Friday, February 3, 2012

Mittster Fixit

Now that the Republican establishment believes that it has closed the deal on Romney it is beginning to admit that it does not really think very well of him after all.

He was not their first choice. He is not really a politician. He doesn't have conservative instincts or a conservative philosophy. Still, they are convinced that Romney will govern as a conservative.

He will be so terrified of the wrath of Ann Coulter that he will toe the conservative party line. .

These statement signal confidence. Republicans who fought for Mitt Romney are breathing a sigh of relief. They have a candidate who can beat Barack Obama and they have saved the Republic from the return of Newt Gingrich.

The Romney candidacy is based on the notion that Mitt is Mister Fixit. Or else, Mittster Fixit.

This morning I read somewhere—I forget where—that people in Florida had voted for Romney because he will be able to fix the economy.

This may well be a winning slogan, but it does assume that, come November, a lot of people still believe that the economy is broken.

Today’s positive employment numbers will  feed a narrative that the economy is not broken and that we need to stay the course. I am confident that, unless the bottom falls out of the markets, we will be hearing but good economic news between now and November.

Even if people believe that the economy is broken, why does anyone think that someone who knows how business functions and who knows how to fix businesses would know naturally how to fix the economy? 

During Romney's governorship job growth in Massachusetts was anemic.

That is not the least problem with this slogan.

First, the economy is not a business. Second, the president is not a consultant. Third, knowing how business functions does not necessarily entail knowing how the federal government functions. Fourth, even if Romney knows how the federal government functions that does not mean that he can make it function. 

If were just comparing the business knowledge and experience of a management consultant with that of a community organizer, then it’s no contest.

If we are wondering about whether a President Romney would govern as a Republican, then things are far less clear.

As I mentioned in an earlier post, Romney’s wish to index the minimum wage to inflation is so fundamentally wrong that one has a right to doubt the way he would govern.

When it comes to business, management consultants are not leaders or managers. Peter Drucker once explained that he had become a management consultant because he did not have the skills to lead or to manage a company.

Peter Suderman describes the work of management consultants in a recent article in Reason Magazine. 

At its core, the business is based on problem solving. Management consultants ask the same basic question over and over again, explains Avik Roy, a former health policy analyst at the Romney-founded firm Bain Capital and current senior fellow at the Manhattan Institute: “If you’ve got a problem, how do you then break the problem down into discrete parts that we can then empirically address?” The job requires narrowing down mountains of data into a few key metrics, then feeding the information back to the client in executive-friendly formats such as PowerPoint slide shows, colorful pie charts, PDFs splattered with bullet points, historical line graphs, and so on.

A management consultant analyzes a problem in quantitative terms. He presents a set of possible solutions and leaves it to senior management and company executives to implement them.

A management consultant is a bystander, an outsider, a hired gun who brings a different set of problem-solving skills to a job.

Consultants do not fix companies; they offer plans and allow others to implement them. Private equity investors have a say in the management of the companies they invest in, but they do not manage it.

If private equity investors invest in a company like Staples, they do not manage the company. Mitt Romney did not build Staples the way Mark Zuckerberg built Facebook or Bill Gates built Microsoft.

When faced with the problem of the uninsured in Massachusetts Mitt Romney called in the management consultants. Suderman describes what happened.

He hired a team of health care consultants at McKinsey, a longtime Bain & Company rival, to investigate the state’s uninsured population. The preliminary work on the law was conducted in an ideology-free zone. “They didn’t approach it from the standpoint of ‘free market—yay!’ or ‘equality—yay!’ ” says [Avik] Roy. Instead, it was the usual consultant’s method: “What is the problem? Let’s analytically define the problem.”

Of course, political leadership is not an analytic problem. And, what makes anyone think that Romneycare is purely objective and ideologically neutral.

Romneycare is certainly not the only way to solve the problem of the uninsured.

I suspect that management consultants suffer from a special kind of hubris. They become uncomfortable always being the bystander, the outsider, or the hired gun. They want to flex their executive muscles. They want to be in charge. They look at the fools who run corporations and they convince themselves that they would do a better job.

It’s a little like a real estate developer who believes that he would be perfectly competent to run the federal government. I would happily grant Donald Trump all the success he has had in real estate, but I would hardly call that a qualification for becoming president of the United States.

Of course, Mitt Romney did govern the state of Massachusetts for four years. During that time he proved to be a bad politician and an ineffective governor. His signature achievement, Romneycare, has become more albatross than pride and joy.

I think that the Republican pundits and politicians who are pushing the Romney candidacy know this. I am sensing that they are preparing us for a less than stellar campaign and, if it should come to pass, a less than stellar presidential performance.

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