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Romney Spurns Business Allies for Tea Party on Debt Deal Romney Spurns Business Allies for Tea Party on Debt Deal

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Politics / CAMPAIGN 2012

Romney Spurns Business Allies for Tea Party on Debt Deal

Mitt Romney disagreed with his business allies on the debt ceiling deal.(Robert Giroux/Getty Images)

photo of Beth Reinhard
August 2, 2011

By opposing the budget deal aimed at staving off government default, Mitt Romney put himself at odds with the constituency he claims to represent better than any other Republican presidential candidate: the business community.

Associations including the U.S. Chamber of Commerce, the National Federation of Independent Business, and the Business Roundtable urged Congress to pass the $2.1 trillion, deficit-cutting proposal, which holds the line on taxes and averts a widely predicted financial catastrophe. “The failure to pass this legislation will have long-term negative and damaging effects on the American economy. America must act now,’’ demanded the Financial Services Roundtable, which represents 100 of the nation’s largest financial-services companies.

Romney’s decision to side with the insurgent tea party movement over the business community reflects his status as a fragile front-runner still struggling to win over the party’s most ideologically conservative wing.

 

“To say you oppose a bill on Monday when we’re not going to have the cash to pay our bills on Wednesday is not a responsible thing to do,’’ said Richard Sansing, a professor at the Tuck School of Business at Dartmouth University, said. “I am surprised by Romney, considering his background. He knows better."

Securities and investment firms are the top contributors to Romney’s campaign, according to the Center for Responsive Politics. Wall Street has been braced for calamity if the government failed to reach a deal. But by waiting to take a position after the agreement appeared on track to enactment, Romney reduced his chances of facing repercussions from his business-minded donors. He has no public appearances scheduled this week, depriving reporters of the chance to question him about his stance.

The former CEO of a major private-investment firm and a Harvard Business School graduate, Romney has tried to position himself as the candidate best equipped to revive the flagging economy while criticizing President Obama as in over his head.  “Mitt is not a career politician. He has spent most of his life in the private sector, giving him intimate knowledge of how our economy works,’’ his website says.

His statement on the debt deal drew criticism from both his GOP rivals and Obama's supporters. Romney had declined to take a position on proposals to keep the government’s checkbook open until Monday, the day before the deadline set by the U.S. Treasury Department for increasing the debt limit.

“To dodge the debate or wait until the debate is over and take a side, I don't consider that to be leadership," said former Utah Gov. Jon Huntsman, who was campaigning Monday in New Hampshire, where Romney leads in the polls. Huntsman was the only major Republican candidate who backed the deal to raise the debt ceiling.

Bill Burton, a spokesman for the pro-Obama Priorities USA Action, said of Romney: “At best, his capitulation is a phony concession to extremist members of the Republican Party. At worst, it is proof positive that Mitt Romney will say or do anything to win this nomination despite the consequences for the country he is running to lead.’’

Burton’s remark aims to revive the flip-flopping line of attack that doomed Romney’s campaign in 2008. Thus far, the former Massachusetts governor has sought to project a less calculated and more statesmanlike persona in his 2012 campaign. Despite pressure to do otherwise from his party's right wing, he has acknowledged climate change and refused to sign pledges from groups opposed to abortion and gay marriage that he thought went too far.

But in the debt deal, Romney ultimately lined up behind his surging grassroots challenger, Rep. Michele Bachmann of Minnesota, who has consistently oppose raising the debt limit under any circumstances. He sought to put the blame on Obama’s shoulders.

"President Obama’s leadership failure has pushed the economy to the brink at the 11th hour and 59th minute,'' said Romney, just hours before Congress was scheduled to vote. “While I appreciate the extraordinarily difficult situation President Obama’s lack of leadership has placed Republican members of Congress in, I personally cannot support this deal.''

His statement also included an overture to the party’s military hawks, criticizing the deal for “putting defense cuts on the table.’’

Reed Galen, a Republican strategist who is not working for any of the presidential candidates, said that Romney was smart to try to stay above the fray during the increasingly chaotic debt negotiations over the past few weeks.

“This is an esoteric, legislative fight, and to be lumped in with these guys in Washington is to be lumped in with an unpopular crowd and not to his advantage,’’ said Galen, who worked on the 2008 presidential campaign of Sen. John McCain, R-Ariz. “You don’t want to look like you are complicit.’’

Romney supporters said it was unfair to expect him to weigh in on the debt talks as one proposal replaced another on the table. He wasn’t obligated to weigh in, they said, until the compromise was reached.

“I think he was respecting the process and watching and waiting to see what would come out of it,’’ said John Rood, a real estate developer serving cochairman of Romney’s finance team in Florida. “In the end, it was right for him to speak up.’’

 

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