Romney's Job Creation Problem
Things certainly are getting hot in the presidential stakes these days. I'm disappointed by the sloppy rhetoric on free enterprise on the campaign trail. People taking Mitt Romney's "I like to fire people" comment out of context should be chided for it; and people criticizing Romney for firing generally are going overboard. But taken as a whole, this remains one more example of Romney making a poor defender of free enterprise. I have no idea why he's so bad at it, but just as he showed with the "corporations are people" moment, he has the ability to take a perfectly valid point of free enterprise and make it sound harsh or out of touch.
Yet the real problem here is one of Romney's own creation in casting himself as a private sector job creating machine, something he never should've done in the first place.
The central case Romney has advanced for his election is that he has a record of job creation in the private sector, and that this record equips him with the knowledge to put policies in place to foster more job creation. He has put himself forward as a turnaround expert, who can do the same thing for the country that he did for companies and the Olympics.
The problem for Romney is that his actual record of job creation is a complicated question – his aim at Bain was to return equity to investors, after all, not job creation. And he has hurt himself by making his accomplishments a quantifiable number instead of a general proposition. Where he once claimed he’d created 10,000 jobs, he now claims on the trail that he created 100,000 jobs – extending the timeframe for assessment out well beyond the point where he (and Bain) had little or no involvement in the respective companies.
Romney's problem is that he cannot have it both ways in the minds of voters. He can either count job losses in addition to job gains through 2011, or not at all. He cannot count the positive while ignoring the negative and expect to pass the smell test with anyone but his most devoted acolytes. Voters would find this as absurd as President Obama claiming he has created more than 2.5 million jobs, without noting any job losses under his administration. It's like a highlight reel for a football player, or a company saying you should only look at quarters where they were profitable... "We have a great record if you only look at the good stuff!"
As Jim Tankersley writes today (emphasis mine):
Mitt Romney has been in politics long enough to know that his record is intertwined with that of Bain Capital, the private-equity firm he cofounded. That’s why it’s so surprising that the Republican presidential front-runner is struggling to fend off his rivals’ attempt at a hostile takeover of his private-sector resume.
Every candidate runs on a record. Incumbent presidents run on the nation’s prosperity and security under their watch. Legislators run on the votes they’ve cast – on big bills and tiny amendments, on each “yea” and “nay” and … “present.” Businessmen run on their companies. Specifically, on every decision the company made while the candidate occupied a corner office. This surprises some neophyte candidates; in his losing bid for Senate in Colorado in 2004, brewing magnate Pete Coors, an outspoken gay-marriage opponent, was shocked when his opponents noted gleefully that Coors Brewing was sponsoring a weeklong gay pride event featuring a fetish ball and nude male review.
Attacks on a business record shouldn’t surprise any candidate this year, when anger at Wall Street and government bailouts of the financial sector have animated activists on the left (Occupy Wall Street) and the right (the tea party) alike.
Frankly, I think it was foolish for Romney to advance this "job creator" claim in the first place. It forces him to make an argument for Schumpeterian creative destruction in the midst of a nomination fight he has every likelihood of winning. He could have instead stuck to a more general argument, advancing the idea that he was a creator not so much of jobs but of wealth and prosperity, that he took some risks that worked and some that didn’t, and that he now understands what makes businesses work and how to avoid failure through a long private sector career.
That's an argument that is far more difficult to rebut than getting into a numbers game... particularly one Romney is likely to lose, at least in the minds of job-focused voters.
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Jun '10
Re: Romney's Job Creation Problem
Romney ran Bain Capital between 1984 and 1999. As I recall, if you got fired in those years, you had a pretty good job market to go to. That should be part of the equation too. But today, if you fire someone, you're sending them out into a whole different world.
Re: Romney's Job Creation Problem
A fair point.
Again, I think some of this Bain criticism is going overboard. But Romney is staking his campaign on being a private sector job creator. If that claim turns out to be false, pointing out this fact is hardly anti-capitalist.
Jul '10
Re: Romney's Job Creation Problem
I can't like this post enough.
Nov '10
Re: Romney's Job Creation Problem
He really needs to get away from all of this and stress two important points that are (should be) big sellers with the Republican (& independent) electorate: 1. He us an effective executive who knows how to run a large organization and get things done through others. 2. He has always been a fiscal conservative (mulligan on Romneycare, of course). Just my $0.02. Thanks for the post, Ben. Thoughtful as usual.
Mar '11
Re: Romney's Job Creation Problem
Hypothetical: You are a candidate who earned millions of dollars in the private sector and are now running for President in a year in which millions of Americans are out of work and against a President who has only worsened and prolonged a recession. You are running on your economic expertise as demonstrated in the years in which you ran a largely successful investment firm.
How is it, given everything I've just said, that the very first thought in your own mind, and in the minds of the people who are paid political consultants who are running your campaign, isn't: "Okay, guys, we're running on my economic record in a year when many Americans are struggling. We need to take a look at the record at Bain and examine the businesses we tried to rescue but couldn't and have answers ready to go as to why they went under and why people got laid off ready to go--because the opposition is going to paint us as spoiled rich kids who screwed the little guy. We have to make sure we have answers that aren't callous on this one."
It took Avik Roy a day.
Sep '10
Re: Romney's Job Creation Problem
Whoa, wait a minute here! You're suggesting that a guy who lost all but one of his elections isn't doing a good job getting his message out or defending his record? Who could have expected that?
Good thing we've got the Republican establishment to drag him across the nomination finish line so he can take on a polished, $800M Obama re-election machine and it's attendant MSM sycophants.
Dec '10
Re: Romney's Job Creation Problem
Perfect, Ben. Appearance will trump reality when it comes to Romney's Bain experience, and it will be exceptionally easy to paint a picture of Bain Capital as evil rather than good. This may be the worst analogy ever, but his work at Bain is a lot like Honey Bucket: good and necessary, but not a hit topic of conversation in polite (or politic) conversation. Romney's other main problem is that his political experience suffers from the same ease of distortion. He may have done great things as governor of Mass, but every accomplishment is eclipsed by Romneycare.
To frame his problem in a horrible joke: you can build a thousand bridges and no one will say, "look! there goes Tom the bridge builder," but you have sex with one goat...
Dec '10
Re: Romney's Job Creation Problem
Why is any Republican talking about private sector job creation in the context of trying to become chief executive of the government? Is the government a tool to be wielded by one or the other party to aid in free-market enterprise? No!
This is what I want our nominee to do. If the government is a tool in relation to the economy, it's a wrecking bar. Let's put it in a wall-mounted case (of Constitutional dimensions), with a sign on the outside reading, "Break glass in case of emergency." And then let's throw away the hammer.
We don't need a businessman, successful or otherwise. We need an originalist reformer. Is Romney going to get government out of the way, or hand-pick conservatives' preferred winners and losers?
Sep '10
Re: Romney's Job Creation Problem
This is the candidate the Republican establishment wants. That says all any conservative needs to know about Romney and the GOP. Romney says elect me, look what I did at Bain. His opponents begin looking at what he did at Bain and the GOP establishment says they are not being fair. Anyone know the name of a good third party?
Dec '10
Re: Romney's Job Creation Problem
No.
Jul '10
Re: Romney's Job Creation Problem
There's this article which is perhaps the most well-reasoned and not hysterical treatment of Romney and Bain Capital.
Jun '10
Re: Romney's Job Creation Problem
The Republican establishment wants Romney, and the Democrat establishment wants a Libertarian third party (Ron Paul?) Maybe both establishments will get their wish.
Dec '10
Re: Romney's Job Creation Problem
Thank you.
Aug '10
Re: Romney's Job Creation Problem
Two points I haven't seen anyone make yet;
Jun '10
Re: Romney's Job Creation Problem
Frozen Chosen: Two points I haven't seen anyone make yet; · Jan 10 at 11:54am
When I was in high school, I bought two junked Ford Falcons. One had body damage, but a near mint engine and transmission, and the other one had an unblemished body with a seized up engine. What do you suppose I did? Romney just did the same thing on a much bigger scale.
Dec '10
Re: Romney's Job Creation Problem
Bravo! That's exactly what I've been saying.
Dec '10
Re: Romney's Job Creation Problem
etoiledunord
Frozen Chosen: Two points I haven't seen anyone make yet; · Jan 10 at 11:54am
When I was in high school, I bought two junked Ford Falcons. One had body damage, but a near mint engine and transmission, and the other one had an unblemished body with a seized up engine. What do you suppose I did? Romney just did the same thing on a much bigger scale. · Jan 10 at 12:05pm
What did you do with the pieces you couldn't use?
Apr '11
Re: Romney's Job Creation Problem
Ben's post is partly "Romney tells the truth, but in an awkward way". I'm not sure that he's doing so badly as a politician; he's moved a lot of TEA Party types his way in the last few days. Still, arguable point.
He also says "and maybe the lies are true", suggesting eg. that Romney's netting of gains and losses counts only the gains. This is obviously untrue, defamatory, and disgusting, coming from someone who knows better.
It leads him to suggest that a defense of capitalism as job creating is hence unwise.
Dec '10
Re: Romney's Job Creation Problem
James Of England
Ben's post is partly "Romney tells the truth, but in an awkward way". I'm not sure that he's doing so badly as a politician; he's moved a lot of TEA Party types his way in the last few days. Still, arguable point.
He also says "and maybe the lies are true", suggesting eg. that Romney's netting of gains and losses counts only the gains. This is obviously untrue, defamatory, and disgusting, coming from someone who knows better.
It leads him to suggest that a defense of capitalism as job creating is hence unwise. · Jan 10 at 2:49pm
Does Romney feel uncomfortable laying the whole of Bain's business before the world to be examined? Probably. What business wants that? However, if he wants to make his work at Bain the hallmark of his campaign he cannot then make it off limits to examination. You're a lawyer; you understand that once something is brought into evidence it is available to scrutiny by both the plaintiff and the defendant.
Jun '10
Re: Romney's Job Creation Problem
Stuart Creque
etoiledunord
Frozen Chosen: Two points I haven't seen anyone make yet; · Jan 10 at 11:54am
When I was in high school, I bought two junked Ford Falcons. One had body damage, but a near mint engine and transmission, and the other one had an unblemished body with a seized up engine. What do you suppose I did? Romney just did the same thing on a much bigger scale. · Jan 10 at 12:05pm
What did you do with the pieces you couldn't use? · Jan 10 at 2:35pm
After a truck ride to the scrapyard, they got a new job. They may be working for you now. Who knows?