President Barack Obama’s second-largest fundraiser owns a large stake in America’s number one outsourcer.
John Rogers, CEO of investment giant Ariel Capital Management, has raised more than $1.5 million for Obama’s reelection campaign. Rogers’s firm also owns a $48.6 million stake in Accenture, the nation’s “best” outsourcer, according to the International Association of Outsourcing Professionals.
Rogers is now looking to break new ground in the world of outsourcing, in order to enhance his company’s $21 billion portfolio. In an interview with Forbes, Rogers expressed his desire to blaze the trail from moving call centers and factories overseas to outsourcing “day-to-day activities” including pest control, landscaping, and secretarial functions.
“We’re making a very big bet right now on outsourcing,” he said. “People have generally soured on the idea, and many companies are trading at discounts to their private-market values. But we don’t think that view accurately reflects the powerful secular growth we’re going to see as companies and individuals outsource more of their day-to-day activities.”
Rogers comes from Obama’s adopted hometown of Chicago, where the two families enjoyed a close relationship. His ex-wife Desiree left a $350,000 per year job at Allstate Insurance Company to serve as White House party planner.
Outsourcing has taken center stage on the campaign trail after Obama blasted Republican nominee Mitt Romney as an “outsourcer in chief” for Bain Capital’s investments in companies that moved jobs overseas.
Obama’s largest bundler, DreamWorks CEO Jeffrey Katzenberg, bundled $2 million for the campaign and co-hosted a $10 million Hollywood fundraiser in May. Vice President Joe Biden was involved in Katzenberg’s efforts to create jobs overseas via expansion of studio and distribution operations in China—efforts that have since landed DreamWorks at the center of an SEC corruption investigation.
Other outsourcing champions have the president’s ear when it comes to jobs policy.
The president appointed General Electric CEO Jeffrey Immelt to lead the White House Jobs Council. GE became the third-largest company in the world under his watch, as the company shed more than 34,000 American jobs, while adding 25,000 foreign workers to its payroll.
GE did not stop outsourcing after Immelt assumed his post. In July 2011, the company moved its Wisconsin-based x-ray division to China, displacing 150 workers and creating 65 new foreign jobs.
Romney countered the Obama campaign’s attacks by accusing the president’s poor economic policies of speeding up outsourcing. His campaign “pointed [reporters] to an April 26 Wall Street Journal story headlined ‘U.S. Firms Add Jobs, but Mostly Overseas’ in an attempt to put the Obama campaign on the defensive,” according to NPR.
The green energy agenda at the center of the stimulus and energy loan programs have helped to shift billions in American capital, as well as hundreds of jobs, to overseas companies. The Obama team has even bragged about the jobs from such loans in a campaign ad criticizing Romney’s record at Bain.
The “clean energy initiatives” featured in the ad include three taxpayer-guaranteed loans to Spanish clean energy conglomerate Abengoa worth $2.78 billion to create 195 permanent jobs—more than $14 million per job—as well as a $529 million loan guarantee to Fisker Automotive, a fledgling company that manufactures $100,000 electric cars in Finland and is now teetering on bankruptcy.
The Department of Energy also awarded nearly $6 billion in taxpayer-guaranteed loans to the Ford Motor Company, which is rapidly expanding its operations outside of the United States.
Ford is not the only motor company that has used taxpayer dollars to expand its overseas operations. GM moved forward with plans to build cars with cheap labor in China and Mexico and import them to the United States for sale in 2009 after Obama awarded the company $50 billion in taxpayer dollars. The administration later granted the company $45 billion in tax breaks that allowed the company to pay no income tax in 2011, despite taking in a record $7.6 billion profit.
Foreign-controlled companies collected $1.7 billion of the green energy grants issued by the stimulus, compared with $500 million for domestic operations, thanks in part to China’s cheap labor and that nation’s control of 95 percent of the rare earth materials used in the creation of energy-efficient products such as light bulbs.
The energy-efficiency focus has led to job losses in swing states, such as Virginia. The administration’s push for more energy-efficient light bulbs led GE to close its largest manufacturing plant in Winchester, Va., leaving 200 laborers in one of the poorest parts of the state out of work.
Romney railed against Obamacare and the president’s handling of the economy during a visit to technology companies in Virginia on Wednesday. The message may be catching on, as a new poll found that he led Obama by 5 points in a state the Democrat carried by 7 points in 2008.