Zakaria: Romney’s real problem
Republican U.S. presidential hopeful and former Massachusetts Gov. Mitt Romney. (Getty Images)
January 11th, 2012
06:52 PM ET

Zakaria: Romney’s real problem

Editor’s Note: You can now buy episodes of CNN GPS online through iTunes.

By Fareed Zakaria, CNN

Despite the tea party’s extraordinary energy over the past year, it looks like former Massachusetts Gov. Mitt Romney will win his party’s nomination.  At the end of the day, Republicans are following a familiar pattern: Nominating the mainstream candidate who has waited his turn. This is the party that’s had a Bush or a Dole on its ticket for 20 years. It’s a party that also had Richard Nixon on its presidential ticket for 20 years.

In 2011-2012, we’ve learned that the tea party’s passion was not enough to change the Republican Party. However, something else is changing the party, and you can see it in the attack ads Romney’s opponents are running against him.

Watch: Why we can’t cut our way back to more jobs.

His opponents have gone against Romney on two levels. First, they have called him a “Massachusetts moderate.” After deploying this epithet, Romney’s opponents point to specific positions of his that deviate from party orthodoxy: Romney’s health care plan is strikingly similar to Obama’s; Romney’s positions on abortion and gays used to be a lot more liberal than they are now; etc.

Even though this seems like a fairly coherent line of attack (Romney has described himself as moderate, after all), it’s not having much traction. Perhaps this is because voters think Romney would be more viable in a general election. Perhaps they feel he has genuinely changed his mind. Or perhaps they don’t care that he’s flip-flopped (I’ve often thought that hardcore activists almost like the fact that you are pandering to them; it gives them a sense of power).

Watch: What’s behind America’s jobless recovery?

Instead, a second line of attack has been gaining traction against Romney – that of Romney as job-killer or Romney as the private equity guy, who buys companies, hollows them out and outsources jobs.

Now it is striking that this attack is coming in a Republican presidential primary. After all, what Romney did while at Bain Capital was classic capitalist “creative destruction.” He took over businesses and tried to make them more productive and efficient. To do so, he often had to shed jobs.

Watch: GPS Special – Getting Back to Work.

Republicans should be celebrating Romney’s prior work as an example of how the market functions – driving out inefficiency, generating productivity and creating a lean, mean capitalist machine.

The fact that Romney’s past has turned into a line of attack tells you that something has changed in America. Even in the Republican Party, there is a huge concern about what globalization and technological change are doing to the average, middle-class American. There is a sense that the system is not working for the median American worker. 

Read: Fareed Zakaria on how to create jobs in America

If you look at job creation over the last 20-25 years in America, you’ll notice that we haven't been able to create any jobs in what is called the “tradable sector” of the economy - those jobs that are subject to global competition. The only jobs we’ve really created have been in industries like health care, government, and construction, which are basically local industries shielded from global competition. You can't outsource the building of a New York skyscraper to a Chinese worker.

America hasn’t been able to create jobs in any sector that’s subject to global and technological pressures. As a result, there is a huge sense of disillusionment, disappointment and pessimism among Americans.

Watch: Why Obama should declare a jobs emergency.

None of the Republicans are addressing this problem centrally. They’re simply talking about cutting government spending as if that is going to solve the problem of creating new industries, opportunities and jobs. Simply cutting government strikes me as a very inadequate response to a massive challenge.

Hopefully during the general election, we’ll have a substantive national debate about how to create jobs in America.

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soundoff (641 Responses)
  1. Mirza Baig

    Mr Zakaria,
    Can I just say that it is a relief that the debate about Romney is about private equity and leveraged derivatives and not about mormonism or abortion rights. Who would have thought core capitalistic fundamentals would be on trial...in America.
    Mitt Romney is intelligent and hard working. The fact that he has a JD MBA from Harvard, the fact that he founded what today is one of the top 3 managment consulting firms in the world, the fact that he became CEO of Bain Capital and then had aspirations to run for public office should all be testimony to his character.
    The thing that people forget is that Romney is a politician, ad just like every politician, he changed his stances in order to get elected. Obama did the same thing, McCain did the same thing heck even good ol' W did the same thing.
    At the end of the day, it should come down to whos going to "not mess things up further" in 4 years. No one is going to "fundamentally transform" or "change" America. Its a 4 year presidency, things will change, most will stay the same.
    The important thing is to go out and vote! If you dont like someone, make your ballot heard ad not just sound off on an internet message board.

    January 12, 2012 at 12:45 am | Reply
  2. casper

    The only guy who can beat Obama is Mitt Romney.......are you reading their credentials, achievements and family background...He is the real American guy to beat Obama.......watch out Obama has collected lots of money (billions)...he will fight it out...that he is already campaigning instead of governing, Plus ........ he controlled the media network.....better yet to make matters worse use your coconut shell like chi-chi-echia....and let the grass grow on your heads too.

    January 12, 2012 at 1:21 am | Reply
    • Peter

      Caspar:

      Explain how Obama is so sinister by campaigning at this point in his first term just like every other first term President did at this point in the election cycle.

      Explain how Obama "controls the media". The #1 cable news network is Fox. The top 5 radio talk shows are all conservative. Every big city has at least a half-dozen "Christian formatted" radio stations. What on earth are you talking about?

      January 12, 2012 at 1:50 pm | Reply
  3. Mike

    How funny we keep pinning our hope on a savior to rescue us every 4 years! Time to wake up and realize that presidents and parties don't make or break our destiny. Only way to progress is through innovation, supporting and funding our research facilities and Universities. Only through producing bright minds and staying on the cutting edge of technology we can beat other nations and provide a viable middle class. All we are doing is tearing each other down by accusing and labeling each other. History shows that great civilizations don't fall because of a bad leader, they gradually decline by forgetting what got them there in the first place.

    January 12, 2012 at 1:27 am | Reply
    • Mirza Baig

      Mike, Completely agree with you. All this talk of a "revolution" and a "change" are just talking points for political campaigns. All the successful people in the coutnry are pioneers in thier fields of innovation and development. People need to stop hoping for a rescue every 4 years and just accept that true change comes from within.

      January 12, 2012 at 10:57 am | Reply
  4. Bocknobby

    Those who criticize Romney for cutting jobs while he was at Bain Capital yet call for cuts in government spending are either hypocrites or not truthful. A government dollar spent goes into someone's pocket. If you subscribe to the multiplier effect - more credible than trickle-down economics - that government dollar impacts six or seven individuals in the chain. Cutting government spending means cutting jobs. The argument that cutting government spending means leaving more money in the hands of individuals who, in turn spend the money, is bogus; while most Americans do not have a high propensity to save, some do. The government does not; most western governments not only spend every dollar of tax revenue but are happy to borrow, some excessively, to finance spending programs. It would be refreshing to see some Republican candidate admit that cutting government spending means cutting jobs. If it is valid for Romney and Bain Capital, it is valid for the federal government. Hypocritical or just not truthful? In either case the individual is not the sort of person one would like to see sitting in the Oval Office.

    January 12, 2012 at 1:30 am | Reply
  5. johnny

    No amount of taxation or cutting Government jobs is going to resolve a US15 trillion Government debt – stat !

    Solving America's financial woes is all about exports, exports, and more exports. This is the moment, and America must seize it – to sell sell and sell overseas. Amercan goods and services are admired world wide.

    Look at your car plants for one example, these big companies were losing billions for the last 5 years and more for some, yet only recently did they suddently find themselves making more money than ever. How? Their CEOs finally came to their senses and expanded operations overseas particulatly in China and the emerging countries.

    So, Bingo! This is America's solution to clear its monstrous debts and return to economics sanity. For too long American factories have relied on debt ridden local consumers who are living beyond their means. That over reliance has now become a mirage and a big national headache.

    Forget the job cuts and the American consumers. Go sell to the world.

    And ..... insist on closing down 90% of all US foreign military bases. Congressmen would fight that because they have their self interest groups to look after, their financiars – the military hardware supplires, defence contractors, etc.

    By doing the above, I guarantee America would become debt free – and back in No.1 by 2030 – possibly knocking down China to number 2.

    Bear in mind that China have not completely liberalised local enterprise. And that 10 + million brilliant business minded Chinese technocrats should be ready and waiting to enter the business world with their new inventions and innovations. And their opportunities will come as China,Banks become increasingly flushed with foreign cash.

    January 12, 2012 at 2:30 am | Reply
  6. adegboyegaaremu

    Non of these presidential hopefuls can beat Obama.Their manifesto is pro the wealthy and what the average Americans want is a more assured social security and they are already seeing some kind of light in the Obama's administration policies,so i do not want to believe they would leave known for an unknown.

    January 12, 2012 at 3:56 am | Reply
    • MacRen

      I am an American and the last thing I want is a hand out. I can stand on my own feet. Democrats can keep their welfare checks.

      January 15, 2012 at 12:43 am | Reply
  7. Benedict

    Mitt Rommeny looks like the man to challenge Obama in the next presidential elections and yet,his own party members are out to destroy him before the polls start! Now, i wonder is that the type of poltical party that wnats to control the White House if they should beat Obama? I think that the majority of americans will rather stick with the devil they know rather than the angel that they don't! After all,Bush's ratings as a leader were low and they still elected him into office for a sceond term!

    January 12, 2012 at 4:31 am | Reply
  8. Toppolina

    The GOP had poor choice this time, with probably and may be one exception: Huntsman. Romney gives me the impression he is not honest and is fake. Ron Paul is truly great but too old. Gingrich is OK but lacks tact and pretends to be historian when he knows nothing about history. Who else was there???? Already forgotten.

    January 12, 2012 at 9:39 am | Reply
  9. Anti_Fareed

    Fareed, when will you write about something you are knowledgeable in? For example, India's caste system.

    January 12, 2012 at 9:49 am | Reply
    • donotknowhim

      Fareed zakaria is a muslim, who stood for 9/11 mosque.Sorry I disclosed it. So what will you expect him to write about India.

      January 12, 2012 at 10:07 am | Reply
  10. Hahahahahahahahahaha

    His real problem is that he's a republican!!!!!!!! Hahahahahahahahahaha

    January 12, 2012 at 10:03 am | Reply
  11. Elaine Connelly

    Obama is nothing but a Chicago Thug. He is not my president and he never will be. He is a snake oil salesman.

    January 12, 2012 at 10:15 am | Reply
    • Sick of BS

      Elaine, Chicago thug? You watch way too much Fox "news". Do yourself a favor and turn off the TV. Read a book – preferably one with facts and not propoganda. Thank you.

      January 12, 2012 at 10:27 am | Reply
  12. Amit-Atlanta-USA

    For the GOP who have of late become a part of NO and taken over by the extreme rightwing Tea-Partyers Romney and even more so Huntsman are the only real bets if they have a chance to unseat Obama. Rest of the gang are a bunch of ideological losers. While Gingrich with all his intelligence can never shrug off his Washington insider image and also his huge personal baggage, Rick Santorum with his extreme views on abortion, gay marriage, contraception, etc.is completely off main stream, Rick Perry after all the debate debacles shows he is ill equipped (at least for now) and ofcourse Ron Paul with his extreme view imicable to US security particularly those on radical Islam (Iran, the war on terror plus his opposition to the Fed etc.). None of these guys can ever win the crucial independent votes necessary to win the presidency.

    January 12, 2012 at 10:30 am | Reply
  13. Neil P

    This story appears in the Google News feed as "Romney's real problem is that he is a Mormon". You might want to get that fixed!

    January 12, 2012 at 10:31 am | Reply
  14. Richard J

    Not quite true that Romney isnt saying how he will create jobs. Declaring China a currency manipulator is his only courageous stance, but it is a winner for jobs. With this, a 40% surcharge is applied to all Chinese goods, based on the yuan's undervalue. Then a $10 alarm clock costs $14, a $50 pair of shoes costs $70, and US manufacturers can suddenly compete with a level playing field. And for as long as China continues to sell $300b+ to the US, the penalties amount to $120b per year into the coffers of the US Treasury. The benefit to jobs will be in the millions, people off of welfare and unemployment, more income taxes, more to balance the budget. It's all good. And Romney is right: China is the last country to afford a trade war. This is about the only thing i agree with Romney on, but it is a really big thing, in my view, for restoring the health of the US economy.

    January 12, 2012 at 10:40 am | Reply
    • Captain Correct

      politicians don't create jobs. Do you really think that Barack Obama who never actually had a private sector job knows the first thing about creating jobs????

      January 12, 2012 at 10:59 am | Reply
      • Emperor Norton

        Since jobs have been created at a slow but steady clip for the last nineteen months, as per the Treasury Department, it would appear he knows more about job creation than you give him credit for.

        January 12, 2012 at 7:09 pm |
  15. robert feingold

    I think Mitt Romney's problem is narcissim.

    No one believes that he cares about anyone other than himself, his family and perhaps members of his church.

    Since being elected, Obama has been distant too. They might cancel each other.

    January 12, 2012 at 10:42 am | Reply
  16. Captain Correct

    other then illegal aliens, his cronies (Solyndra), and undermining the interests of the US, attacking the US energy industry and virtually any business that works what does Obama care about again?

    January 12, 2012 at 11:00 am | Reply
    • jimm

      Please explain how fixing bridges and roads does create jobs? and please exlain how he is undermining america (Seems that was done before he took office), and how asking the oil companies to stop taking tax payer subsidies or put plans in place to try to prevent oil spills is attacking the energy industry?

      January 12, 2012 at 11:36 am | Reply
  17. palintwit

    Whenever I think of Alaska, I think of Sarah Palin. Whenever I think of Sarah Palin, I think of teabaggers. Whenever I think of teabaggers, I think of nascar. Whenever I think of nascar, I think of trailer trash. Whenever I think of trailer trash, I think of Sarah Palin. Whenever I think of Sarah Palin, I think of teabaggers. Whenever I think of....

    January 12, 2012 at 11:03 am | Reply
    • FLIndependent

      Love it!

      January 12, 2012 at 2:01 pm | Reply
  18. JOE

    So is it really President Obama's responsibility to create jobs or the Republicantebag House? After all, they have set up roadblocks to stall the President's jobs bills, saying they won't work. Then they say they have all the answers to creating jobs and re-growing the American economy. Well, if so then why is the unemployment rate still above 8%? And what is it that the GOPbags are waiting for? Since they have all the answers to job growth why haven't they responded by stepping forwarded with it? From day one President Obama has said to the opposition if you have a better plan for creating jobs and re-growing the American economy, then step forward with the answers. So why hasn't the opposition responded? Is it perhaps because they haven't got a clue since they created the economic crisis in the first place?

    January 12, 2012 at 11:14 am | Reply
    • jimm

      All appropriations must start in the House. That answers your question. The House has been very busy passing abortion bills.

      January 12, 2012 at 11:37 am | Reply
    • FLIndependent

      @Joe – I always wonder the same thing. If the Repubs have all the answers then why aren't things wonderful since they took the House. Also, if Romney has the answers and is such a patriot, with all his money & influence why can't he try to improve the economy now – why do the people have to suffer until the next election. I'm sure he has enough businesses in his pocket that he can now convince to hire to turn the economy but that wouldn't be to his benefit now, would it? Also, this morning on MSNBC I heard one of the pundits say that Romney and/or the Repub candidate is going to have many big businesses contributing to their compaign...isn't it funny how they all have so much money for that but not enough to hire!

      January 12, 2012 at 2:06 pm | Reply
  19. David G

    I agree with Michael Smerconish that this assault by Romney's Republican opponents on his work in venture capital will take the wind out of the sails for future Democratic attacks later.

    January 12, 2012 at 11:18 am | Reply
  20. Mike

    You see, the problem is not what it seems and portrayed in media. We as a nation have more money than any time in history. We just forgot to share it equitably and take care of our own. A few on top take everything and their logic is that if you work hard, you deserve it, else you need to starve to death. I got news for you, there are millions of people who work harder than ever. Look at productivity increase over decades. But hard work does not equate to success anymore becasue system is rigged to serve the people who created the scams not the players. We created a system in which we just sit behind a computer and with a click, buy and sell stocks and day trade without producing a thing. Then we turn around and spend that money and on top of that borrow our way to oblivion on the money we don't have. That's how we run up deficits! Time to go back to basics and produce something tangible which we can export!

    January 12, 2012 at 11:42 am | Reply
  21. JOE

    Very well stated!

    January 12, 2012 at 11:50 am | Reply
  22. bill

    THE REAL LIFE GORDON GEKKO!! GREED IS GOOD!!

    January 12, 2012 at 12:17 pm | Reply
  23. Jean

    As a veteran, I will never get beyond the fact that Romney's FIVE sons each of who has never served in the military. Don't tell me "they serve in other ways." They are rich millionaires who leave the horrors of war to small town, rural and innercity kids. They should be ashamed of themselves – not proud of being millionaires and worthless.

    January 12, 2012 at 12:35 pm | Reply
  24. Dan

    I appreciate Fareed Zakaria for his ability to reduce complex issues into a comprehensible message. I think he has achieved this again with this post.

    I wish the Tea Party folks and the Occupiers could rally around their common beliefs, which I believe to be: "Greed and corruption are destroying our nation." I think the Tea Party's perception of capitalism is clouding their ability to accept the importance of economic fairness in a global and connected society. Capitalism does not have to be a zero sum game to be capitalism. In fact, capitalism will thrive when it's based on tangle value creation (vs. transactional wealth) of goods and services that provide a social benefit.

    If we continue to cheer the mantra that "Greed is Good," and perpetuate the belief that capitalism is a zero sum game, we will miss our chance to sustain our reputation as a great nation. If "Greed is Good," then business is easy – it doesn't matter who you hurt, so long as you gets yours, and the more, the better (value as vapor). If "Greed is Good," we will hire foreigners to do our bidding rather than employee our neighbors and enrich our neighborhoods, and thereby our economy. "Greed IS Good" for a few.

    Judging by Mitt Romney's history, I think he believes that "Greed (vs. capitalism) is Good." I believe he will legislate to protect and perpetuate the wealth of a few. I believe he will always outsource without considering the social consequences of doing so. I believe he will govern in his own best interest and I don't think that bodes well for our nation.

    If outsourcing to the best/cheapest labor is a critical component of capitalism, then I support Fareed's nomination for president. I think he's a better option than those running and I think he will be cheaper too. Why must our president be born in America if our workforce need not be born in America (or even a citizen of this country)?

    We will have to reduce the size of government (and social services) because the only way we can afford government is to generate taxes. Income taxes are increasingly becoming the property of foreign governments. The only way to increase government revenues will be to tax transactional wealth (money absent value), and that can't happen! Romney will make sure we eliminate social services (education, healthcare, etc.) before dipping our ladle into the bulging pot of ill gotten gains.

    I am an independent, and I fear Ron Paul's Libertarian beliefs. I think we are living the result of unfettered what humans can/will do to one another if "Greed is Good" and freedoms are ungoverned. Nevertheless, I think Paul may be our only hope for "turning this ship on a dime," and that begins with reining in the Federal Reserve and the power of money to corrupt our culture from the top down.

    I voted for Obama. I had high hopes for a president that might care about the critical importance of a country's working class (where value-for-value exchange still occurs). I don't see much difference between Obama and Romney. I think they both treasure money over matter and will sing whichever tune required to make and/or broker more for themselves. Romney preaches to the top (rich). Obama preaches to the middle/bottom (poor). The Democrats do the bidding of the moochers (make money while sleeping on a couch) while the Republicans do the bidding of the looters (make money while sleeping on a yacht).

    My next vote will go to the person defending the future of the people making money while they work. If I can't find such a candidate, I will vote for the one that does less damage to the people making money while they work. I will not vote for Mitt Romney.

    January 12, 2012 at 12:38 pm | Reply
    • Selby

      http://finance.fortune.cnn.com/2012/01/12/the-bain-bomb-fizzles/?iid=HP_LN

      January 12, 2012 at 1:10 pm | Reply
      • Dan

        Thanks for the link Selby. I have no problem with negative campaigning, so long as the facts are true and pertinent to the decision I'm being asked to make. My problem with Gingrich's attacks are the timing. If he believed these things, he had a responsibility to make them an issue long ago. I have very little respect for complicit silence. I am seeing more links to Romney's time at Bain beginning to appear. Many will be useful and informative. I suspect many will not.

        Here's a great article I read the other day. "The Dumbest Idea In The World: Maximizing Shareholder Value" http://t.co/VW1catX3

        The author does a much better job of articulating my beliefs about Romney's style of "capitalism." That's why professional writers and journalists are so important!

        January 12, 2012 at 2:26 pm |
  25. harrisonhits2

    "Romney as the private equity guy, who buys companies, hollows them out and outsources jobs."

    That's a laughable criticism coming from the party that is all about outsourcing to what are effectively slave labor factories so their ultra wealthy cronies can be ever richer. The Republicans care not about this country or its people, only about servicing the enormous greed of their candidates and corporate owners.

    Not that the Dems are any better. Both parties are utterly and totally corrupt, owned by the corporations and almost never do anything that is in the best interest of the country and its people.

    January 12, 2012 at 12:40 pm | Reply
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