Friday, September 21, 2012

Romney Campaign develops money trouble

That may be the headline you least expected from the Moneybags campaign, but it appears to be true.

Part of it may be a whingeing effort to appear the underdog or victim.  In August, before the convention, Romney had to borrow money from his general election campaign fund for his primary campaign fund.

Note several things. The first is that the explanation is nonsensical.  There was no "tilted playing field." Obama had the same rules, and in fact because his convention was later, had to use primary funds longer than Romney.  It's true that Obama had no effective primary opposition, but it was also correspondingly much harder for him to raise primary funds than it was for Romney.  Romney has blanketed the airwaves with negative ads, and he certainly didn't wait for Obama's initiative in that regard.

The corporate leaders of the Romney campaign don't expect anything they say to be scrutinized or challenged. I am reminded of when I started work for General Motors back in the 1980s.  We all had to take a class called "The Business of General Motors."  It started with a history of the company, in which they made a startling claim: that imports first got a foothold in the American auto market when General Motors had to retool to fight World War II.

I said I guess those German, Japanese, and Italian car companies had nothing better to do while GM was fighting the good fight.  The teachers were bewildered that anyone would bother pointing out the absurdity, and why it mattered.  Romney's people have the same blankness about them.  It matters because lying always matters, because the legality of the funding move is open to question, and because they mismanaged their money, the candidate's sole claim to special competence; and because they are the party of the rich, who should never have money problems by definition. 

Here's the next issue: $11 million of the loan has still not been paid back.  Remember, in American politics the politicians demand money, and the rich fork it over.  Romney was unable to make that happen in the weeks since the convention, which means the rich are deciding how much Romney can spend instead of vice versa.  Rove would have been all over the captains of industry, threatening them into submission.  Today, the rich expect Romney to do the submitting, a curious reversal considering he is one of their own.

Third, having been given the freedom to be dilatory, the rich are slow to fulfill their pledges.  Anybody who has done business with the Fortune 500 knows this.  They will start to think about paying your invoice after 90 days, and send the money to a lockbox in Bora Bora for the check to be cut in the hopes that another three months will go by before the cash leaves the account.  They are trained to do this in business school, and the entire lockbox industry is organized around the idea of fast cash in, slow cash out, and skim interest off the float.  Probably a million jobs have been lost to small business over the years, waiting on checks from big business who can't be threatened with credit downgrades.  When Romney hitched his campaign to big business, he had to expect delays.  After all, at the Salt Lake Olympics, the reason for the "shortfall" Romney said he found when he arrived was due to companies being dilatory in paying their pledges.  Why then has corporate sluggishness surprised his campaign?  Maybe because he didn't "fix" Salt Lake's finances after all, but the companies paid up because they realized the Olympics would soon be over.  They have no need to rush contributions to someone like Romney who can cover his campaign from his own pocket plus Bain Capital if he needs to and doesn't need to be bribed to take their side. In 2008, Romney pumped over $40 million of his own money into his campaign. This year he has used other people's money, and the lack of personal contribution is starting to look like lack of confidence.  It may not be: as noted previously on this blog, Bain Capital has put enormous resources into buying media companies.  But it's enough to make business nervous.

That did not stop Romney from paying out big bonuses to campaign staff, in a way redolent of Hillary Clinton's showering money on undeserving staff in 2008.

It didn't help her avoid infighting, and it won't help him either.  Remember, Romney won fewer votes in the Republican primaries than John McCain did in 2008, despite a vastly larger spending program.  So his largesse with an undeserving staff smells of aristocracy.

But there are other stories too, of Romney pulling back ad spending in swing states.,0,3631939.story

Granted, their ads have not worked so far, despite being stuffed with lies, so some retooling is in order.  After a certain level of ad buys by Romney and his PACS, any further spending simply goes to increase the price of time (still worth it to Romney when his pals own the stations and Obama has to pay the same prices).  Perhaps the truth is television advertising has become so saturated it no longer has much  value to the campaigns.

Nonetheless, this blog has speculated before that Romney may be exaggerating his campaign fundraising, and this may be an indicator that this was true.  Maybe even the rich don't really see a future for Romney as president.

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