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Inflated numbers in Romney's resume


It was one of the best smack-downs of his otherwise clunky campaign. Mitt Romney took Newt Gingrich’s beloved fantasy about building a lunar colony and dumped it in the large pile of loony Newtisms.

“I spent 25 years in business,” Romney told a bemused Gingrich at the GOP debate in Jacksonville, Florida, in January. “If I had a business executive come to me and say they wanted to spend a few hundred billion dollars to put a colony on the moon, I’d say, ‘You’re fired.’”

Channeling his inner Donald Trump, this was the moment when the numbers-driven chief executive Romney displaced the pandering, fuzzy math candidate Romney.

So what would CEO Romney think of the candidate now campaigning in his name? What if the candidate walked up to the brains behind Bain and asked for some of their precious capital?

First, the private equity execs would not stand for the inflated numbers padding out Romney’s resume.

The former Massachusetts governor claims to have helped create 100,000 jobs at Bain, but that includes many years after he left the firm. Back when he was running to the left of Ted Kennedy for the Massachusetts Senate seat, Romney claimed in interviews and TV ads that he helped created just 10,000 jobs.

It’s strange that Romney likes to count jobs added after he left Bain because he does not take the same approach to job losses after he left the firm.

Talking to the right-wing talker and blogger Ed Morrissey this week, Romney said it was unfair to suggest that he was responsible for a steel factory that closed after his departure. “The problem, of course, is that the steel factory closed down two years after I left Bain Capital,” he said. “I was no longer there. So that’s hardly something that was done on my watch.”

Burnishing your legislative record might be standard in congressional races. Bike paths magically become “economic development.” Symbolic votes turn into historic battles for constituent groups.

But a tenfold exaggeration in your numbers would get you laughed out of the C-suite. Or possibly fired by someone like Mitt Romney.

Then there’s the small problem of the budget that doesn’t add up. At the core of any business plan is a spreadsheet proving how you’ll turn your brilliant idea of a lunar colony into a vastly profitable monopoly mining precious metals.

Romney’s big idea is that he can turn round the economy by cutting the deficit and government spending. So what does his spreadsheet show?

By his own admission, the spreadsheet has so few numbers in it, you can’t actually tell if it adds up. “I think it’s kind of interesting for the groups to try and score [the tax plan] because frankly it can’t be scored,” he told CNBC in March, “because those kinds of details will have to be worked out with Congress and we have a wide array of options.”

Hiding your numbers is not the best way to get investors or voters to trust you – or to prove your executive skills. Unless you’re a risk-management executive at JP Morgan Chase, the number-hiding strategy is generally unacceptable.

What we have seen of the numbers add up to this: a complete contradiction of Romney’s strategy.

It isn’t physically possible to cut the deficit while also cutting taxes and raising defense spending. And we’re not talking about small tax cuts or small hikes in the military budget, which already represent around one-fifth of federal spending. The United States already spends more on defense than the combined budgets of the next 20 military powers.

Romney would increase spending by another $2 trillion on defense over the next decade. His plan to cut taxes 20 per cent across the board, even beyond the Bush tax cuts, would add at least another $4 trillion to the deficit over ten years.

At this point, the private equity masters of the universe might just look at Romney’s record running other similar entities. Take the government of Massachusetts, for instance: a four-year period otherwise airbrushed out of the Romney campaign at this stage.

While managing the business known as the Commonwealth, Romney increased debt by $2.6 billion, with a jobs record that placed the state near the bottom of the nation.

Romney’s campaign says he’s a turnaround specialist. He could start by turning around his own nonsensical promises from the primaries. Drop the idea of cutting taxes beyond the Bush tax cuts and the notion of increasing the Pentagon budget. Don’t just attack the White House budget, write your own and reveal the numbers.

If you’re a turnaround CEO, campaign like one. Otherwise the voters might treat you like the board of Bain Capital.