Obama camp: Attack on Romney isn't an attack on private equity industry

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(CBS News) President Obama has had a somewhat rocky relationship with Wall Street over the course of his first term, and his re-election campaign opened a new line of attack against Mitt Romney today for his work as a corporate titan at a private equity firm. His campaign, however, has emphatically emphasized that it's attacking Romney's career specifically and his economic values -- not the private equity industry overall.

"No one is challenging Romney's right to run his business as he saw fit, and no one is questioning the private equity industry as a whole. That's not what this is about," Stephanie Cutter, deputy campaign manager for Obama for America, told reporters Monday. "This is about whether the lessons and values Romney drew from his time as a buyout specialist -- what those values are, what they tell us about what type of President Mitt Romney would be, and whether the voters want that in the Oval Office."

The Obama campaign on Monday rolled out a multi-pronged attack on Mitt Romney's record as the head of Bain Capital, the private equity firm he founded. The attack includes a two-minute television ad that will air in five battleground states, focusing on the story of GST Steel, a Kansas City plant that Bain Capital purchased and subsequently shuttered after more than 100 years of business.

Romney has touted his work at Bain as an example of his business expertise and understanding the economy. The line of attack is a delicate one for the Obama campaign, given that by industry standards, Bain Capital has been a strong performer.

Steven Rattner, Mr. Obama's former car czar, said on MSNBC this morning that the Obama campaign's new ad is unfair.

"Bain Capital responsibility was not to create 100,000 jobs or some other number. It was to create profits for its investors, most of whom were pension funds and endowments and foundations," he said. "And it did it superbly well, acting within the rules, acting very responsibly, and was a leading firm. And so yeah, I do think to pick out an example of somebody who lost their job, unfortunately, this is part of capitalism, this is part of life, and I don't think Bain Capital did anything they need to be embarrassed about."

Even Cutter acknowledged today that Bain is a successful company.

"Bain was and continues to be a very prominent firm," Cutter said. There were some instances, however, in which the company under Romney's leadership "made wrong decisions for long-term economic growth and the wrong decisions for workers invested in those companies," she added.

Once again, Cutter stressed, "At the end of the day this isn't about private equity. Romney says there are winners and losers -- absolutely. But at the end of the day, his partners always won, and somebody else was left holding the bag."

The Romney campaign has pointed out that the layoffs at GST Steel and its bankruptcy happened in 2001 -- two years after Romney gave up running Bain Capital to run the Salt Lake City Olympics.

Cutter said today that it was fair to attack Romney for the management of GST Steel because "he set this in motion. It was his structure that put this in place." She noted that he was still listed as CEO of the company and was "still making profits off of this deal."

The private equity industry has been actively defending itself against negative perceptions in wake of Bain attacks, which started during the Republican primary. The Private Equity Growth Capital Council earlier this year launched the website PrivateEquityAtWork.com, and last week it released a video called "What is Private Equity?"

Ken Spain, a spokesman for the industry group, told Hotsheet that the renewed focus on private equity was to be expected as the general election got under way. "But what is lost in the politically-charged debate is the fact that private equity has pumped hundreds of billions of dollars into the U.S. economy, supporting and strengthening tens of thousands of businesses in all fifty states," he said.

While the Obama campaign insists it's not attacking the industry, the fundraising numbers suggest industry insiders aren't buying it: Democrats received the majority of the industry's donations in 2008, but this year, the money is going to Republicans.

Mr. Obama may try to turn that around today, when he heads to a $35,800-per-head fundraiser in New York City -- a campaign official confirms to CBS News the fundraiser will be hosted by Tony James, president of the private equity firm Blackstone.

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