CHICAGO (AP) - First it was allegations of nursing home resident neglect. Then an admitted serial fraudster on a retirement funds board. Now it’s companies outsourcing jobs overseas.
Locked into one of the nation’s closest gubernatorial races, Gov. Pat Quinn is focusing on a key theme as he tries to keep venture capitalist Bruce Rauner from becoming the first Republican in more than a decade to run Illinois: picking apart Rauner’s private equity firm investments and how he made hundreds of millions of dollars.
The tactic, used to portray Rauner as a heartless multimillionaire, mimics President Barack Obama campaign’s portrayal of another businessman - Republican presidential nominee Mitt Romney in 2012. But political analysts said the strategy has risks, including that it’s tough to tie Rauner directly to company decisions and that the move could anger the business community.
“It’s an indirect way of arguing that this candidate is out of touch with the voters,” said Nathan Daschle, the Democratic Governors Association’s former executive director. “But you do have to be careful that you’re not sending a message that success is a bad thing.”
Rauner has defended his accomplishments and business record. But Quinn’s campaign is now questioning other companies linked to Rauner’s investment firm GTCR, pointing out details to The Associated Press that were confirmed by company statements, news reports and Rauner’s campaign.
Among those was a business processing outsourcing company formerly known once as H-Cube. GTCR formed it in 2005. H-Cube acquired other companies and merged, eventually employing thousands of people in India and the Philippines under a Pennsylvania company named Zenta, which Accenture acquired in 2011.
Quinn’s campaign says GTCR’s profits hinged, in part, on shipping American jobs overseas.
“Time and again, we’ve seen billionaire Bruce Rauner profit while workers and the most vulnerable got the shaft,” said Quinn campaign spokeswoman Izabela Miltko. “Rauner has said he wants to run our state like a business. We just hope not like one of his businesses.”
Rauner campaign spokesman Mike Schrimpf called the Quinn campaign’s spotlight on the outsourcing companies a “desperate” attack that wasn’t surprising in light of Quinn’s “failures.” GTCR’s business dealings span decades, including managing money for state retirement funds. Rauner was chairman until stepping down in 2012.
“GTCR is one of the most respected investment firms in the country,” Schrimpf said, “which is why it has been trusted for years to oversee the retirement investments of Illinois teachers and state workers.”
Political strategists say Quinn’s tactic could work in Rauner’s favor.
Republican strategist Doug O’Brien said it’s hard to show Rauner was directly connected to the business dealings. And he said Quinn faces more troubling problems - a federal lawsuit alleging patronage hiring and investigations of an anti-violence program.
“If they are going to say that it reflects on the character of Bruce Rauner, then wouldn’t it be equally fair that the activities directly under the governor would reflect on his capability of governing the state?” he said.
Quinn says Illinois is better off under his tenure after his two consecutive predecessors were convicted for corruption. In seeking a second full term, he’s tried to convince voters he’ll promote middle-class concerns. Quinn has also said he confronted concerns about patronage hiring and the anti-violence program early on.
“He has cleaned up an absolute mess that he inherited,” Democratic Governors Association spokesman Danny Kanner said.
Democrats have tried to liken Rauner to Romney, who was targeted by Obama’s re-election campaign with allegations that private equity deals led to job losses and outsourcing overseas. But that angered some business executives and wasn’t popular with all Democrats, including former President Bill Clinton.
The same could happen in Illinois, where Rauner has been endorsed by such prominent Democrats as former Federal Communications Commission Chairman Newton Minow.
“We’re smothered by debt. We’ve got huge unemployment. We’re not growing,” Minnow said, explaining that a businessman could help Illinois. “The basic problem is bitter partisanship.”
Opponents have highlighted the fact that Rauner’s business dealings aren’t part of the public record because his company is private. And they have questioned how Rauner made a large fortune, millions of which he’s put into his campaign.
The issue first cropped up during a four-way primary campaign. Union-backed ads alleged a GTCR-founded company drained money from nursing homes, causing residents to suffer. Challengers also tried to connect Rauner to Stuart Levine, who pleaded guilty to money laundering and fraud in ex-Gov. Rod Blagojevich’s corruption scandal. Levine was on a state retirement system board and reportedly made money from a company partly owned by GTCR while the company was soliciting state pension business.
Rauner has said the allegations are political.
Follow Sophia Tareen at https://twitter.com/sophiatareen .
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