Cronyism and outsourcing: Romney, Obama trade jabs

CINCINNATI – Using unusually vivid language, Mitt Romney tried to take the political offensive against President Barack Obama on Monday, accusing Obama of cronyism that "stinks" in steering federal contracts to supporters. He also dropped hints through a spokesman that a vice presidential pick could come any day.

Unfazed, Obama needled his Republican rival for finally having a job-creation plan — for people overseas.

At the same time, though Romney endeavored to switch the campaign focus, questions about his tenure at Bain Capital, a venture capital company, seemed destined to shape the conversation at least a while longer. On a day devoted mainly to raising money, Romney went on Fox News to complain that all Obama can do "is attack me" on Bain and other subjects rather than taking useful steps to improve the economy.

Sure enough, the Democratic incumbent showed no sign of letting up.

Rallying for support in crucial Ohio, Obama said Romney's proposal to free companies from taxes on their foreign holdings would displace American workers. The president cited a study he said concluded that "Gov. Romney's economic plan would in fact create 800,000 jobs. There's only one problem, the jobs wouldn't be in America."

Romney's campaign, itself moving to the attack, contended that Obama's Energy Department has steered loans and grants to several companies connected to the president's political supporters.

Romney, speaking to donors in Baton Rouge, La., said Obama had a policy of "taking your tax dollars and putting it in businesses owned by contributors to his campaign. And that is smelly at best. It stinks."

Romney aides cited some well-known cases, such as Solyndra, a California solar energy company that went bankrupt, and some less-publicized cases. They include Westly Group, a venture capital firm whose affiliated companies have received federal loans and grants.

Steve Westly, the company's founder, is a major Obama campaign fundraiser.

Obama campaign spokeswoman Jen Psaki said the Energy Department's decisions "were made without regard to political connections." She said some grants have gone to projects with "just as robust connections to Republican campaigns and donors."

While Obama held a freewheeling town hall in Ohio, Romney raised money in the safely GOP states of Louisiana and Mississippi.

Addressing another major election point of interest, top Romney adviser Eric Fehrnstrom told The Associated Press that the campaign may announce a vice presidential choice by the end of the week. That would be sooner than many have expected, and some Democrats suggested it was another effort to turn attention from Bain.

The timing was far from certain. Asked whether the announcement could come this week, Fehrnstrom said: "Technically it could, but the governor hasn't made a decision."

The past several days of the campaign have centered on Romney's former work at Bain Capital and whether he has been straightforward about the timing of his departure, a line of attack that Obama is exploiting to try to undermine public support in Romney's business credentials and trustworthiness. Obama assailed Romney's tax plans for U.S. businesses on Monday.

At his Ohio event, Obama cited an article in the publication Tax Notes suggesting Romney's tax proposals would encourage U.S. companies to create up to 800,000 jobs overseas. Romney supports "a territorial tax system," which would allow overseas profits made by U.S. companies to avoid federal taxation.

Romney's campaign cited campaign disclosure reports showing that the article's author, Reed College economist Kimberly A. Clausing, has donated money to Obama's campaign. Republicans say Romney's overall tax proposals would encourage greater job growth at home.

Romney "has a comprehensive plan to reform the corporate tax code that will lower rates, get rid of incentives for firms to create jobs in other countries, and encourage the kind of economic growth President Obama has been unable to deliver," said campaign spokeswoman Amanda Henneberg.

For all the tax talk, the presidential campaign couldn't seem to shake Bain, the company that Romney led in the 1990s to numerous successful corporate restructurings, and to some less happy ventures that ended in bankruptcy or other problems.

Romney has said he left Bain in early 1999, shortly before it invested in companies that were pioneers of job outsourcing. Romney says he played no role in those transactions and decisions.

Two years later, however, Bain was still filing disclosure documents with the Securities and Exchange Commission that named Romney as the firm's CEO, president, sole shareholder and "the controlling person." At least one document in early 2001 said Romney's "principal occupation" was as Bain's managing director.

Bain says it took some time for disclosure forms to catch up with management changes at the firm. Romney says he was working fulltime on the Winter Olympic Games starting in early 1999. Democrats say Romney has yet to satisfactorily explain.

Romney traveled to Louisiana to attend a private fundraiser alongside Louisiana Gov. Bobby Jindal, who is among those on Romney's short list for vice president. Romney raised an estimated $2 million at the event, where 40 donors paid $50,000 to attend.

Jindal has been campaigning aggressively for Romney in recent weeks, as have others thought to be under consideration. They include Ohio Sen. Rob Portman, former Minnesota Gov. Tim Pawlenty, Wisconsin Rep. Paul Ryan and Florida Sen. Marco Rubio.

Obama raised at least $625,000 at his own fundraiser at the Cincinnati Music Hall before his public appearance.

While Romney and pro-Republican "super PACs" are raising huge sums, campaign laws place limits on how much Romney can spend before the late-summer nominating conventions take place. Meanwhile, Obama has outspent Romney in some key states.

___

Steve Peoples reported from Baton Rouge, La.