Romney's record at Bain Capital: Does it matter?

Walter Shapiro
Georgie Anne Geyer

The issue will be the bane of our existence until November. Here it is only May—and the back-and-forth over Mitt Romney’s career in private equity at Bain Capital is already as confused as Facebook’s initial stock offering. Buffeted by TV ads, Web videos, feigned outrage and zigzagging Democrats, voters undoubtedly are stunned by the sudden outbreak of high-decibel arguments over Romney’s business career.

But do these even matter? Amongst the background noise emerges the real question: What parts of Romney’s business experience would influence his actions in the Oval Office? That is a central question that voters should evaluate, although finding the answers will not be easy given the frenzied spin from both sides.
The brickbats began last week with Barack Obama’s first major ad buy of the campaign featuring a displaced steelworker calling Bain a vampire “that sucked the life out of us.” A Romney response video asked, “Have you had enough of President Obama’s attacks on free enterprise?” Newark’s Democratic mayor, Cory Booker, was featured in the Romney ad because he described the blame-Bain game as “nauseating” on “Meet the Press.” Then Booker released his own video saying, in effect, that he was for the Obama attacks after he was against them. The Republicans came back with a video suggesting that the Obama campaign pressured Booker into recanting.

Next we had the pro-Obama super PAC ad ... nah, there is too much to summarize. But a few obvious questions spring to mind: Why in the midst of a presidential campaign do we care so much about what Booker, or any New Jersey mayor, thinks about private equity firms? How many campaign-issued Web videos will it take to drive the political press corps bonkers? In the old days (around 2004), campaign ad-makers had to pull an all-nighter to put rapid-response TV spots on the air. Now it takes a junior press staffer maybe seven minutes to patch together a video. Is this really progress toward a more perfect democracy? And most importantly, how relevant is the Romney record at Bain Capital (and the $200-million-plus he made swapping companies) to his actually serving as president in 2013? Do the Bain years reveal that much about how a President Romney might react to a sputtering economy or a euro crisis?

[Related: Election about Obama's economic record, not Bain]

Romney’s passionate responses to attacks on his business record during the Republican primaries seemed genuine rather than gimmicky. (For the most part, Romney lacks that essential political gift of faking sincerity.) “I will not apologize for being successful,” Romney declared during a late January debate in Florida. He quickly added, with awkward syntax, “The nature of America is individuals pursuing their dreams don't make everyone else poorer—they help make us all better off. And so I’m not going to apologize for success or apologize for free enterprise.”

Beyond the three-cheers-for-capitalism rhetoric, three things unquestionably shaped Romney’s life: his Harvard MBA, his early years as a business consultant for Bain and his tenure at the helm of Bain Capital, the private equity spinoff from the firm. For all of Romney’s lionizing of the risk-taking visionaries of the business world, he was initially nervous about leaving the security of business consulting to start up Bain Capital. As Boston Globe reporters Michael Kranish and Scott Helman reveal in their biography "The Real Romney," “He didn’t want to risk his position, earnings and reputation on an experiment. ... Romney worried about the impact on his reputation if he proved unable to do the job.”

[Related: Obama losing votes to another 'candidate']

But Romney’s late-night brooding proved unnecessary. In financial terms, Bain Capital under Romney’s reign was wildly successful, averaging an 88 percent annual return over 15 years. Campaign spokesmen and hired-gun economists on both sides will wrangle eternally over Bain’s job creation record from its investments in successful startups like Staples to closed-factory-gate failures like the Missouri steel mill featured in the initial Obama ad. But either way, this is retroactive scorekeeping like ranking baseball teams based on hot-dog sales rather than games won. What mattered at Bain Capital was the bottom line. Everything else was an extraneous detail and, in the case of job loss, collateral damage.

This is who Romney is—a portrait in business success rather than selfless altruism. Coming out of that experience, Romney’s underlying problem with voters appears to be his inability to make the imaginative leap to grasp how other people live. In late April, Romney urged Ohio college students to follow their dreams: “Take a shot, go for it, take a risk. Get the education. Borrow money, if you have to, from your parents. Start a business.” These are laudable sentiments, except for one tin-ear detail: Most American families do not have a bankroll of, say, $50,000 or $100,000 sitting on the sidelines waiting to be loaned to the first child ready to launch a new business.

Bain is as substantive a part of Romney’s resume as Hollywood was for Ronald Reagan. Maybe more so, because in Romney’s case so much else is off-limits and airbrushed from his political history. Never mentioned by Republicans, for example, is Romney’s failed 1994 Senate campaign against Ted Kennedy in which he backed gun control, proposed tying the minimum wage to inflation and appeared at a fundraiser for Planned Parenthood. That was another Mitt Romney in another century.

Despite Romney’s truth-stretching boast that he was a “severely conservative” governor of Massachusetts, his record in office suggests otherwise, inspiring a touch of forgetfulness. Never deliberately mentioned on the campaign trail is Romney’s nonpartisan approach to appointing judges in Massachusetts. Or his long-standing support for abortion rights until he wrote in a 2005 op-ed (using an eerily Obama-esque choice of words) that his “convictions have evolved and deepened on the issue.” And then there is that amnesiac detail about Massachusetts’ first-in-the-nation law imposing a health care mandate on state residents.

So what’s left? Romney does deserve credit for the success of the 2002 Salt Lake City Winter Olympics. Of course, the Olympics had a budget of about $1.3 billion for the three years that Romney oversaw it. That three-year total is less than the federal government currently spends every three hours.

About the only thing else on Romney’s adult record is the six years that he has spent in the single-minded pursuit of the highest office. But to say that a major Romney qualification for the presidency is the years that he has spent running for the presidency is akin to Kim Kardashian (like Zsa Zsa Gabor before her) being famous for being famous.

This process of elimination inevitably leads back to Bain Capital. What matters is not Bain’s job creation record but the values that Romney absorbed on the job. Romney’s belief in the creative destruction of capitalism, his conviction that a dynamic economy produces winners and, yes, losers would undoubtedly shape his presidency. That is his economic vision—and it is directly linked to his years at Bain.

The problem, of course, is that this is not the kind of argument apt to pop up in TV commercials in the heat of a presidential quest. Instead, the exaggerated Democratic attacks on Romney’s record in private equity are designed to make him seem like the 19th-century landlord who throws widows and orphans into the cold on Christmas Day. Small wonder that Obama said at Monday’s press conference that Romney’s Bain record is “not a distraction” before adding, with a hint of malice, “this is what this campaign is going to be about.”

So it is easy to conclude that, from now until November, the Bain refrain will play mainly in the Plains – and everywhere else there are swing voters.