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Truth Test: Obama claims Romney is not tough on China

7:32 PM, Oct 5, 2012   |    comments
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Jobs and the economy have been the major issue in the presidential campaign. The airwaves have been flooded with ads from President Obama and Mitt Romney, but are the ads true? Phil Amato puts them to the Truth Test.

I'm Barack Obama and I approve this message.

These appliances could have been made here in America, but a company called global tech maximized profits by paying its workers next to nothing under sweat shop conditions in China.

Stop right there. This claim is half true.
    
The reason: Global Tech Appliances is based in China, according to a Boston Globe report which the ad cites.
    
While the company makes appliances for American companies including Revlon, Hamilton Beach, and Florida-based Sunbeam -- according to the Institute for Global Labour and Human Rights -- the workers making those appliances were always meant to be Chinese because of Global Tech's base location.

When Mitt Romney led Bain, they saw Global Tech as a good investment.

This claim is mostly true. This part of the ad refers to a 1998 investment document discussed in the Boston Globe article.
    
It says Global Tech Appliances used quote "inexpensive labor" and that it's location in China meant quote "an overall effective tax rate that may be less than that of U.S. Corporations."
    
But Bain Capital was not the main investor to Global Tech Appliances.
    
The Boston Globe, citing the Securities and Exchange Commission, said Brookside Capital Partners Fund bought about 6 percent of Global Tech Appliances.
    
Mitt Romney was listed as the only shareholder, director, President and CEO of Brookside.
    
Romney was also the founder and CEO of Bain capital.
    
While Bain Capital was affiliated with the investment of Global Tech Appliances, it was not a direct investment.

Even knowing that the firm promoted its practice of exploiting low wage labor to its investors.

This claim is partially true.
    
The Institute of Global Labour and Human Rights finds Global Tech Appliances employed five thousand women at its plant in Guangdong China.
    
Those workers earned 24 cents an hour.
    
But it's unclear if Mitt Romney knew the wages being paid to the workers.

Mitt Romney, tough on China: Since When?

The last of the line of the ad is misleading because a June analysis by Factcheck.org finds the three other Chinese factories the Obama campaign has highlighted in its ads as an example of Romney's outsourcing were all bought by Bain after Romney left.
    
Mitt Romney took a leave of absence in February 1999 and never returned.
    
The Boston Globe reports Bain Capital sold its investment in Global Tech in August 2000.

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