The Obama campaign has opened an effective attack on Mitt Romney via Bain Capital. I assume this is part of a plan in which it has a story to tell about Bain over the next few months and this ad is only the first part of the first chapter on Romney and Bain.
It will be tempting for the Romney campaign to take the bait, defend Bain and think it can make enough people see the favorable truth about Bain and private equity to blunt the president's attacks.
This Insider constantly reminds readers that in politics, a bumper sticker beats an essay every time. President Obama has the bumper sticker this time. There isn't a short, compelling explanation of the virtues of effective, successful financial firms or financial players in the American political space today. Unfair but true.
The Romney campaign needs to keep up a steady supply of details and explanations for reporters and others willing to listen, and it needs real experts as surrogates for limited select events or media appearances. But mostly the response to Obama's attacks on Bain should be Solyndra, Solyndra-like disasters, misspent tax dollars and an indignant attack on Obama's contempt for "private investment," not "private equity." There isn't time for voters to hear enough to decide for themselves that private equity firms are people.
Private equity is beautiful, pure capitalism. Success or failure is measured by digits, and the numbers don't lie. If you were successful in private equity, you built value in more businesses than you lost. And private-equity managers are the last ones to get paid. Investors get their money back and most of the profits, then the private-equity managers share what's left.
But in a campaign and in an era in which financial institutions and financial engineers are blamed for much of our economic problems, there is no appetite for a lecture on the virtues of private equity. Romney should not try. His political problems with his Bain history will be managed, not solved. To state the obvious, Romney should work to limit the part of the election that is about the popularity or utility of international financiers.