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the national interest

Romney: The Economy Equals Business

MIDDLETON, WI - APRIL 01:  Republican Presidential candidate, former Massachusetts Gov. Mitt Romney speaks during a town hall style meeting on April 1, 2012 in Middleton, Wisconsin. With less than a week before the Wisconsin primary, Mitt Romney continues to campaign through the state.  (Photo by Justin Sullivan/Getty Images) There's only one thing that matters to the economy.

Mitt Romney has unveiled a new version of his stump speech, mixing odes to free enterprise with feverish hallucinations about President Obama’s imagined hatred and vilification of rich people. This passage leapt out at me, as it embodies both the substantive problem with Romney’s vision and a major potential liability:

Out-of-touch liberals like Barack Obama say they want a strong economy, but they really don’t like businesses very much.  But the economy is simply the product of all the nations’ businesses added together.  So it’s like saying you love omelettes but don’t like eggs.

The key notion here is that the economy is just a sum of businesses in the same way an omelet is simply a bunch of eggs. Romney took a lot of flack for announcing last summer that “corporations are people,” but he was right about that — he was rebutting a puerile left-wing view of corporations as disembodied things that could be taxed without, somehow, coming out of somebody’s pocket. The view Romney assailed also, implicitly, presented corporations as malevolent actors whose welfare is unrelated, or even in opposition, to that of the country as a whole.

Romney's line about businesses as the whole of the economy is in some respects the mirror image of that puerile leftism: Businesses are not just part of the economy, they are the economy. That premise would explain Romney’s program.

But there is more to the economy than business. It also consists of such things as the public sector and workers. The distinction is important because during the last business cycle, which coincided with the George W. Bush presidency, corporate profits rose sharply while the median income failed to rise at all. It would be unfair to blame this entirely or even mostly on Republican policies, though Republican policies surely played a role. The larger point illustrated here is that to define the fate of the economy solely as the product of business is wrong. Not just morally wrong but factually wrong.

Business success is a necessary condition for a successful economy, but it’s not a sufficient condition. Romney is contrasting his pro-business standpoint against Obama’s imagined hatred for business. The actual contrast is Romney’s belief that the economy is entirely defined by the success of business, against Obama’s attempts to balance the needs of business with providing for the health, educational opportunity, and general well-being of the workforce. This also seems like a contrast that would be easy for Obama to exploit: Most Americans, I’d guess, see themselves as part of the economy. A conceptualization of the economy that excludes them is not one they would like to embrace.

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Photo: Justin Sullivan/Getty Images