The original may be found on yesterday’s Wall Street Journal editorial page.
The back-to-school season is here, and as parents take their children to shop for school supplies, I suspect that many of them will be visiting a Staples store. I’m very familiar with those stores because Staples is one of many businesses we helped create and expand at Bain Capital, a firm that my colleagues and I built. The firm succeeded by growing and fixing companies.
The lessons I learned over my 15 years at Bain Capital were valuable in helping me turn around the 2002 Winter Olympics in Salt Lake City. They also helped me as governor of Massachusetts to turn a budget deficit into a surplus and reduce our unemployment rate to 4.7%. The lessons from that time would help me as president to fix our economy, create jobs and get things done in Washington.
A broad message emerges from my Bain Capital days: A good idea is not enough for a business to succeed. It requires a talented team, a good business plan and capital to execute it. That was true of companies we helped start, like Staples and the Bright Horizons child-care provider, and several of the struggling companies we helped turn around, like the Brookstone retailer and the contact-lens maker Wesley Jessen.
My presidency would make it easier for entrepreneurs and small businesses to get the investment dollars they need to grow, by reducing and simplifying taxes; replacing Obamacare with real health-care reform that contains costs and improves care; and by stemming the flood of new regulations that are tying small businesses in knots.
My business experience confirmed my belief in empowering people. For example, at Bain Capital we bought Accuride, a company that made truck rims and wheels, because we saw untapped potential there. We instituted performance bonuses for the management team, which had a dramatic impact. The managers made the plants more productive, and the company started growing, adding 300 jobs while Bain was involved. My faith in people, not government, is at the foundation of my plan to strengthen America’s middle class.
I also saw firsthand through these investments how energy costs impact the ability of a business to grow. Today, energy costs are weighing on job creators across America because President Obama has limited energy exploration and restricted development in ways that sap economic performance, curtail growth, and kill jobs. I will take a sensible approach to tapping our energy resources, which will both create jobs and make energy more affordable for every sector of our economy.
In the 1990s, when the “old-technology” steel industry in the U.S. was failing, Bain Capital helped build a new steel company, Steel Dynamics, which has grown into one of the largest steel producers in America today, holding its own against Chinese producers. The key to its success? State-of-the-art new technology.
Here are two lessons from the Steel Dynamics story: First, innovation is essential to the competitiveness of U.S. manufacturing. We are the most innovative, entrepreneurial nation in the world. To maintain that lead, we must give people the skills to succeed. My plan for a stronger middle class includes policies to give every family access to great schools and quality teachers, to improve access to higher education, and to attract and retain the best talent from around the world.
The second lesson is that we must have a level playing field in international trade. As president, I will challenge unfair trade practices that are harming American workers.
Running a business also brings lessons in tackling challenges. I was on the board of a medical diagnostic-laboratory company, Damon, when a competitor announced that it had settled with the government over a charge of fraudulent Medicare billing. I and fellow Damon outside board members joined together and immediately hired an independent law firm to examine Damon’s own practices.
The investigation revealed a need to make some changes, which we did. The company, along with several other clinical-laboratory companies, ended up being fined for billing practices. And a Damon manager who was responsible for the fraud went to jail. The experience taught me that when you see a problem, run toward it or it will only get worse.
That will be my approach to our federal budget problem. I am committed to capping federal spending below 20% of GDP and reducing nondefense discretionary spending by 5%. This will surely result in much wailing and gnashing of teeth in Washington. But a failure of leadership has created our debt crisis, and ducking responsibility will only cripple the economy and smother opportunity for our children and grandchildren.
I’m not sure Bain Capital could have grown or turned around some of the companies we invested in had we faced today’s anti-business environment. Andy Puzder, the chief executive of CKE Restaurants Inc., which employs about 21,000 people at Carl’s Jr. and Hardee’s restaurants, has said that the “current unfriendly economic environment perhaps best explains why American companies are sitting on over $2 trillion which they could invest.”
President Obama has piled on excessive regulations, proposed massive tax increases, added more than $5 trillion in federal debt, and failed to address the coming fiscal cliff—all of which is miring our nation in sluggish growth and high unemployment.
I know what it takes to turn around difficult situations. And I will put that experience to work, to get our economy back on track, create jobs, strengthen the middle class and lay the groundwork for America’s increased competitiveness in the world.
A few comments from Paul Johnson, if you’ll indulge, about why what Mitt says is so important:
1. Mitt’s succeeded before. We have some serious problems, but Mitt has displayed an unusual ability to solve difficult issues. From his tenure at Bain, to establishing and turning around other companies, to turning around the Olympics, Mitt Romney knows success and how to replicate it. We don’t have four more years to fix our economic and budget issues. As a foil to the last four years’ failures, we have a candidate in Mitt Romney that Jack Welch, legendary head of GE, called the most qualified candidate for president in his lifetime. We have no excuse not to fire our current president and hire someone who can tackle our problems. Remember this interview?
2. A good idea isn’t good enough. Just like having the government provide infrastructure isn’t good enough. It takes an entrepreneur to “build it.” Mitt will never forget that.
3. Through his experience Mitt knows what it takes for businesses to succeed. Mitt will be the true friend of the middle class, not by promising handouts, but by creating jobs and a chance to achieve something. Part of creating jobs is easing the regulatory burden on business by repealing, among other things, Obamacare, its trillions in unfunded obligations, hidden taxes and freedom-limiting mandates, while replacing it with a real solution that cuts costs. Creating a business-friendly environment would free up the trillions Mitt describes in his article. Simply allowing US companies to re-patriate foreign earnings without taxing them could also result in the infusion of a trillion dollars into our economy without costing the US taxpayers a dime. Both are priorities for Mitt.
4. Mitt makes clear his faith is in the ingenuity of the American people to pull us out of this economic mess, not the government.
5. He focuses on the importance of energy independence to create jobs and liberate the US from its addiction to foreign oil. See Jayde’s article immediately preceding this.
6. He points out how critical innovation is to our economy. We are now competing in a worldwide marketplace for jobs, and labor is just plain cheaper overseas. But Mitt knows we don’t want to be the world’s low cost labor supplier. The key to American success is to offer something no one else can: innovation, invention and improvement. And when we invent something spectacular, we have to protect it by making sure other nations can’t steal it. Failure to do so hurts American jobs. Taxing those that are successful hurts American jobs.
7. When Mitt sees a problem, he runs toward it, not away from it. Our government has been running from the big problems of the budget deficit and the looming “fiscal cliff” for so long they now seriously threaten our economy. Through his pick of Paul Ryan as his running mate, Mitt has shown commitment to honest debate and real change. Mitt’s taking the problems with the budget deficit, the economy and Medicare head-on.
8. Finally, Mitt points out Obama’s failure. He’s had nearly four years, but his promises of below 8% unemployment, halving the deficit and creating a “post partisan” political world remain unfulfilled. Instead, his campaign has been full of partisan rancor in an effort to avoid a discussion of Mitt’s accomplishments and Obama’s failures. I’m sure Obama is frustrated he didn’t accomplish what he wanted in his first term. But it’s the mark of a leader to get things done, not to complain about the size of the problem. Obama has failed. It’s critical we now go with the man who’s the most qualified candidate in our lifetime. Mitt Romney.