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The Romney Economy


Mitt Romney and Bill Bain, a founder of Bain & Company.  

Right now, a decade into the 21st century, the character of the management consultant is so ubiquitous a part of the global economy that McKinsey more or less guards the gate of the modern financial world. There is a study currently ­concluding in India, for instance, in which Accenture consultants are parachuted in to village textile factories, while a control group of factories is being kept virtually consultant-free, to see how much the strategists can improve operations. (The early results look good for the consultants.)

But in 1975, when Mitt Romney graduated in the top 5 percent of his Harvard Business School class, consulting was still a novel field. As Walter Kiechel’s entertaining history The Lords of Strategy documents, the three most prestigious consultancies (then, as now, McKinsey, the Boston Consulting Group, and Bain & Company) believed they were bringing a newly sophisticated, quantitative approach to business, using theories and techniques to help American industry modernize. They regarded themselves as intellectuals, and they also paid better than anyone else—this being a decade before Wall Street salaries started to really climb—and so Romney made what was, at the time, an obvious career choice. He became a consultant, first at the Boston Consulting Group and then, three years later, at Bain & Company.

The Bain & Company consultants who traveled the circuit of American business in the late seventies and early eighties experienced a mass of frustrations. The efficient, data-driven theory of business the consultancies had developed did not in any real way cohere with the practice of business that they saw in executive suites in St. Louis, Rochester, Houston. The theory said that companies should focus on their core business, but everywhere corporations were developing misguided plans to become conglomerates. The ­theory said management should measure everyone’s productivity in a firm, down to the lowliest employee, and every last worker should be rewarded or punished depending upon his performance, but the social relationships of business seemed to have decayed into a long, amicable golf-course lunch. There was a loyal, almost paternalistic attitude toward workers, protecting them even when they seemed to be drags on growth. When I interviewed Romney’s early colleagues about the business world that they surveyed during this period, they tended to adopt an attitude of high disdain. “Sloppy,” one told me. “Complacent,” said another. “Lazy,” said a third, “and out of tune with the change that was going on in the world.”

These men are still around—it is an unusually small and tight group, and many of them have continued to work on and off for Romney as he has moved into public life. They are mostly immensely rich, and if they give a collective impression, it is tanned, engaged, upbeat, as if it is always 8 a.m. on a Saturday and they are the fathers of shortstops. But when they began their careers, in their own telling, they were outsiders on the make. “If you think about that era—I grew up in the sixties and seventies—business wasn’t a particularly noble profession,” Geoffrey Rehnert, an early Bain partner, told me. “The best brains went into medicine, the next best went into law.” American business, he said, “had a thinner bench.” Those who gravitated to Bain built a culture that was “not entitled at all. Not a single person was born with money in their family. Every single person came from a blue-collar or middle-class background.”

“Except for Mitt,” I said. (Romney’s ­father had been the head of American Motors Corporation, the governor of Michigan, and a member of the Nixon cabinet; there is no credible way to describe the American elite that excludes Mitt Romney.)

“Even he didn’t come from affluence,” Rehnert insisted. “He wasn’t a trust-fund guy.”

Perhaps what he meant was: Romney wasn’t a Wasp. He never really talked to his co-workers about his Mormonism, but he sometimes joked with Jewish colleagues about how their religions made them all outsiders. Even for those who worked with him, Romney had an inscrutable quality: They never cursed around him and didn’t drink, and they understood that his social life would be his family life. “I always felt that Mitt viewed himself as one of the chosen few,” one of Romney’s colleagues at Bain Capital told me. “I don’t think it ever affected his ­decision-making, but there was that overhang.” Romney was, in the late seventies and early eighties, heavily involved in Bain’s recruiting, and this is how many of his cohort still view him, as a handsome guy with a great handshake. Bill Bain, the consultancy’s titular founder, once told the New York Times that Romney seemed a decade older than he actually was.


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