Private equity took a beating during the 2012 presidential campaign, when Democrats portrayed the partners at Bain Capital, the Boston PE firm co-founded by Republican candidate Mitt Romney, as a pack of job-cutting corporate raiders. Now, some are trying to paint Mike McFadden with the same brush. The Republican investment banker who calls Minnesota home is making a bid for the U.S. Senate seat held by Democrat Al Franken.
Before he entered politics, Franken was perhaps best known for portraying Saturday Night Live’s amiably pathetic self-help guru Stuart Smalley, whose wishful-thinking-filled motto was: “I’m good enough, I’m smart enough, and doggone it, people like me.”
But it’s McFadden’s former life as a middle-market investment banker that is in the spotlight. “For more than 20 years, Mike helped grow a company, now known as Lazard Middle Market, from a dozen employees in one office to more than 100 employees in offices around the world,” says the bio on McFadden’s campaign website. “Lazard Middle Market works with small and medium sized companies to help find new ownership to continue to grow and create jobs.”
But some groups have been steering journalists to deals worked on by Lazard and Goldsmith Agio Helms (where McFadden worked before Lazard bought the investment bank) that resulted in job losses, says Brett Neely, a reporter who covers the Washington, D.C., beat for Minnesota Public Radio News. The Alliance for a Better Minnesota points out that the sale of Kid Duds, which Goldsmith helped sell in 1995, resulted in the new owners moving production to Mexico and laying off workers in Minnesota.
“We don’t make any operational decisions,” says McFadden. “We would never advise a business to lay off employees. That’s not the scope of our engagement, that’s not our experience set.”
McFadden says his opponents “don’t understand the economy. They have no idea what I do, and it’s unfortunate.”
The more important question for McFadden is, will voters understand his image of business leader, education supporter and middle-class family man? Doggone it, will people like him?
At the end, write For more on the race, see the MPR News story, “Who is McFadden? Partisans rush to define GOP Senate hopeful,” and the Bloomberg story, “Republicans Turn to Lazard Banker to Topple Al Franken.”