Over the course of the year, as Mitt Romney’s controversial private-sector background became more politically problematic for the Republican, many Americans became familiar with company names like GST Steel, Ampad, and Dade Behring.
But there are plenty of other names on the list. Sensata Technologies is quickly becoming one of the more notable, and this video, released last week, is worth your time.
Not surprisingly, Romney’s campaign has been eager to stress the fact that the candidate left Bain Capital several years ago, and is “not familiar” with Sensata outsourcing its American jobs to China. But it’s not that simple – the New York Times reported that Romney “owns about $8 million worth of Bain funds that hold 51 percent of Sensata’s shares. If Sensata saves money by closing the Freeport plant, that could add money to Mr. Romney’s trust accounts, now or after the election.”
What’s more, the Huffington Post reported that Romney personally benefited from Sensata and received a tax break from his shares.
While the workers and the town may suffer, Romney himself has done well as a result of Bain’s work with the company. According to his recently released 2011 tax returns, Romney transferred $701,703 worth of Sensata stock to the Tyler Charitable Foundation, a 501(c)3 tax-exempt nonprofit controlled by Romney…. Moving the stock to his nonprofit brings Romney twin benefits. First, he gets to deduct the full value of the stock. At a 35 percent tax rate, that’s nearly a $250,000 benefit. At 15 percent, it’s just over $100,000.
Second, Romney is able to avoid paying capital gains taxes on the stock price increase. Romney’s returns list no cost for the stock, and indicate he obtained them as part of a partnership interest in Bain. Avoiding capital gains taxes on the full increase would save an additional $100,000. In 2010, Romney gifted $170,000 worth of Sensata stock to his charity, saving $25,000 in capital gains taxes that year.
The Sensata controversy is serious enough that Republicans are actually trying to drag President Obama into this. No, seriously.
The Romney campaign and Fox News, perhaps fearful of where the Sensata story is headed, have begun arguing that Obama is personally invested in the Illinois company, so if there’s a controversy, it applies to both sides.
It’s awfully difficult to take this comparison seriously. On the one hand we have Mitt Romney, who owned Bain Capital, owns roughly $8 million worth of Bain funds that hold 51% of Sensata’s shares, and who got a tax break by transferring Sensata shares. On the other hand we have Barack Obama, whose state government pension fund invests in a wide variety of companies, including Sensata.
In the bigger picture, Bain-related controversies don’t seem to dog Romney on a daily basis the way they did earlier in the campaign, but this new controversy appears to be growing. It’s a story worth watching in the campaign’s closing weeks.