the investments made by Bain Capital from 1984-1998, roughly the time that Mitt Romney ran the company. For example, their 1984 investment of $2 million in Key Airlines led to an annual return of 52.9%. It does not tell you how much money investors made because you would have to subtract off Bain’s fees which this Table does not have (other parts of the prospectus may help you to do that). The thing that is impossible to work out is the employment impact of Bain’s investments. The prospectus does not say anything about that issue. But the names of the companies are listed in the left hand column. So, it might be possible to work out what happened to these companies via a web search and come up with some answers.
If someone had the time and the ability to do that, it would be very interesting I think. I’d certainly be interested in the answer.
9 comments
Comments feed for this article
February 9, 2012 at 7:29 pm
Kevin
if it was easy to obtain reliable numbers, I’m confident the WSJ would’ve picked it up in last month’s article on Bain, which cited the same DB prospectus. Otherwise I’d think the NYT would’ve lept in
http://online.wsj.com/article/SB10001424052970204331304577140850713493694.html
March 20, 2014 at 6:57 am
Jen
asdfasdf asd fasdf asdfsadfasgdfsg sdfg sdfg
March 21, 2014 at 2:27 am
Jen
cvn dgh cmfghjgfhjghj
March 21, 2014 at 5:24 am
Somchat
Appreciating the persistence you put into your wesibte and in depth information you provide. It’s great to come across a blog every once in a while that isn’t the same outdated rehashed material. Great read! I’ve bookmarked your site and I’m including your RSS feeds to my Google account.
February 9, 2012 at 8:26 pm
Nathan Sumrall
How do we account for jobs he may have saved. If Bain takes over a company and fires 1/3 of the workforce, but the company remains operational where it may have folded completely w/o the investment, how do we score Bain’s impact on jobs? Maybe he saved 2/3 of the workers by sacrificing 1/3, in which case he “created” jobs. But how can we know this?
We need some way to calculate the expected job loss if Bain had not intervened.
February 10, 2012 at 8:05 am
Sandeep Baliga
Nathan: Great question. Here is a paper that attempts to do answer the question you pose:
http://faculty.chicagobooth.edu/steven.davis/pdf/privateequityandemployment.pdf
They have employment data from the US Census but it is highly secret hence not split off by firm.
February 10, 2012 at 8:33 am
jamesoswald
Zero, because prices adjust in the long run!
February 10, 2012 at 12:40 pm
anon
What is the counterfactual? Bain not taking over these companies? Romney not working at Bain?
February 10, 2012 at 7:28 pm
ed
In the long run, the number of jobs is determined by the number of workers. Asking “how many jobs” Romney created is the wrong question; we should ask how much value he created. Economists, of all people, should refuse to engage in this meaningless and misleading argument over jobs created, and point out that what matters is productivity and economic growth.
Argument made earlier and in more detail here:
http://modeledbehavior.com/2012/01/28/jobs-and-the-economy-in-the-long-run/